U.S. Dairy Product Production Update – Nov ’16
Executive Summary
U.S. dairy product production figures provided by USDA were recently updated with values spanning through Sep ’16. Highlights from the updated report include:
• Sep ’16 U.S. butter production increased off of seasonal lows experienced throughout the previous month but declined on a YOY basis for the first time in eight months, finishing down 0.4%.
• U.S. cheese production remained strong during Sep ’16, increasing on a YOY basis for the 42nd consecutive month and finishing at a record high volume for the month of September.
• Combined production of U.S. nonfat dry milk and skim milk powder increased sharply on a YOY basis during Sep ’16, finishing up 11.8%.
Additional Report Details
Butter – Production Declines YOY for the First Time in Eight Months, Finishes Down 0.4%
According to USDA, Sep ’16 U.S. butter production of 133.1 million pounds increased 5.8% MOM on a daily average basis from the seasonal lows experienced throughout the previous month but finished 0.4% lower on a YOY basis. The YOY decline in butter production was the first experienced throughout the past eight months while the seasonal increase in butter production was less than the ten year average August – September increase of 7.7%. YOY declines in butter production were led by the Western U.S., which fell 5.4%, more than offsetting YOY gains in Central and Atlantic butter production of 2.8% and 13.9%, respectively. ’14-’15 annual butter production increased 0.3% YOY while ’15-’16 annual butter production finished up an additional 3.3%, reaching a new record annual high.
Cheese – Production Reaches Record High for the Month of September, Finishes up 1.6% YOY
Sep ’16 total U.S. cheese production of 981.2 million pounds increased on a YOY basis for the 42nd consecutive month, finishing 1.6% above the previous year and reaching a new record high production level for the month of September. Cheddar cheese production of 270.2 million pounds declined 0.5% YOY however other-than-cheddar cheese production increased 2.4% YOY throughout the month. ’14-’15 annual total cheese production finished up 3.3% YOY while ’15-’16 annual cheese production increased an additional 2.0% to a new record annual high, despite cheddar cheese production remaining flat throughout the period.
Dry Whey – Production Remains Lower YOY, Finishes Down 6.0% YOY
Sep ’16 U.S. dry whey production of 74.5 million pounds increased 0.8% MOM on a daily average basis but remained lower YOY, finishing down 6.0%. Combined whey protein concentrate (WPC) and whey protein isolate (WPI) production also remained lower on a YOY basis, declining by 3.5% throughout the month. Combined WPC and WPI production has declined on a YOY basis for 22 consecutive months through September. Combined dry whey, WPC and WPI production declined 5.0% YOY during Sep ’16, finishing lower for the eighth consecutive month. ’15-’16 annual dry whey production finished up 3.0% YOY, however combined production of dry whey, WPC and WPI declined 1.1%.
NFDM/SMP – Combined Production Increases Sharply YOY, Finishes up 11.8%
Sep ’16 U.S. nonfat dry milk (NFDM) production of 125.6 million pounds increased 10.3% MOM on a daily average basis while also finishing 4.7% higher YOY. The YOY increase in NFDM production was the first experienced throughout the past 12 months while the MOM gain was a contraseasonal move when compared to the ten year average August – September seasonal decline of 11.6%. Skim milk powder (SMP), which is more suited to the requirements of most global markets, increased YOY for the 11th consecutive month, as production of 38.4 million pounds finished 43.3% above the previous year. Overall, Sep ’16 combined production of NFDM and SMP increased by 11.8% on a YOY basis, which was the largest growth rate experienced in 21 months. Despite the increase, ’15-’16 annual combined production of NFDM and SMP finished 2.3% lower.
Overall, SMP production continued to increase most significantly YOY on a percentage basis during Sep ’16 while dry whey production declined most significantly on a percentage basis throughout the month.
Cheese – Production Reaches Record High for the Month of September, Finishes up 1.6% YOY
Sep ’16 total U.S. cheese production of 981.2 million pounds increased on a YOY basis for the 42nd consecutive month, finishing 1.6% above the previous year and reaching a new record high production level for the month of September. Cheddar cheese production of 270.2 million pounds declined 0.5% YOY however other-than-cheddar cheese production increased 2.4% YOY throughout the month. ’14-’15 annual total cheese production finished up 3.3% YOY while ’15-’16 annual cheese production increased an additional 2.0% to a new record annual high, despite cheddar cheese production remaining flat throughout the period.
Dry Whey – Production Remains Lower YOY, Finishes Down 6.0% YOY
Sep ’16 U.S. dry whey production of 74.5 million pounds increased 0.8% MOM on a daily average basis but remained lower YOY, finishing down 6.0%. Combined whey protein concentrate (WPC) and whey protein isolate (WPI) production also remained lower on a YOY basis, declining by 3.5% throughout the month. Combined WPC and WPI production has declined on a YOY basis for 22 consecutive months through September. Combined dry whey, WPC and WPI production declined 5.0% YOY during Sep ’16, finishing lower for the eighth consecutive month. ’15-’16 annual dry whey production finished up 3.0% YOY, however combined production of dry whey, WPC and WPI declined 1.1%.
NFDM/SMP – Combined Production Increases Sharply YOY, Finishes up 11.8%
Sep ’16 U.S. nonfat dry milk (NFDM) production of 125.6 million pounds increased 10.3% MOM on a daily average basis while also finishing 4.7% higher YOY. The YOY increase in NFDM production was the first experienced throughout the past 12 months while the MOM gain was a contraseasonal move when compared to the ten year average August – September seasonal decline of 11.6%. Skim milk powder (SMP), which is more suited to the requirements of most global markets, increased YOY for the 11th consecutive month, as production of 38.4 million pounds finished 43.3% above the previous year. Overall, Sep ’16 combined production of NFDM and SMP increased by 11.8% on a YOY basis, which was the largest growth rate experienced in 21 months. Despite the increase, ’15-’16 annual combined production of NFDM and SMP finished 2.3% lower.
Overall, SMP production continued to increase most significantly YOY on a percentage basis during Sep ’16 while dry whey production declined most significantly on a percentage basis throughout the month.