After a record-setting year for U.S. dairy exports in 2008, sluggish world demand caused by the global economic crisis and increased milk production helped to create a much different export situation during the first half of 2009.
The total volume of non-fluid dairy products traded through June was approximately 1.2 billion pounds, a 26.4 percent decline compared to the first half of 2008. Lower world dairy product prices and lower export volumes pushed the total value of exports through June down to 985.4 million. That's a 51.5 percent decline compared to this time last year.
The United States still maintains a positive export volume trade balance, exporting 448.6 million more pounds than it imported during the first half of 2009. But that didn't help the dollar trade balance for U.S. dairy products, which went from a positive $644.3 million in 2008 to a negative $221.8 million in 2009.
Dry whey and related products constituted the largest volume export share, overtaking nonfat dry milk. During the first half of the year, dry whey and related products exports totaled 374.3 million pounds, up 0.9 percent over year-ago levels. Even though nonfat dry milk export volume was down 53.5 percent over year-ago levels, it was still the second most-exported dairy product, with 240.1 million pounds traded. Lactose was the third most-exported dairy product during the first half of the year, with 227.8 million pounds exported (6.4 percent more than last year).
Another important dairy export category, cheese and curd, experienced a 29 percent decline in total export volume over year-ago levels, with 110.8 million pounds exported in 2009.
The total export value of nonfat dry milk also declined, falling 74.6 percent during the first half of 2009 when compared to year-ago levels, but it still represents the largest U.S. export category in terms of value ($220.2 million). Cheese and curd ($199.3 million), dry whey and related products ($184 million) and lactose ($56.3 million) also declined in export value compared to last year. Butter and milkfat exports, included in the list of top five export earners last year, went from $158.9 million in the first half of 2008 to only $29.6 million in 2009, an 81.4 percent decline.
Mexico and Canada continue to be the largest importers of U.S. dairy products. Mexico imported $313.7 million worth of U.S. dairy products in the first half a 2009, a 37.5 percent decline compared to the same period in 2008. Exports to Canada totaled $162.1 million, declining 12.3 percent over year-ago levels. The main dairy exports to these countries were nonfat dry milk, cheese and curd, and whey. Japan imported $64.1 million in dairy products, followed very closely by China at $61.1 million. South Korea rounded out the top five, importing $33.7 million worth of U.S. dairy products. Compared to last year, export revenues to these three Pacific Rim countries were close to 40 percent less than year-ago levels.