Executive Summary

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

• U.S. commercial disappearance for milk used in all products remained at record high seasonal levels on both a milk-fat and skim-solids basis throughout Aug ’21. Domestic demand increased 3.8% YOY on a milk-fat basis but declined 1.7% YOY on a skim-solids basis throughout the month.
• U.S. butter and cheese disappearance both remained at record high seasonal levels throughout Aug ’21 while whey protein concentrate commercial disappearance also finished above previous year levels. Dry whey commercial disappearance reached a record low seasonal level throughout Aug ’21, however, while nonfat dry milk/skim milk powder commercial disappearance finished at a four year low seasonal level.
• U.S. fluid milk sales finished lower on a YOY basis for the 11^th time in the past 13 months throughout Aug ’21, declining by 1.7% and reaching a record low seasonal level.

Additional Report Details

All Milk – Disappearance Reaches Record High Seasonal Levels on a Milk-Fat and Skim-Solids Basis

According to the USDA, U.S. commercial disappearance for milk used in all products on a milk-fat basis increased YOY for the eighth consecutive month throughout Aug ’21, finishing up 5.0% and reaching a record high seasonal level. Domestic demand increased 3.8% on a YOY basis throughout the month, while export demand finished 33.5% above previous year levels.

’19-’20 annual commercial disappearance for milk used in all products on a milk-fat basis increased 1.0% YOY, reaching a record high level. Domestic disappearance increased 1.1%, also reaching the highest annual figure on record. ’20-’21 YTD commercial disappearance for milk used in all products on a milk-fat basis has increased by an additional 2.8% on a YOY basis heading into the final month of the production season.

U.S. commercial disappearance for milk used in all products on a skim-solids basis increased by 0.8% on a YOY basis throughout Aug ’21, also reaching a record high seasonal level. Export demand increased 10.3% on a YOY basis throughout the month, more than offsetting a 1.7% YOY decline in domestic demand. The YOY decline in skim-solids domestic demand was the third experienced throughout the past four months.

’19-’20 annual commercial disappearance for milk used in all products on a skim-solids basis increased 1.7% YOY, reaching a record high level, despite domestic demand declining by 1.4%. ’20-’21 YTD commercial disappearance for milk used in all products on a skim-solids basis has increased by an additional 2.2% on a YOY basis heading into the final month of the production season.

Butter – Disappearance Reaches a Record High Seasonal Level, up 18.7% YOY

U.S. butter commercial disappearance increased 18.7% on a YOY basis throughout Aug ’21, reaching a record high seasonal level. The YOY increase in butter commercial disappearance was the second experienced in a row and the largest experienced throughout the past six months on a percentage basis. Domestic butter demand increased 17.1% on a YOY basis throughout the month, while export demand finished 90.5% above previous year levels.

’19-’20 annual butter disappearance finished 3.4% higher YOY, reaching a record high level. Domestic disappearance increased 3.6%, also reaching the highest annual figure on record. ’20-’21 YTD butter disappearance has increased by an additional 4.0% on a YOY basis heading into the final month of the production season.

U.S. butter domestic use and export figures outpaced production and import figures throughout Aug ’21, resulting in stocks declining seasonally to a five month low level. Butter stocks typically reach a seasonal peak throughout the month of May, prior to declining seasonally through the month of November.

Cheese – Disappearance Reaches a Record High Seasonal Level, up 4.8% YOY

U.S. cheese commercial disappearance increased 4.8% on a YOY basis throughout Aug ’21, reaching a record high seasonal level. The YOY increase in butter commercial disappearance was the seventh experienced throughout the past eight months. Other-than-American cheese disappearance increased 7.0% on a YOY basis throughout the month while American cheese disappearance finished 1.4% above previous year levels. Domestic cheese demand increased 4.0% on a YOY basis throughout the month, while export demand finished 18.0% above previous year levels.

’19-’20 annual cheese disappearance finished 0.1% above the previous year, reaching a record high level for the 25^th consecutive year. ’20-’21 YTD cheese disappearance has increased by an additional 2.7% on a YOY basis heading into the final month of the production season.

U.S. cheese domestic use and export figures outpaced production and import figures throughout Aug ’21, resulting in stocks declining seasonally to a seven month low level.

Dry Whey – Disappearance Declines to a Record Low Seasonal Level, Down 3.9% YOY

U.S. dry whey commercial disappearance declined 3.9% on a YOY basis throughout Aug ’21, reaching a record low seasonal level. The YOY decline in dry whey commercial disappearance was the fourth experienced in a row. Dry whey export demand declined 17.3% on a YOY basis throughout the month, more than offsetting a 16.3% YOY increase in domestic demand. The YOY increase in domestic dry whey demand was just the second experienced throughout the past 17 months.

’19-’20 annual dry whey disappearance increased 2.1% on a YOY basis from the four year low level experienced throughout the previous production season, despite domestic demand declining by 6.3%. ’20-’21 YTD dry whey disappearance has declined by 3.2% on a YOY basis heading into the final month of the production season, however, and is on pace to reach a six year low level.

U.S. dry whey production and import figures outpaced domestic use and export figures throughout Aug ’21, resulting in stocks rebounding to a six month high level.

WPC – Disappearance Remains Higher YOY for the Fourth Time in Five Months, up 4.6%

U.S. whey protein concentrate (WPC) commercial disappearance increased 4.6% on a YOY basis throughout Aug ’21, remaining above previous year levels for the fourth time in the past five months. Domestic WPC demand increased 4.0% on a YOY basis throughout the month, while export demand finished 5.1% above previous year levels.

’19-’20 annual WPC disappearance declined 4.4% on a YOY basis, reaching a seven year low level. Domestic demand declined 24.4%, reaching an eight year low level. ’20-’21 YTD WPC disappearance has rebounded by 0.2% on a YOY basis heading into the final month of the production season.

U.S. WPC domestic use and export figures outpaced production and import figures throughout Aug ’21, resulting in stocks declining to a four month low level.

NFDM/SMP – Disappearance Reaches a Four Year Low Seasonal Level, Down 16.5% YOY

U.S. nonfat dry milk (NFDM) and skim milk powder (SMP) commercial disappearance declined 16.5% on a YOY basis throughout Aug ’21, reaching a four year low seasonal level. The YOY decline in NFDM/SMP commercial disappearance was the third experienced throughout the past four months. Domestic NFDM/SMP demand declined 63.5% on a YOY basis throughout the month, more than offsetting a 15.4% YOY increase in export demand.

’19-’20 annual NFDM/SMP disappearance increased 9.9% on a YOY basis, reaching a record high level. Domestic demand declined 13.1%, however, reaching an 18 year low level. ’20-’21 YTD NFDM/SMP disappearance has increased by an additional 2.6% on a YOY basis heading into the final month of the production season, despite the most recent decline.

U.S. NFDM/SMP domestic use and export figures outpaced production and import figures throughout Aug ’21, resulting in stocks declining seasonally to a nine month low level.

Aug ’21 increases in domestic commercial disappearance were led by cheese, followed by butter, while declines were most significant for NFDM/SMP. YOY increases in international commercial disappearance were led by NFDM/SMP, while declines were most significant for dry whey.

Fluid Milk – Total Milk Sales Remain at a Record Low Seasonal Level, Down 1.7% YOY

U.S. fluid milk sales finished lower on a YOY basis for the 11^th time in the past 13 months during Aug ’21, declining by 1.7% and remaining at a record low seasonal level. Fluid milk sales have reached record low seasonal levels over five consecutive months through August. Sales of fat-free milk remained particularly weak, declining by 10.1% on a YOY basis throughout the month.

’19-’20 annual total fluid milk sales finished 0.6% above the record low level experienced throughout the previous production season, increasing on a YOY basis for the first time in the past 11 years. Annual fluid milk sales remained 0.2% below previous year levels throughout the 2020 calendar year, however. ’20-’21 YTD fluid milk sales have declined by 3.6% on a YOY basis heading into the final month of the production season and are on pace to reach a record low annual level.

Fat consumed within U.S. fluid milk declined on a YOY basis for the 12^th time in the past 13 months during Aug ’21, finishing down 2.0% and reaching a record low seasonal level. ’19-’20 annual total fat consumed within fluid milk rebounded 1.4% from the four year low level experienced throughout the previous production season, reaching a three year high level. ’20-’21 YTD fat consumed within fluid milk has declined by 4.4% on a YOY basis heading into the final month of the production season, however, and is on pace to reach the lowest annual level on record.