Executive Summary

U.S. dairy export figures provided by the USDA were recently updated with values spanning through Mar ’22. Highlights from the updated report include:

• U.S. butterfat export volumes finished 58.9% higher on a YOY basis throughout Mar ’22, remaining at an eight year high seasonal level. The U.S. finished as a net exporter of butterfat for the third consecutive month.
• U.S. cheese export volumes finished 12.9% higher on a YOY basis throughout Mar ’22, reaching a record high seasonal level and the second highest monthly level on record. Dry whey export volumes remained below previous year levels for the ninth time in the past ten months, however whey protein concentrate export volumes finished above previous year levels for the first time in the past seven months.
• U.S. nonfat dry milk/skim milk powder export volumes finished 7.4% below previous year levels throughout Mar ’22, remaining lower on a YOY basis for the fourth consecutive month. NFDM/SMP export volumes remained at the second highest seasonal level on record, however.

Additional Report Details

Butter – Exports Remain at an Eight Year High Seasonal Level, up 58.9% YOY

According to the USDA, Mar ’22 U.S. export volumes of butterfat declined slightly from the seven and a half year high level experienced throughout the previous month but remained 58.9% above previous year levels. U.S. butterfat export volumes remained at an eight year high seasonal level for the fifth consecutive month. The YOY increase in butterfat export volumes was the 16^th experienced in a row. The U.S. finished as a net exporter of butterfat for the third consecutive month.

’20-’21 annual butterfat export volumes finished 113.1% above the four year low level experienced throughout the previous production season, reaching a seven year high annual level. ’21-’22 YTD butterfat export volumes have increased by an additional 73.2% on a YOY basis throughout the first half of the production season.

Canada continued to be the top destination for U.S. butterfat export volumes throughout Mar ’22, accounting for nearly half of the total export volumes. Canada and Mexico combined to account for over 60% of all butterfat export volumes throughout the month.

Butterfat export volumes destined to Canada increased most significantly on a YOY basis throughout the month, followed by shipments destined to Mexico and South Korea, while butterfat export volumes destined to the EU-27+UK finished most significantly lower.

Canada and Mexico have historically been the largest importers of U.S. butterfat, accounting for over half of the total U.S. export volumes experienced throughout the past five years. U.S. butterfat export volumes destined to Canada have increased 114.9% on a YOY basis throughout the past 12 months while volumes destined to Mexico increased by 67.8% throughout the period. U.S. butterfat export volumes destined to all other countries have increased by 100.1% throughout the past 12 months, led by increases in volumes destined to Bahrain.

Cheese – Exports Reach the Second Highest Monthly Level on Record, up 12.9% YOY

Mar ’22 U.S. cheese export volumes increased to an 11 month high level while finishing 12.9% above previous year levels, reaching a record high seasonal level for the month of March and the second highest monthly level on record. The YOY increase in cheese export volumes was the ninth experienced in a row. Cheddar cheese export volumes increased 185.6% on a YOY basis throughout the month while other-than-cheddar cheese export volumes finished 3.6% above previous year levels.

’20-’21 annual cheese export volumes finished 4.6% above the previous year levels, reaching a record high annual level for the first time in the past seven years. ’21-’22 YTD cheese export volumes have increased by an additional 22.2% on a YOY basis throughout the first half of the production season.

Mexico was the top destination for U.S. cheese export volumes throughout Mar ’22, accounting for over a quarter of the total export volumes. Mexico, South Korea and Japan combined to account for half of all cheese export volumes throughout the month.

YOY increases in cheese export volumes were led by product destined to Mexico, followed by volumes destined to South Korea and Australia, while cheese export volumes destined to Chile finished most significantly lower.

Mexico and South Korea have historically been the largest importers of U.S. cheese, accounting for nearly 45% of total U.S. cheese export volumes throughout the past five years. Combined U.S. cheese export volumes destined to Mexico and South Korea have increased 112.8% on a YOY basis throughout the past 12 months as a 24.8% YOY increase in volumes destined to Mexico has more than offset a 1.9% YOY decline in volumes destined to South Korea.

Whey – Dry Whey Export Volumes Lower YOY, Whey Protein Concentrate Export Volumes Higher

U.S. dry whey export volumes reached a ten month high level throughout Mar ’22 but remained 17.9% below previous year levels. The YOY decline in dry whey export volumes was the ninth experienced throughout the past ten months.

’20-’21 annual dry whey export volumes finished 21.8% above previous year levels, reaching a three year high annual level. ’21-’22 YTD dry whey export volumes have declined by 17.5% on a YOY basis throughout the first half of the production season, however.

U.S. whey protein concentrate (WPC) export volumes reached a 15 month high level throughout Mar ’22, finishing 13.8% above previous year levels and reaching a four year high seasonal level. The YOY increase in WPC export volumes was the first experienced throughout the past seven months and the largest experienced throughout the past 12 months on a percentage basis.

’20-’21 annual WPC export volumes finished 6.2% above previous year levels, reaching a three year high annual level. ’21-’22 YTD WPC export volumes have declined by 13.8% on a YOY basis throughout the first half of the production season, however.

China continued to be the top destination for U.S. whey export volumes throughout Mar ’22, accounting for 40% of the total export volumes. China and Mexico combined to account for over half of all whey export volumes throughout the month.

YOY increases in whey export volumes were led by product destined to Japan, followed by volumes destined to Canada, while volumes destined to China finished most significantly lower on a YOY basis throughout the month.

China has historically been the largest importer of U.S. whey products, accounting for over 35% of the total U.S. whey export volumes throughout the past five years. U.S. whey export volumes destined to China have declined 3.5% YOY throughout the past 12 months however whey export volumes destined to all other countries have increased by 7.7% on a YOY basis over the same period.

NFDM/SMP – Exports Remain Lower YOY for the Fourth Consecutive Month, Down 7.4%

Mar ’22 U.S. export volumes of nonfat dry milk (NFDM) and skim milk powder (SMP) rebounded to a nine month high level but remained 7.4% below previous year levels. The YOY decline in NFDM/SMP export volumes was the fourth experienced in a row. Despite declining on a YOY basis, NFDM/SMP remained at the second highest seasonal level on record.

’20-’21 annual NFDM/SMP export volumes finished 8.9% above previous year levels, reaching a record high annual level for the second consecutive year. ’21-’22 YTD NFDM/SMP export volumes have declined by 3.5% on a YOY basis throughout the first half of the production season, however.

Mexico was the top destination for U.S. NFDM/SMP export volumes throughout Mar ’22, accounting for over a third of the total export volumes. Mexico, the Philippines and Indonesia combined to account for half of all NFDM/SMP export volumes throughout the month.

YOY declines in NFDM/SMP export volumes were led by product destined to Egypt, followed by volumes destined to Vietnam and Algeria, while export volumes destined to Malaysia finished most significantly higher on a YOY basis throughout the month.

Mexico has historically been the largest importer of U.S. NFDM/SMP, accounting for over 40% of all U.S. NFDM/SMP export volumes throughout the past five years. U.S. NFDM/SMP export volumes destined to Mexico have increased 12.5% on a YOY basis throughout the past 12 months, more than offsetting a 1.7% YOY decline in volumes destined to all other countries.

Export Volumes Normalized to Production

U.S. butterfat, cheese and NFDM/SMP export volumes as a percentage of production finished above previous year figures during Mar ’22 while dry whey export volumes as a percentage of production finished below previous year levels.

Overall, U.S. dairy export volumes were estimated to be equivalent to 19.3% of total U.S. milk-solids production during Mar ’22 while dairy import volumes were estimated to be equivalent to 3.5% of total U.S. milk-solids production. Mar ’22 net dairy trade was estimated to have declined 1.4% on a YOY basis, finishing lower for the fourth consecutive month.

U.S. dairy exports as a percentage of milk-solids production are estimated to have increased 1.0% on a YOY basis throughout Mar ’22, reaching a record high monthly level. The YOY increase in dairy exports as a percentage of milk-solids production was the 13^th experienced throughout the past 14 months.

’20-’21 annual dairy exports as a percentage of milk-solids production finished 8.4% above previous year levels, reaching a record high annual level for the first time in the past three years. ’21-’22 YTD dairy exports as a percentage of milk-solids production have increased by an additional 3.9% on a YOY basis throughout the first half of the production season.

Mar ’22 U.S. dairy imports as a percentage of milk-solids production are estimated to have increased 13.6% on a YOY basis, reaching a five year high seasonal level. The YOY increase in dairy imports as a percentage of milk-solids production finished above previous year levels for the third consecutive month.

’20-’21 annual dairy imports as a percentage of milk-solids production finished 9.5% below previous year levels, reaching a ten year low annual level. ’21-’22 YTD dairy imports as a percentage of milk-solids production have rebounded by 3.7% on a YOY basis throughout the first half of the production season.

Net trade of U.S. NFDM/SMP continued to outpace that of butter, cheese and dry whey as import volumes remain minimal. Net cheese trade volumes exceeded net dry whey trade volumes for the fourth consecutive month throughout Mar ’22 while the U.S. finished as a slight net exporter of butter for the third consecutive month.