February 26, 2010
Dairy Export Volume Slides in 2009, but Value Plummets
By Rob Blaufuss, IDFA Economic Analyst
Following a record-setting dairy export year in 2008, the global economic recession caused world demand for dairy products to decline in 2009. This decline in global demand, coupled with increased world milk production, also caused precipitous declines in dairy product prices in 2009 compared to year-ago levels.
Coming after a 24-percent decline in dairy export volume through the first three quarters of 2009 compared to year-ago levels, exports surged in the fourth quarter to finish the year down only 16 percent. The total export volume of non-fluid products was 2.55 billion pounds. The total value of exports was $2.24 billion, a 40-percent decline compared to 2008.
Historically speaking, however, 2009 was still a very strong year for U.S. dairy exports. Though total export volume declined, it was still the third-highest export level on record. Total export volume, according to the U.S. Dairy Export Council, represented 9.3 percent of U.S. milk production in 2009, down from 11 percent in 2008. Compare the 2009 level to that of 2005 (8.3 percent of milk production) or 2000 (5.5 percent of milk production) and it's easy to see just how vital export markets remain to the U.S. dairy industry.
Dry Whey Exports Increase
Dry whey was the most exported U.S. dairy product in 2009, with 790.0 million pounds exported. This total export level was actually 2.4 percent above year-ago levels. Although nonfat dry milk exports declined 36 percent compared to year-ago levels, they were still the second-highest dairy export in 2009, with 548.6 million pounds exported. Lactose, the third most-exported dairy product, experienced significant growth in its total export level in 2009 with nearly a 74-million-pound increase (more than 18 percent) compared to 2008. Other important dairy product exports were infant formula, albumin and malted milk (295.5 million pounds) and cheese and curd (239.2 million pounds).
Dramatically reduced dairy product prices worldwide, coupled with declines in total export volume for many U.S. dairy products, caused significant declines in total export dollar sales in 2009. Nonfat dry milk remained the most important driver of export dollar sales in 2009, but its total dollar value declined to only $520 million, a 62-percent drop compared to year-ago levels. Cheese and curd remained the second-largest source of export revenue in 2009, with $430.4 million worth of product exported, but that figure represents a 24-percent decline compared to 2008. Dry whey ($409.3 million), other dairy products ($394.5 million) and lactose ($142.3 million) rounded out the top five in 2009.
Mexico, Canada Still Biggest Export Markets for U.S. Dairy Products
Mexico and Canada remained the most important destinations for U.S. dairy exports in 2009. These two countries alone purchased $973.1 million dollars worth of U.S. dairy products last year. China, the sixth-highest source of export dollar sales in 2008, imported $137.6 million of dairy products in 2009, making it the third-largest source of export revenue last year. Japan ($131.5) and the Philippines ($78.1 million) rounded out the top five. These five countries accounted for 59 percent of total dairy product export revenue in 2009.
The U.S. Department of Agriculture expects modest improvements for U.S. dairy exports in 2010, as worldwide demand gradually returns following the global economic crisis.
• 2008 and 2009 Total U.S. Dairy Exports
• 2008 and 2009 Total U.S. Dairy Imports
• Total 2009 Import/Export Quantities
