Dairy exports on the rise

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U.S. dairy exports posted a banner year in 2005, according to data from the U.S. Dairy Export Council (USDEC).

Last year, U.S. exporters shipped 1.81 billion pounds of milk solids overseas — up from 1.60 billion pounds in 2004 and 1.20 billion pounds in 2003. Exports now represent 8.3 percent of U.S. milk output, more than double the proportion of a decade ago, according to USDEC.

Export growth came as a result of robust worldwide demand for dairy protein in 2005. Economic growth in China, Russia, Mexico and the Middle East created opportunities for increased sales of milk components. The United States took advantage, reigning as the world’s leading supplier of skim milk powder, whey and lactose last year, according to USDEC.

Exports also helped clear the domestic market of excess milk solids, notes Tom Suber, president of USDEC. In a year when U.S. milk production increased by nearly 4 percent — the largest burst of expansion in 20 years — dairy markets remained mostly tight all year and the all-milk price registered its third-highest annual average ever. Domestic nonfat dry milk (NFDM) prices climbed 20 cents above the government support price and whey prices reached an all-time high.

This was made possible, in part, because the United States was able to export about 35 percent of all the nonfat milk powder produced, 40 percent of its sweet whey and whey protein concentrate, 55 percent of its whey protein isolate and 61 percent of its lactose, according to USDA and USDEC data. With strong commercial markets overseas, there were no sales of excess dairy products to the USDA’s Commodity Credit Corp. last year for the first time in at least 35 years.

Since 2003, U.S.dairy exports have increased 52 percent (up 617 million pounds of milk solids), while U.S.dairy imports have increased by just 7 percent (up 60 million pounds of milk solids). On a milk-solids basis, exports were 87 percent higher than imports in 2005, according to USDEC.

Here are some export highlights from 2005:

  • U.S. dairy exports in 2005 were valued at $1.66 billion. More than half the sales were dry ingredients – nonfat dry milk (NFDM), whey proteins and lactose.
  • Exporters shipped 635 million pounds of NFDM last year, up 6 percent from 2004, and the most since 1987. Except for small volumes of food aid, all the exports were commercial, unsubsidized sales.
  • U.S. exports of whey proteins in 2005 were a record-high 607 million pounds, up 31 percent from the year before. Shipments of sweet whey (up 18 percent) and whey protein concentrate (up 84 percent) were significantly higher in 2005, while exports of whey protein isolate were off 15 percent.
  • U.S. suppliers shipped 406 million pounds of lactose in 2005, up 18 percent from the prior year.
  • Cheese exports totaled 127 million pounds, down 6 percent from the year before. Counting commercial sales only, U.S. cheese exports decreased 1 percent in 2005.
  • Results were mixed for exports of other manufactured products. After three years of declines, exports of ice cream increased 9 percent from 2004. Sales of fluid milk dropped 28 percent. Exports of butterfat were down 8 percent in 2005.

USDEC



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