Executive Summary

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

• U.S. butterfat export volumes finished 222.6% higher on a YOY basis throughout Sep ’21, remaining at an eight year high seasonal level for the second consecutive month. The U.S. finished as a net exporter of butterfat for the first time in the past four months throughout Sep ’21.
• U.S. cheese export volumes finished 20.5% higher on a YOY basis throughout Sep ’21, remaining at a record high seasonal level for the third consecutive month. Dry whey and whey protein concentrate export volumes each finished lower on a YOY basis throughout the month, however.
• U.S. nonfat dry milk/skim milk powder export volumes finished 16.2% higher on a YOY basis throughout Sep ’21, remaining at a record high seasonal level for the second consecutive month.

Additional Report Details

Butter – Exports Remain at an Eight Year High Seasonal Level, up 222.6% YOY

According to the USDA, Sep ’21 U.S. export volumes of butterfat finished 222.6% above previous year levels, remaining at an eight year high seasonal level for the second consecutive month. The YOY increase in butterfat export volumes was the tenth experienced in a row and the largest experienced throughout the past five months on a percentage basis. The U.S. finished as a net exporter of butterfat for the first time in the past four months throughout Sep ’21.

’20-’21 annual butterfat export volumes finished 113.3% above the four year low level experienced throughout the previous production season, reaching a seven year high annual level.

Canada continued to be the top destination for U.S. butterfat export volumes throughout Sep ’21, accounting for a fifth of the total export volumes. Canada, China, Bahrain and Singapore combined to account for over half of all butterfat export volumes throughout the month.

Butterfat export volumes destined to China increased most significantly on a YOY basis throughout the month, followed by shipments destined to Bahrain and Singapore, 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 61.8% on a YOY basis throughout the past 12 months however volumes destined to Mexico have declined by 14.3% throughout the period. U.S. butterfat export volumes destined to all other countries have increased by 196.7% throughout the past 12 months, led by increases in volumes destined to Bahrain.

Cheese – Exports Remain at a Record High Seasonal Level, up 20.5% YOY

Sep ’21 U.S. cheese export volumes finished 20.5% above previous year levels, remaining at a record high seasonal level for the third consecutive month. Cheddar cheese export volumes increased 5.6% on a YOY basis throughout the month while other-than-cheddar cheese export volumes finished 22.8% above previous year levels.

’20-’21 annual cheese export volumes finished 4.6% above the previous year levels, reaching a record high annual level for the first time in the past seven years.

Mexico was the top destination for U.S. cheese export volumes throughout Sep ’21, accounting for over a quarter 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 increases in cheese export volumes were led by product destined to Mexico, followed by volumes destined to Japan and Guatemala, while cheese export volumes destined to Australia finished most significantly lower.

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 4.5% on a YOY basis throughout the past 12 months, however.

Whey – Dry Whey & Whey Protein Concentrate Export Volumes Finish Lower YOY

U.S. dry whey export volumes remained below previous year levels for the fourth consecutive month throughout Sep ’21, finishing down 0.2%. Dry whey export volumes had finished higher on a YOY basis over 16 consecutive months through May ’21, prior to declining on a YOY basis over the four most recent months of available data. Despite declining on a YOY basis, Sep ’21 dry whey export volumes remained at the second highest seasonal level experienced throughout the past eight years.

’20-’21 annual dry whey export volumes finished 21.8% above previous year levels, reaching a three year high annual level, despite the recently experienced declines.

U.S. whey protein concentrate (WPC) export volumes declined 23.2% on a YOY basis during Sep ’21, finishing below previous year levels for the first time in the past four months. WPC export volumes reached a four year low seasonal level throughout Sep ’21. The YOY decline in WPC export volumes was the largest experienced throughout the past 29 months on a percentage basis.

’20-’21 annual WPC export volumes finished 6.2% above previous year levels, reaching a three year high annual level, despite the most recent decline.

China continued to be the top destination for U.S. whey export volumes throughout Sep ’21, accounting for over 40% of the total export volumes.

YOY increases in whey export volumes continue to be led by product destined to China, followed by volumes destined to Mexico and the Philippines, while volumes destined to New Zealand finished most significantly lower on a YOY basis throughout the month. YOY increases in modified whey export volumes more than offset lower dry whey and whey protein concentrate 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 70.9% YOY throughout the past 12 months, more than offsetting a 2.4% 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 16.2% YOY

Sep ’21 U.S. export volumes of nonfat dry milk (NFDM) and skim milk powder (SMP) finished 16.2% above previous year levels, remaining at a record high seasonal level for the second consecutive month. The YOY increase in NFDM/SMP export volumes was the seventh experienced throughout the past eight months and the largest experienced throughout the past six months on a percentage basis.

’20-’21 annual NFDM/SMP export volumes finished 8.9% above previous year levels, reaching a record high annual level for the second consecutive year.

Mexico was the top destination for U.S. NFDM/SMP export volumes throughout Sep ’21, accounting for nearly 40% of the total export volumes. Mexico, the Philippines, Indonesia, China and Vietnam combined to account for over three quarters 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 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 18.3% on a YOY basis throughout the past 12 months while volumes destined to all other countries have increased 3.6% YOY over the same period.

Export Volumes Normalized to Production

U.S. butterfat, cheese, dry whey and NFDM/SMP export volumes as a percentage of production all finished above previous year figures during Sep ’21.

Overall, U.S. dairy export volumes were estimated to be equivalent to 17.6% of total U.S. milk-solids production during Sep ’21 while dairy import volumes were estimated to be equivalent to 3.0% of total U.S. milk-solids production. Sep ’21 net dairy trade was estimated to have increased 10.0% on a YOY basis, finishing higher for the 17^th time in the past 18 months.

U.S. dairy exports as a percentage of milk-solids production are estimated to have increased 9.1% on a YOY basis throughout Sep ’21, remaining at a record high seasonal level for the fifth consecutive month. The YOY increase in dairy exports as a percentage of milk-solids production was the eighth experienced in a row.

’20-’21 annual dairy exports as a percentage of milk-solids production finished 8.4% above previous year levels, reaching a record high annual level for the first time in the past three years.

Sep ’21 U.S. dairy imports as a percentage of milk-solids production are estimated to have increased 4.8% on a YOY basis, finishing above previous year levels for the first time in the past five months. Sep ’21 U.S. dairy imports as a percentage of milk-solids production are estimated to have remained at the second lowest seasonal level experienced throughout the past eight years, however.

’20-’21 annual dairy imports as a percentage of milk-solids production finished 9.5% below previous year levels, reaching a ten year low annual level, despite the most recent increase.

Net trade of U.S. NFDM/SMP continued to outpace that of butter, cheese and dry whey as import volumes remain minimal. Net dry whey trade volumes exceeded net cheese trade volumes for the first time in the past five months throughout Sep ’21 while the U.S. finished as a net exporter of butter for the first time in the past four months.