Executive Summary

U.S. dairy export figures provided by the USDA were recently updated with values spanning through Jun ’21. Highlights from the updated report include:

• U.S. butterfat export volumes finished 64.4% higher on a YOY basis throughout Jun ’21, reaching a seven year high seasonal level. Butterfat import volumes exceeded export volumes for the first time in the past three months, however.
• U.S. cheese export volumes declined on a YOY basis for the second consecutive month throughout Jun ’21, finishing down 13.1%, while dry whey export volumes declined 2.3% on a YOY basis, finishing below previous year levels for the first time in the past 17 months. Whey protein concentrate export volumes increased 0.9% on a YOY basis, however, finishing higher for the first time in the past three months.
• U.S. nonfat dry milk/skim milk powder export volumes increased 7.4% on a YOY basis throughout Jun ’21, remaining at a record high seasonal level for the fifth consecutive month.

Additional Report Details

Butter – Exports Finish at a Seven Year High Seasonal Level, up 64.4% YOY

According to the USDA, Jun ’21 U.S. export volumes of butterfat declined to a four month low level but remained 64.4% above previous year levels, reaching a seven year high seasonal level. The YOY increase in butterfat export volumes was the seventh experienced in a row but the smallest experienced throughout the seven month period. Butterfat import volumes exceeded export volumes for the first time in the past three months throughout Jun ’21.

’19-’20 annual butterfat export volumes declined 24.1% on a YOY basis, reaching a four year low level. ’20-’21 YTD butterfat export volumes have rebounded by 100.2% on a YOY basis throughout the first three quarters of the production season, however, and are on pace to reach a seven year high level.

Canada continued to be the top destination for U.S. butterfat export volumes throughout Jun ’21, accounting for over a third of the total export volumes. Canada, Bahrain and Australia combined to account for just under two thirds 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 Bahrain and Australia, while butterfat export volumes destined to Saudi Arabia 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 51.4% on a YOY basis throughout the past 12 months however volumes destined to Mexico have declined by 26.0% throughout the period. U.S. butterfat export volumes destined to all other countries have increased by 148.2% throughout the past 12 months, led by increases in volumes destined to Bahrain.

Cheese – Exports Remain Lower YOY for the Second Consecutive Month, Down 13.1%

Jun ’21 U.S. cheese export volumes rebounded from the previous month but remained 13.1% below previous year levels, finished lower on a YOY basis for the second consecutive month. Cheddar cheese export volumes declined 19.2% on a YOY basis throughout the month while other-than-cheddar cheese export volumes finished 12.1% lower YOY.

’19-’20 annual cheese export volumes increased 2.4% on a YOY basis, reaching a six year high level. ’20-’21 YTD cheese export volumes have declined by 0.9% on a YOY basis throughout the first three quarters of the production season, however.

Mexico was the top destination for U.S. cheese export volumes throughout Jun ’21, accounting for nearly a third of the total export volumes. Mexico, South Korea and Japan combined to account for over half of all cheese export volumes throughout the month.

YOY declines in cheese export volumes were led by product destined to South Korea, followed by volumes destined to Mexico and Japan, while cheese export volumes destined to Honduras finished most significantly higher.

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 declined 1.2% on a YOY basis throughout the past 12 months, however.

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

U.S. dry whey export volumes declined on a YOY basis for the first time in the past 17 months during Jun ’21, finishing down 2.3%. Dry whey export volumes had finished lower on a YOY basis over 17 consecutive months through Jan ’20, prior to finishing above previous year levels over 16 consecutive months through May ’21.

’19-’20 annual dry whey export volumes rebounded 15.6% on a YOY basis from the 15 year low level experienced throughout the previous production season. ’20-’21 YTD dry whey export volumes have increased by an additional 35.3% on a YOY basis throughout the first three quarters of the production season and are on pace to reach a three year high level, despite the most recent decline.

U.S. whey protein concentrate (WPC) export volumes increased 0.9% on a YOY basis during Jun ’21, finishing above previous year levels for the first time in the past three months. ’19-’20 annual WPC export volumes increased 18.4% on a YOY basis while ’20-’21 YTD export volumes have increased an additional 10.0% YOY throughout the first three quarters of the production season.

China continued to be the top destination for U.S. whey export volumes throughout Jun ’21, accounting for over half of the total export volumes.

YOY increases in whey export volumes continue to be led by product destined to China, while volumes destined to New Zealand finished most significantly lower on a YOY basis throughout the month. YOY increases in modified whey export volumes and whey protein concentrate volumes more than offset lower dry whey export volumes throughout the month.

China has historically been the largest importer of U.S. whey products, accounting for nearly 40% of the total U.S. whey export volumes throughout the past five years. U.S. whey export volumes destined to China have increased 110.0% YOY throughout the past 12 months, more than offsetting a 4.5% YOY decline in whey export volumes destined to all other countries over the same period.

NFDM/SMP – Exports Remain at a Record High Seasonal Level, up 7.4% YOY

Jun ’21 U.S. export volumes of nonfat dry milk (NFDM) and skim milk powder (SMP) remained at a record high seasonal level for the fifth consecutive month, finishing 7.4% above previous year volumes. NFDM/SMP export volumes finished at the third highest monthly level on record throughout Jun ’21. The YOY increase in NFDM/SMP export volumes was the smallest experienced throughout the past five months, however.

’19-’20 annual NFDM/SMP export volumes increased 25.4% on a YOY basis, reaching a record high level. ’20-’21 YTD NFDM/SMP export volumes have increased by an additional 8.9% on a YOY basis throughout the first three quarters of the production season.

Mexico was the top destination for U.S. NFDM/SMP export volumes throughout Jun ’21, accounting for over one third of the total export volumes. Mexico, Indonesia and the Philippines combined to account for nearly two thirds of all NFDM/SMP export volumes throughout the month.

YOY increases in NFDM/SMP export volumes were led by product destined to Mexico, followed by volumes destined to Indonesia and China, while export volumes destined to Honduras and the Philippines finished most significantly lower 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 5.9% on a YOY basis throughout the past 12 months while volumes destined to all other countries have increased 15.4% YOY over the same period.

Export Volumes Normalized to Production

U.S. butterfat and NFDM/SMP export volumes as a percentage of production finished above previous year figures during Jun ’21 while cheese and dry whey export volumes as a percentage of production finished lower YOY.

Overall, U.S. dairy export volumes were estimated to be equivalent to 17.8% of total U.S. milk-solids production during Jun ’21 while dairy import volumes were estimated to be equivalent to 3.2% of total U.S. milk-solids production. Jun ’21 net dairy trade was estimated to have increased 1.9% on a YOY basis, finishing higher for the 14^th time in the past 15 months.

U.S. dairy exports as a percentage of milk-solids production are estimated to have increased 0.4% on a YOY basis throughout Jun ’21, remaining at a record high seasonal level for the second consecutive month. The YOY increase in dairy exports as a percentage of milk-solids production was the fifth experienced in a row but the smallest experienced throughout the five month period.

’19-’20 annual exports as a percentage of milk-solids production finished 11.8% above previous year levels but remained below the ’17-’18 record high figures. ’20-’21 YTD exports as a percentage of milk-solids production have increased by an additional 8.1% on a YOY basis throughout the first three quarters of the production season and are on pace to reach a record high annual level.

Jun ’21 U.S. dairy imports as a percentage of milk-solids production are estimated to have declined 5.6% on a YOY basis, finishing lower for the sixth time in the past seven months. ’19-’20 annual imports as a percentage of milk-solids production finished 0.6% above previous year levels however ’20-’21 YTD imports as a percentage of milk-solids production have declined by 7.7% on a YOY basis throughout the first three quarters 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 just the third time in the past 11 months throughout Jun ’21 while the U.S. finished as a net importer of butter for the first time in the past three months.