U.S. dairy exports are on track to shatter records in 2026, reaching $10.5 billion — a full billion dollars above the previous high — as U.S. processors deploy increasingly sophisticated strategies to compete in a fiercely contested global marketplace.
“It’s exciting to see any kind of graph that goes up like that,” says Krysta Harden, president and CEO of the U.S. Dairy Export Council, addressing producers at the recent joint annual meetings. “It used to be that we would export what we had left over, and surely somebody in the world would want it. Now it is an intentional, dedicated market plan.”
That intentionality is paying off. But as three processors on the front lines of international trade made clear during a panel discussion moderated by Harden, winning global market share requires far more than simply shipping American products overseas.
From Afterthought to Strategic Imperative
The transformation of U.S. dairy exports from surplus disposal to strategic growth engine represents one of the industry’s most significant shifts in recent decades.
“Export was, for a very long time, really an afterthought,” admits Allison Schuman, fourth-generation CEO of Schuman Cheese, the nation’s largest importer of hard Italian cheese. “If we had excess cheese, if we were following a partner with a global strategy, we would take it and try to deliver for them to be a good partner.”
Today, even though exports represent just 7% of Schuman’s total revenue, “it is our fastest growing business, and we’re really looking at it in a strategic way and a more stable path to achieve growth.”
For Leprino Foods — the world’s largest mozzarella maker — the evolution has been even more dramatic.
“Back in 2008, the percentage of our business that was international was basically immaterial,” says Scott Marshall, who leads Leprino’s international cheese division. “But for the past couple of decades, international has been far and away the largest growing component of our business, and today it’s the fastest growing and a meaningful part of our business.”
The shift required a fundamental rethinking of approach.
The Failed Strategy: Selling America to the World
Marshall’s early experience offers a cautionary tale about assumptions.
“I first started working on the international cheese business in 2008, and back in those days, we were simply taking existing products that we had that were successful in the United States and trying to commercialize them overseas,” he recalls. “And to be honest, that didn’t work very well.”
The problem? Everything is different overseas.
“Cultures are different, flavor perceptions are different, perceptions of color are different, cooking methods are different, labor is different,” Marshall explains. “It all factors in to ultimately the solutions that we have to provide for our customers overseas.”
The breakthrough came when Leprino stopped trying to sell American products to foreign markets and started listening to what those markets actually wanted.
“We had to look for the convergence between what the local customers and consumers wanted from a performance standpoint and from an economic standpoint, and how that intersects with what Leprino is actually good at making,” Marshall says. “When we found that intersection, then we started to have some success.”
The American Advantage: Scale, Quality, Innovation
Despite the need for local customization, U.S. dairy processors bring distinct competitive advantages to global markets.
“What we have from the U.S. that I think Europe really misses is the ability to do things at scale — produce quality at scale,” Schuman emphasizes. “We have phenomenal QA [quality assurance] and innovation. We’re not afraid. We’re not bound by heritage. We’re able to look at different cheese types, different ways of manufacturing, and take what was great and expand upon it in a more substantial way.”
That reputation is opening doors, even in Europe itself.
Schuman recently returned from a major trade show in Paris where she witnessed firsthand how perceptions of American dairy are changing.
“For a long time, the reputation of the U.S. has been that we’re not specialty cheese makers — we’re commodity, we’re price driven,” she says. “It’s always surprising going to these shows and watching the really warm reception we get when people taste the cheeses we’re putting out. Europeans tend to have a very high opinion of the cheeses they produce, but it’s always really nice when we can show them that we’re capable of delivering that excellence and high level.”
Matt McClelland, CEO of Prairie Farms Dairy — a farmer-owned cooperative with just over 500 members in the Midwest — puts it more bluntly: “From a supply standpoint, from an efficiency standpoint, there’s no one that does it better than U.S. dairy farmers. No one.”
China: Winning Without the Cheapest Price
No discussion of dairy exports can avoid China — a market that’s simultaneously enormous, essential, challenging and increasingly self-sufficient.
“China is very inspiring to me,” Marshall says, reflecting on years spent working in the region. “It’s a really exciting, vibrant country.”
The scale is almost incomprehensible to Americans.
“If you could go to the city of Los Angeles and physically pick it up and march it across the Pacific and plunk it down in the middle of China, it would be the 21st largest city in China,” Marshall notes.
But scale alone doesn’t guarantee market access. The U.S. faces a permanent disadvantage: New Zealand’s free trade agreement with China.
“When I moved to Singapore in 2012, we had a 12% disadvantage to New Zealand,” Marshall recalls. “That’s more like starting the game down two touchdowns.”
Through persistent advocacy, that disadvantage was reduced to 8%. The impact was profound — Leprino’s China business doubled annually even with the tariff gap.
The key to competing despite tariff disadvantages? Don’t compete on price.
“We are not going to be the cheapest source of mozzarella to China,” Marshall acknowledges. “If a customer wants cheap cheese, we’re actually not the best place to go. But there are other ways we can provide value and uniquely serve the needs of customers in China that are beyond price.”
Those include quality consistency, supply certainty and scale that can keep pace with China’s meteoric growth in dairy consumption.
“I don’t think New Zealand is individually capable of meeting the demands of China going forward,” Marshall says. “There are a lot of major dairy buyers looking for supply certainty. They’re not looking for price. Price becomes secondary because they have to keep their operations running.”
Southeast Asia: Understanding Each Country’s Uniqueness
If China represents a complicated opportunity, Southeast Asia offers clearer potential — if processors understand the complexity.
“From a population standpoint, it is a very exciting market,” Marshall says. “There are about double the human beings in Southeast Asia than in the United States.”
Overlay increasing affluence — particularly in Vietnam and Indonesia — with strong U.S. market access, and the opportunity becomes compelling.
But there’s a critical caveat.
“You can’t just say, ‘We’re going to focus and play in Southeast Asia,’” Marshall warns. “Just because these countries share a border doesn’t mean they’re identical. Canada, Mexico and the United States share a border — those three countries are quite different.”
The same applies to Vietnam, Malaysia, Thailand and Indonesia. Each requires country-specific strategies.
Schuman agrees, noting that her company has invested in local talent on the ground to navigate cultural differences in business practices.
“Traditionally in Asian culture, dairy has not been front of the diet,” Schuman notes. “So as there is more education around how it can be used, the nutritional benefits and how it can be a really great protein source — not just a luxury item — I think there’s a lot of room for growth.”
Latin America: The Overlooked Opportunity
While Asia captures headlines, panelists emphasize that Latin America — particularly beyond Mexico — represents enormous untapped potential.
“I think we really see the biggest opportunity to go deeper into Latin America,” Schuman says. “Mexico has been a good trade partner for us, but we’re really just scratching the surface of what we can do.”
The advantages are compelling: geographic proximity, cultural affinity for dairy and existing relationships.
“Geographically they’re really desirable. There’s already an inherent love of dairy and good cheese,” Schuman notes. “Europe has done a good job of getting into Mexican and Latin American markets, and I think they are easy for us to really grow and expand with and pick off some of that European distribution.”
The results speak for themselves: Schuman Cheese grew 44% in Latin American markets last year.
McClelland reinforces the importance of not overlooking nearby opportunities while chasing distant markets.
“We talk a lot about Asia, we talk about Africa, but we cannot forget the Americas,” he says. “Take the ones you have, build the relationships, sell the full line.”
Harden agrees: “We control 80%-plus of Mexico’s cheese imports already. They think like us. Great partnerships, great relationships, and a lot of trust for the U.S. product. But we’re working with companies like yours thinking about the other countries, the other consumers around all of Latin America and Central America.”
The Secret Weapon: Being Local
Perhaps the most consistent theme across all markets was the critical importance of local presence.
“My own point of view is that promotion is ultimately rooted in us being local in the various countries,” Marshall says. “USDEC does a really nice job of that. Being local and feeling local is really important.”
He illustrates with a practical example.
“Imagine if we operate in Saudi Arabia, and somebody picks up a phone and needs one of our products, but there’s no one to pick up the phone because we’re sleeping while they’re working,” Marshall says. “So they send us an email and hope that in two or three days they’re going to hear back from us.”
The alternative? “We have a human being — either with USDEC or with folks on our payrolls — actually there, living and working in the region, accepting their call, in certain cases speaking their language and understanding their culture.”
Leprino takes it even further in the Middle East.
“We actually invest in pre-positioned inventories,” Marshall reveals. “We’ll make cheese in the United States, throw it on a container and ship it proactively over to Dubai and hold it in a free trade zone, such that when a customer needs a container of cheese, they aren’t waiting five months. They can get it in a matter of days because we already have it there.”
Harden notes USDEC now has offices in 10 locations worldwide, including in Dubai, which covers the Middle East and Northern Africa.
“Our head of that office is Lebanese. Her staff is local. They speak the languages. They understand the culture, the foods,” Harden says. “You have to be there.”
The Policy Battleground: Common Food Names
While market strategies matter, policy barriers can make or break export opportunities.
One of the most frustrating: Europe’s aggressive push to restrict use of common cheese names like Parmesan, feta and others through geographic indication protections.
“Europe is actively trying to push against us to say this is not a common food name, this is a protected region and something that only we can use,” Schuman explains. “But we have our own history of excellent production in some of these cheeses, and it has its own unique standard of identity.”
The stakes are high.
“If you look at Italy, their domestic consumption is flat to declining, but they’re continually growing because of their export market,” Schuman notes. “And that’s something we’re being kept out of.”
The work of the Consortium for Common Food Names — led for years by the recently retired Jaime Castaneda — remains critical to leveling the playing field.
The Protein Wave
Underlying all export opportunities is a global structural shift: exploding demand for protein.
“As income increases across the world, they’re going to spend it on protein,” McClelland observes. “Think about what a savior it was to the cottage cheese industry.”
McClelland sees U.S. dairy perfectly positioned to meet that demand.
“As a U.S. dairy industry, we have the opportunity, because of our scale and because of our efficiencies, to feed the world,” he says. “I’ve never met a dairy farmer in the United States of America that doesn’t want to milk more cows. If we’re going to milk more cows, we’ve got a great market. And protein is going to drive a lot of that market, especially in the next 10 years.”
The Farmer Voice
Perhaps the most powerful tool in building export markets isn’t sophisticated logistics or trade agreements — it’s farmers themselves.
“There’s a whole list of farmers who make sure we’re going and talking about not only what you do as a U.S. dairy farmer, but why,” Harden says. “That’s the thing that most of our customers, our partners, foreign governments really want to know: Why? Why the U.S.?”
The farmer perspective carries unique credibility.
“We talk about the versatility, the high quality, the commitment we have to supplying that, but they want to know that from a farmer,” Harden emphasizes. “It really does take that farmer’s voice to make sure the ‘why they should buy from the U.S.’ is explained.”
The Road to $10.5 Billion and Beyond
As the panel concluded, the path forward became clear: U.S. dairy exports will continue growing not through a single strategy, but through multiple complementary approaches.
Large processors like Leprino will continue building local presence, pre-positioning inventory and competing on quality and reliability rather than price in challenging markets like China.
Specialty producers like Schuman will leverage American innovation and scale to challenge European dominance in markets that traditionally favored Old World products.
Midwestern cooperatives like Prairie Farms will focus on domestic stability while partnering with brokers and larger players to participate in export growth without overextending.
And USDEC will continue opening doors through trade policy advocacy, local market presence and farmer-led relationship building that puts a human face on American dairy quality.
The $10.5 billion export milestone expected in 2026 represents not a peak, but a waypoint.
“We are growing in our exports, and there’s a lot of reasons for that,” Harden says. “One of them is just market access, new trade opportunities around the world. If our government and others open those doors for us, we believe we can compete. We can convince customers around the world their source of choice should be the U.S.”
Marshall sums up the competitive mindset required: “I’m a competitive guy, and lots of folks in the room are competitive people. I think we are remiss as an industry if we just surrender and wave our white flag and let other people win. We have to be in the game, and I do think we can win.”
The next billion dollars in exports will prove whether that belief is justified.
