Dairy Market Update: June 2005

Based on data through April 2005, there has been significant growth in U.S. trade in dairy products this year — both in terms of exports and imports, as well as in quantity and value bases. Data from USDA's Foreign Agricultural Service shows that tonnage of exports increased 38%, while their value is up 41%; imports were up 16% in quantity and 29% in value.

In terms of total quantity, more than 349,000 metric tons (MT) of U.S. non-fluid milk products were exported to overseas markets in the first four months of this year, with most of the exports being nonfat dry milk (41%) or whey (11%). In addition, approximately 17 million pounds of fluid milk and cream left the country. Combined, this total is about 75 million MT more than the total of dairy products imported into the United States.

Specifically, growth in NFDM sales has been a major driver of total exports growth. More than 120,000 MT of NFDM have been shipped so far this year, compared to 48,000 MT a year ago — an increase of 150%. The total value of 2005 NFDM exports to date is $237 million, an increase of 171% over last year.

Whey is another important component of U.S export growth. Compared to one year ago, whey tonnage has grown from 60 million MT to 87 million MT; value increased from $45 to $64 million, representing increases of 45% and 43%, respectively. Yogurts and Other Fermented Products also saw a notable value increase of 71%, but in terms of quantity, this category currently represents a small portion of total exports.

While U.S. exports have higher quantities, U.S. imports have the greater dollar value. About $890 million worth of dairy products have come into the United States so far this year (through April). This compares to $575 million for U.S. exports. Imports to the United States are led by higher-end cheeses, which have raised the value of imports per metric ton due to this category's generally higher price tag. Imported cheese represented 36% of the total value of U.S. imports through April, while representing just 25% of total import quantity.

Posted June 27, 2005