Whey powder.
October 7, 2020

August Dairy Exports Set Monthly Record

 |  By: Jim Dickrell

The volume of dairy exports on a milk solids basis were up 17% in August over year-earlier levels, and up 16% year-to-date, reports the U.S. Dairy Export Council (USDEC).

August also marked a record month for dairy exports, with the U.S. shipping 190,435 tons of milk powder, cheese, whey products, lactose and butterfat. August also was the 12th straight month of year-over-year increases in aggregate U.S. dairy export volume, reports USDEC. The value of these exports was up 11% in August, and up 14% year-to-date.

“Year to date, we are on track to break $6 billion in U.S. dairy export this year,” adds Michael Dykes, president and CEO of the International Dairy Foods Association (IDFA). “Volatility and uncertainty remain a factor in the dairy market and trade, but IDFA remains optimistic that with continued demand for dairy around the world, especially in Southeast Asia and China, this year will end on a high note.”

In August, total U.S. nonfat dry milk/skim milk (NDM/SM) powder exports were up a whopping 35%, driven primarily by a doubling of shipments to Southeast Asia. China was the big buyer, going from just 173 tons in August 2019 to 5,343 tons this August. NDM/SM sales to Mexico, however, were down 15%.

Surprisingly, cheese exports were also up, growing 17%. “U.S. cheese export prices were well below May-June domestic prices, suggesting U.S. exporters accepted lower margins to maintain international relationships,” says USDEC trade analysts.

U.S. whey exports were up 29%, with most of that increase due to Chinese buying and its attempt to rebuild it hog herd after pig farms there were devastated by African swine fever. U.S. whey shipments to China in August reached 17,212 tons—up 318%. This increase in whey exports more than offset steep declines in shipments to the rest of Southeast Asia (-14%) and Mexico (-60%).

Dykes notes that overall U.S. dairy export volume to China, through August, has already exceeded shipments made there in all of 2019. He expects export value levels to surpass 2019 levels soon. He credits the U.S./China Phase One trade agreement for those increases.

To read the full USDEC report, click here.