U.S. Dairy Exports Decline YOY for Tenth Consecutive Month…
According to USDA, the total value of all U.S. dairy exports declined YOY for the tenth consecutive month in May ’15, finishing 26.2% below the previous year. The total value of all U.S. dairy exports also declined MOM on a daily average basis, falling 9.6% from the eight month high experienced in Apr ’15. U.S. dairy product price premiums increased throughout May ’15 while export volumes continue to be negatively affected by a strengthening dollar relative to the currencies of traditional buyers of U.S. dairy products. A strengthening dollar results in less purchasing power for importing countries, and ultimately less foreign demand for U.S. products, all other factors being equal.
Butter – Export Volumes Decline to Five and a Half Year Low, Finish Down 70.9% YOY
May ’15 export volumes of butterfat remained weak, declining by 70.9% YOY and 36.2% MOM on a daily average basis to a new five and a half year low. Butterfat exports began to slow in the second quarter of 2014 and have remained lower YOY for 13 consecutive months, with total volumes down 63.1% over the period. The U.S. was a net importer of butter for the fourth consecutive month in May ’15, while net butter trade declined to a five month low.
U.S. butter prices have traded at a premium to Europe and New Zealand butter prices when adjusted to 80% butterfat since May ’14, reducing export demand. The spreads peaked in Sep ’14, with U.S. butter prices trading at an 80.6% premium to European prices and a 128.1% premium to Oceania prices. Domestic butter price premiums declined throughout the fourth quarter of 2014 and into 2015, but have begun to increase once again throughout recent months. ’14-’15 YTD butterfat exports are down 72.6% YOY through the first two thirds of the production season.
Cheese – YOY Export Volumes Remain Lower on Weak Cheddar Cheese Demand
May ’15 U.S. cheese export volumes remained lower on a YOY basis for the eighth consecutive month, finishing down 7.6% while also declining 10.2% MOM on a daily average basis. Cheddar cheese exports remained particularly weak, declining 47.1% YOY. U.S. cheddar cheese prices traded at a premium to Oceania cheddar cheese prices throughout Apr ’15 for the first time in five months, with the U.S. price premium continuing to strengthen into May ’15. Apr ’15 cheese volumes destined to Mexico remained higher on a YOY basis, increasing by 46.6%, however volumes shipped to all other destinations declined 19.6% YOY. ’14-’15 YTD cheese exports are down 9.7% YOY through the first two thirds of the production season, with cheddar cheese exports down 48.8% over the same period.
Dry Whey – Exports Decline YOY for 12th Consecutive Month, Finish Down 11.1%
May ’15 export volumes of dry whey increased 11.2% MOM on a daily average basis to an 11 month high but remained lower YOY, finishing down 11.1%. The MOM increase was slightly higher than the five year average April – May seasonal increase of 8.7%. YOY dry whey export volumes have declined for 12 consecutive months after beginning the ’13-’14 production season with YOY increases in seven of the first eight months, with total volumes declining by 16.6% over the period. ’14-’15 YTD dry whey exports are down 18.4% YOY through the first two thirds of the production season.
NFDM/SMP –Exports Continue to Increase, Reach Second Highest Figure on Record
May ’15 export volumes of NFDM/SMP continued to increase, finishing up 0.4% YOY and 2.2% MOM on a daily average basis. May ’15 export volumes were a record high for the month of May and the second highest monthly figure ever recorded. U.S. powder prices continue to remain competitive in global markets, trading downward over recent months along with Oceania and Europe powder prices. U.S. NFDM/SMP exports to Mexico declined by 25.3% YOY, however exports to the Philippines and Indonesia increased significantly YOY, finishing up 34.2% and 55.7%, respectively. Shipments to the aforementioned countries accounted for over half of the total May ’15 NFDM/SMP exports. Despite the recent increases, ’14-’15 YTD NFDM/SMP exports remain down 5.7% YOY through the first two thirds of the production season.
Overall, U.S. dairy export volumes were equivalent to approximately 15.4% of total U.S. milk solids production in May ’15, down from the ten month high 16.7% of total U.S. milk solids production experienced in Apr ’15.
May ’15 U.S. butterfat, cheese and dry whey exports as a percentage of production remained lower than the previous year while U.S. NFDM/SMP exports as a percentage of production increased YOY.
Butter – Export Volumes Decline to Five and a Half Year Low, Finish Down 70.9% YOY
May ’15 export volumes of butterfat remained weak, declining by 70.9% YOY and 36.2% MOM on a daily average basis to a new five and a half year low. Butterfat exports began to slow in the second quarter of 2014 and have remained lower YOY for 13 consecutive months, with total volumes down 63.1% over the period. The U.S. was a net importer of butter for the fourth consecutive month in May ’15, while net butter trade declined to a five month low.
U.S. butter prices have traded at a premium to Europe and New Zealand butter prices when adjusted to 80% butterfat since May ’14, reducing export demand. The spreads peaked in Sep ’14, with U.S. butter prices trading at an 80.6% premium to European prices and a 128.1% premium to Oceania prices. Domestic butter price premiums declined throughout the fourth quarter of 2014 and into 2015, but have begun to increase once again throughout recent months. ’14-’15 YTD butterfat exports are down 72.6% YOY through the first two thirds of the production season.
Cheese – YOY Export Volumes Remain Lower on Weak Cheddar Cheese Demand
May ’15 U.S. cheese export volumes remained lower on a YOY basis for the eighth consecutive month, finishing down 7.6% while also declining 10.2% MOM on a daily average basis. Cheddar cheese exports remained particularly weak, declining 47.1% YOY. U.S. cheddar cheese prices traded at a premium to Oceania cheddar cheese prices throughout Apr ’15 for the first time in five months, with the U.S. price premium continuing to strengthen into May ’15. Apr ’15 cheese volumes destined to Mexico remained higher on a YOY basis, increasing by 46.6%, however volumes shipped to all other destinations declined 19.6% YOY. ’14-’15 YTD cheese exports are down 9.7% YOY through the first two thirds of the production season, with cheddar cheese exports down 48.8% over the same period.
Dry Whey – Exports Decline YOY for 12th Consecutive Month, Finish Down 11.1%
May ’15 export volumes of dry whey increased 11.2% MOM on a daily average basis to an 11 month high but remained lower YOY, finishing down 11.1%. The MOM increase was slightly higher than the five year average April – May seasonal increase of 8.7%. YOY dry whey export volumes have declined for 12 consecutive months after beginning the ’13-’14 production season with YOY increases in seven of the first eight months, with total volumes declining by 16.6% over the period. ’14-’15 YTD dry whey exports are down 18.4% YOY through the first two thirds of the production season.
NFDM/SMP –Exports Continue to Increase, Reach Second Highest Figure on Record
May ’15 export volumes of NFDM/SMP continued to increase, finishing up 0.4% YOY and 2.2% MOM on a daily average basis. May ’15 export volumes were a record high for the month of May and the second highest monthly figure ever recorded. U.S. powder prices continue to remain competitive in global markets, trading downward over recent months along with Oceania and Europe powder prices. U.S. NFDM/SMP exports to Mexico declined by 25.3% YOY, however exports to the Philippines and Indonesia increased significantly YOY, finishing up 34.2% and 55.7%, respectively. Shipments to the aforementioned countries accounted for over half of the total May ’15 NFDM/SMP exports. Despite the recent increases, ’14-’15 YTD NFDM/SMP exports remain down 5.7% YOY through the first two thirds of the production season.
Overall, U.S. dairy export volumes were equivalent to approximately 15.4% of total U.S. milk solids production in May ’15, down from the ten month high 16.7% of total U.S. milk solids production experienced in Apr ’15.
May ’15 U.S. butterfat, cheese and dry whey exports as a percentage of production remained lower than the previous year while U.S. NFDM/SMP exports as a percentage of production increased YOY.