Dairy exports strong: Let me count the ways
Any way you count it, 2013 was a banner year for U.S. dairy exports, according to a monthly and year-to-date summary from the U.S. Dairy Export Council.
• Total solids: Total overseas sales of U.S. milk solids were equivalent to 14.9% of U.S. milk production in December, leaving the full-year percentage at 15.5%, up from 13.2% in 2012.
Meanwhile, imports as a percent of milk-solids production were 3.4% in December, and 3.0% for the year.
• Percent of product: U.S. exports as a percentage of annual total production were up for every major product category, with 58% of nonfat dry milk/skim milk powder production exported last year. About 56% of total dry sweet whey production was exported, as was 72% of all lactose, 10.7% of all butterfat, and 6.3% of all cheese.
• Volume: For the month, U.S. exports of cheese topped 30,000 tons for the first time in December, and butterfat sales continued their improved pace. Skim milk powder and dry whey shipments saw a slight seasonal slowdown, but on balance U.S. exports during the month were well above a year ago, closing out a year of record export sales. U.S. suppliers shipped 158,001 tons of milk powder, cheese, butterfat, whey and lactose in December, up 30% from the prior year. Throughout 2013, export volume was 18% higher than the 2012 level.
• Value: On a value basis, U.S. exports were worth $604 million in December, 47% higher than prior year. It was the fifth month export values topped $600 million, bringing the full-year total to $6.72 billion, a 31% improvement on 2012.
• Market share: The United States was able to gain share of global dairy trade in 2013. Among the world's top nine exporters, U.S. export share of milk powder, cheese, butterfat and whey products was 19.0%, up from 16.1% in 2012. Increases were widespread across virtually all major markets in 2013. The three fastest-growing U.S. markets were China, Southeast Asia and the Middle East/North Africa region.
Source: USDA, USDEC, National Milk Producers Federation
Pennsylvania January IOFC improves
Penn State University’s measure of income over feed costs (IOFC) rose 3.5% in January, according to the latest Dairy Outlook report from economist Jim Dunn. At $10.74/cow/day, the January IOFC is up 36¢/day from December, and the highest value since September 2007.
IOFC reflects daily gross milk income less feed costs for an average cow producing 65 lbs. of milk per day, and the improvement in January came from a higher milk price. The January Pennsylvania all-milk price was up 60¢/cwt. from the revised December estimate, to $24.00/cwt., the highest level since August 2011.
That milk price increase was offset slightly by a 0.6% increase in overall feed prices. The average cost to feed a cow producing 65 lbs. of milk per day rose 3¢, to $4.86/day.
Measured another way, feed costs per hundredweight of milk produced averaged $7.48/cwt. in January, up 5¢ from December. With the higher milk price, the milk margin over feed costs was $16.52/cwt., up 55¢/cwt. from December 2013 and up $4.37/cwt. from a year ago.
Dunn’s forecast of the average 2014 Pennsylvania all-milk price is $22.97/cwt., which would be up $1.49 (6.9%) from 2013’s estimated price of $21.48/cwt.
To read Dunn’s latest Dairy Outlook report, click here.
USDA to release new long-term agricultural projections
USDA will release new 10-year agricultural projections on Feb. 13. USDA's Agricultural Projections to 2023 will be posted to the Office of the Chief Economist's (OCE) website at www.usda.gov/oce and available in MS Word and PDF formats. Projections data will be available as Excel spreadsheets here.
USDA publishes the projections each year in February. The projections are developed by interagency committees in USDA, with the Economic Research Service (ERS) having the lead role in the preparation of the report. The new projections cover crop and livestock commodities, agricultural trade and aggregate indicators, such as farm income, through 2023. The projections do not represent a USDA forecast, but a conditional, long-run scenario based on specific assumptions about farm policy, weather, the economy and international developments. Normal weather is assumed throughout the projection period.
The projections were prepared during October through December 2013, with the 2008 Farm Act assumed to be extended and remain in effect through the projection period. Therefore, the projections do not reflect the Agricultural Act of 2014.
Background on USDA's long-term projections and past issues of the report are available on the ERS website at www.ers.usda.gov/topics/farm-economy/agricultural-baseline-projections.aspx.