U.S. Dairy Exports Down 10.0% MOM, Reach Six Month…
According to USDA, the total value of all U.S. dairy exports in Jul ’14 declined sharply MOM, finishing the month down 10.0% on a daily average basis. The MOM decline was the third in four months as U.S. dairy product prices continue to gain vs. international prices. The trend of YOY increases continued, with the total value of all U.S. dairy exports up 1.6% YOY, however the YOY increase was the smallest in over a year and a half.
Butter – Exports Remain Relatively Weak, Reach 15 Month Low
Jul ’14 export volumes of butterfat remain week, declining 38.5% YOY and 12.9% MOM on a daily average basis. Butterfat export volumes reached a 15 month low in Jul ’14, with the YOY percentage decline being the largest in nearly two years. Butterfat exports began to slow in the second quarter of 2014, with 2Q ’14 export sales 36.2% below 1Q ’14 export sales on a daily average basis. Despite the recent YOY declines, ’13-’14 YTD butterfat exports remain 65.9% higher than last year through the first ten months of the production season.
U.S. butter prices have traded at a premium to Europe and New Zealand butter prices when adjusted to 80% butterfat since May, reducing export demand. Recently, the spreads have increased, with U.S. butter prices trading at a 31.1% premium to Europe and a 67.8% premium to Oceania throughout August. If this trend continues it is reasonable to expect an extended relative decline in U.S. butter exports.
Cheese – Exports Down MOM but Remain Strong Overall, up 17.9% YOY
Cheese exports declined 8.2% MOM on a daily average basis off the second largest monthly volume shipped in Jun ‘14, but remain strong overall. On a YOY basis, cheese exports increased 17.9%, the 14th straight month of YOY increases. Cheese exports to South Korea, Japan and Mexico, which accounted for over half of total shipments for the fifth straight month, remained relatively strong, increasing 26.9% YOY while declining only 1.6% MOM. ’13-’14 YTD cheese exports are up 35.6% through the first ten months of the production season.
NFDM/SMP – Exports off Previous Record Highs
Jul ’14 export volumes of NFDM/SMP declined 16.8% MOM on a daily average basis off the record export volume shipped in Jun ’14, resulting in the largest monthly percentage decline in NFDM/SMP exports in over three and a half years. On a YOY basis, NFDM/SMP exports increased 1.1%. Over two thirds of July shipments were destined to Southeast Asia and Mexico however after two months of robust shipments to Mexico, shipments to Mexico declined 30.8% MOM and 7.2% YOY. ’13-’14 YTD NFDM/SMP exports are up 19.8% through the first ten months of the production season.
See the table below for a summary of key U.S. dairy product exports as a percentage of production in Jul ’14.
Butter – Exports Remain Relatively Weak, Reach 15 Month Low
Jul ’14 export volumes of butterfat remain week, declining 38.5% YOY and 12.9% MOM on a daily average basis. Butterfat export volumes reached a 15 month low in Jul ’14, with the YOY percentage decline being the largest in nearly two years. Butterfat exports began to slow in the second quarter of 2014, with 2Q ’14 export sales 36.2% below 1Q ’14 export sales on a daily average basis. Despite the recent YOY declines, ’13-’14 YTD butterfat exports remain 65.9% higher than last year through the first ten months of the production season.
U.S. butter prices have traded at a premium to Europe and New Zealand butter prices when adjusted to 80% butterfat since May, reducing export demand. Recently, the spreads have increased, with U.S. butter prices trading at a 31.1% premium to Europe and a 67.8% premium to Oceania throughout August. If this trend continues it is reasonable to expect an extended relative decline in U.S. butter exports.
Cheese – Exports Down MOM but Remain Strong Overall, up 17.9% YOY
Cheese exports declined 8.2% MOM on a daily average basis off the second largest monthly volume shipped in Jun ‘14, but remain strong overall. On a YOY basis, cheese exports increased 17.9%, the 14th straight month of YOY increases. Cheese exports to South Korea, Japan and Mexico, which accounted for over half of total shipments for the fifth straight month, remained relatively strong, increasing 26.9% YOY while declining only 1.6% MOM. ’13-’14 YTD cheese exports are up 35.6% through the first ten months of the production season.
NFDM/SMP – Exports off Previous Record Highs
Jul ’14 export volumes of NFDM/SMP declined 16.8% MOM on a daily average basis off the record export volume shipped in Jun ’14, resulting in the largest monthly percentage decline in NFDM/SMP exports in over three and a half years. On a YOY basis, NFDM/SMP exports increased 1.1%. Over two thirds of July shipments were destined to Southeast Asia and Mexico however after two months of robust shipments to Mexico, shipments to Mexico declined 30.8% MOM and 7.2% YOY. ’13-’14 YTD NFDM/SMP exports are up 19.8% through the first ten months of the production season.
See the table below for a summary of key U.S. dairy product exports as a percentage of production in Jul ’14.