U.S. dairy export volume on a solids basis is up 16% in the first seven months of 2020, and up 14% by value compared with the 2019 pace.
In the latest four months, the majority of the growth came from increased shipments of nonfat dry milk/skim milk powder (NDM/SMP) to Southeast Asia and whey products to China. Gains in these markets were partially offset by continued weakness in sales to Mexico, where overall export volume trailed last year by 18%.
In July data released Thursday, U.S. suppliers shipped 196,080 tons of milk powders, cheese, whey products, lactose and butterfat, 22% more than last year. The value of all exports was $554.1 million, up 17%.
Since April, roughly half of the overall U.S. export growth has come just from greater sales of NDM/SMP to Southeast Asia.
In July, sales to the region were 30,103 tons, up 150% from last year, when the EU was still aggressively selling down its intervention stockpile. During the month, U.S. shipments to Indonesia, the Philippines and Vietnam more than tripled. So far in 2020, U.S. sales to the region are 12,225 tons a month more than last year.
Led by Southeast Asia, total NDM/SMP exports were 75,294 in July, up 52% from last year. U.S. suppliers also found new customers in Egypt (3,418 tons, vs. zero last July) and China (1,916 tons, vs. 461 tons last July). In contrast, volume to Mexico was down 6% in July.
Meanwhile, total whey sales to China continue to recover from the depressed levels of last year. Shipments to China in July were 17,642 tons, lower than the previous two months but more than double last year, when African Swine Fever decimated China’s hog herd and reduced demand for whey for feed use. In addition, sales to Southeast Asia were an 11-month high in July, registering a 45% gain over a year ago.
On the strength of these two markets, total U.S. whey exports were up 30% in July, topping 45,000 tons for the first time in almost two years. Volumes of high protein WPI continued to move at a record clip, up 48% in July on strong demand from China, the EU and Japan.
Cheese exports volumes pulled back in July from the record volumes of June, as suppliers were more challenged to book deals when U.S. pricing was well above global prices. Export unit value in July was $326/ton higher than in June. Overall shipments in July were 29,266 tons, up 5% from last year. Sales to South Korea more than doubled but volumes to Australia, Saudi Arabia, the UAE and Central America were down by a combined 2,380 tons (-39%). Shipments to Mexico were off 1% from last year.
Lactose exports were the lowest of the year (daily-average basis), with a sharp drop in sales to Mexico. Total volume was 32,538 tons, down 11% from last year. Exports to Mexico were just 2,192 tons, one-third of the record volume shipped last July, but also the lowest total in four-and-a-half years. In contrast, China purchases continued to increase with a 27% gain vs. a year ago.
Exports of milk protein concentrates (MPC) remained significantly higher for the fourth straight year. Volume was 34% in July, bringing the year-to-date growth rate up 32%. MPC volume in 2020 is the highest since 2014.
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