Executive Summary

U.S. dairy commercial disappearance figures provided by the USDA were recently updated with values spanning through Dec ’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 Dec ’21. Domestic demand increased 4.3% YOY on a milk-fat basis and 3.7% on a skim-solids basis throughout the month.
• U.S. butter and cheese disappearance each reached record high seasonal levels throughout Dec ’21, however dry whey, whey protein concentrate and nonfat dry milk/skim milk powder disappearance finished below previous year levels. Dry whey and whey protein concentrate disappearance figures declined to three and four year low seasonal levels throughout the month, respectively, while nonfat dry milk/skim milk powder disappearance reached a seven year low seasonal level.
• U.S. fluid milk sales remained below previous year levels for the 14^th time in the past 16 months throughout Nov ’21, declining by 0.9% and reaching a record low seasonal level.

Additional Report Details

All Milk – Disappearance Reaches Record Seasonal Highs on Both 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 remained at a record high seasonal level for the second consecutive month throughout Dec ’21, finishing 4.6% above previous year levels. The YOY increase in commercial disappearance for milk used in all products on a milk-fat basis was the 11^th experienced throughout the past 12 months. Domestic disappearance increased 4.3% on a YOY basis throughout the month while export demand finished 13.3% above previous year levels.

’20-’21 annual commercial disappearance for milk used in all products on a milk-fat basis increased 2.4% YOY, reaching a record high annual level for the 12^th consecutive year. Domestic disappearance increased 1.7%, also reaching the highest annual figure on record. ’21-’22 YTD disappearance has increased by an additional 2.8% throughout the first quarter of the production season.

U.S. commercial disappearance for milk used in all products on a skim-solids basis increased by 1.8% on a YOY basis throughout Dec ’21, remaining at a record high seasonal level for the third consecutive month. The YOY increase in commercial disappearance for milk used in all products on a skim-solids basis was the sixth experienced throughout the past seven months. Domestic disappearance increased 3.7% on a YOY basis throughout the month, more than offsetting a 6.3% YOY decline in export demand.

’20-’21 annual commercial disappearance for milk used in all products on a skim-solids basis increased 1.7% YOY, reaching a record high annual level for the second consecutive year. Domestic disappearance finished 0.3% below previous year levels, however, reaching a three year low level. ’21-’22 YTD disappearance has increased by an additional 2.0% throughout the first quarter of the production season.

Butter – Disappearance Reaches a Record High Seasonal Level, up 6.8% YOY

U.S. butter commercial disappearance increased 6.8% on a YOY basis throughout Dec ’21, reaching a record high seasonal level. The YOY increase in butter disappearance was the sixth experienced in a row. Domestic butter disappearance increased 6.3% on a YOY basis throughout the month while export demand finished 19.6% above previous year levels.

’20-’21 annual butter disappearance finished 4.1% higher YOY, reaching a record high annual level for the fourth consecutive year. Domestic disappearance increased 1.9%, also reaching the highest annual figure on record. ’21-’22 YTD disappearance has increased by an additional 3.7% throughout the first quarter of the production season.

U.S. butter domestic use and export figures outpaced production and import figures throughout Dec ’21, resulting in stocks declining contraseasonally to a two year low level. Butter stocks typically reach seasonal low levels throughout the month of November, prior to increasing seasonally throughout the month of December and the first half of the following calendar year.

Cheese – Disappearance Remains at a Record High Seasonal Level, up 2.1% YOY

U.S. cheese commercial disappearance increased 2.1% on a YOY basis throughout Dec ’21, remaining at a record high seasonal level for the second consecutive month. The YOY increase in cheese disappearance was the fifth experienced throughout the past six months.

American cheese disappearance increased 4.9% on a YOY basis throughout the month, while other-than-American cheese disappearance finished 0.3% above previous year levels. The YOY increase in American cheese disappearance was the largest experienced throughout the past seven months. Domestic cheese disappearance increased 1.1% on a YOY basis throughout the month while export demand finished 20.1% above previous year levels.

’20-’21 annual cheese disappearance finished 2.4% higher YOY, reaching a record high annual level for the 26^th consecutive year. Domestic disappearance increased 2.3%, also reaching the highest annual figure on record. ’21-’22 YTD disappearance has increased by an additional 3.0% throughout the first quarter of the production season.

U.S. cheese production and import figures outpaced domestic use and export figures throughout Dec ’21, resulting in stocks rebounding seasonally from the ten month low level experienced throughout the previous month.

Dry Whey – Disappearance Declines to a Three Year Low Seasonal Level, Down 3.3% YOY

U.S. dry whey commercial disappearance declined 3.3% on a YOY basis throughout Dec ’21, reaching a three year low seasonal level. The YOY decline in dry whey disappearance was the first experienced throughout the past three months. Dry whey export demand declined 16.3% on a YOY basis throughout the month, more than offsetting a 7.5% YOY increase in domestic demand.

’20-’21 annual dry whey disappearance finished 3.9% below previous year levels, reaching a six year low annual level. Domestic disappearance declined 23.5%, reaching a seven year low level. ’21-’22 YTD disappearance has rebounded by 0.1% throughout the first quarter of the production season, despite the most recent decline.

U.S. dry whey domestic use and export figures outpaced production and import figures throughout Dec ’21, resulting in stocks declining from the previous month.

WPC – Disappearance Declines to a Four Year Low Seasonal Level, Down 4.6% YOY

U.S. whey protein concentrate (WPC) commercial disappearance declined 4.6% on a YOY basis throughout Dec ’21, reaching a four year low seasonal level. The YOY decline in WPC commercial disappearance was just the third experienced throughout the past ten months. WPC export demand declined 46.3% on a YOY basis throughout the month, more than offsetting a 98.7% YOY increase in domestic demand.

’20-’21 annual WPC disappearance finished 0.7% below previous year levels, reaching an eight year low level. Domestic disappearance finished 10.1% below previous year levels, reaching a nine year low annual level. ’21-’22 YTD disappearance has rebounded by 4.6% throughout the first quarter of the production season, despite the most recent decline.

U.S. WPC production and import figures outpaced domestic use and export figures throughout Dec ’21, resulting in stocks rebounding to a three and a half year high level.

NFDM/SMP – Disappearance Declines to a Seven Year Low Seasonal Level, Down 13.9% YOY

U.S. nonfat dry milk (NFDM) and skim milk powder (SMP) commercial disappearance declined 13.9% on a YOY basis throughout Dec ’21, reaching a seven year low seasonal level. The YOY decline in NFDM/SMP disappearance was the sixth experienced throughout the past eight months. NFDM/SMP export demand declined 3.9% on a YOY basis throughout the month while domestic demand finished 29.0% below previous year levels.

’20-’21 annual NFDM/SMP disappearance finished 0.7% higher YOY, reaching a record high annual level for the second consecutive year. Domestic disappearance declined 17.2%, however, reaching a 27 year low annual level. ’21-’22 YTD disappearance has declined by 1.5% throughout the first quarter of the production season.

U.S. NFDM/SMP production and import figures outpaced domestic use and export figures throughout Dec ’21, resulting in stocks rebounding from the previous month.

Dec ’21 increases in domestic commercial disappearance were led by WPC, while declines were most significant for NFDM/SMP. YOY increases in international commercial disappearance were led by cheese, while declines were most significant for WPC.

Fluid Milk – Total Milk Sales Reach a Record Low Seasonal Level, Down 0.9% YOY

U.S. fluid milk sales remained below previous year figures for the 14^th time in the past 16 months throughout Nov ’21, declining by 0.9% and reaching a record low seasonal level. Sales of fat-free milk remained particularly weak, declining by 8.9% on a YOY basis and reaching a record low seasonal level 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. Fluid milk sales remained 0.2% below previous year levels throughout the 2020 calendar year, however. ’20-’21 annual fluid milk sales finished 3.6% below previous year levels, reaching a record low annual level.

Fat consumed within U.S. fluid milk declined on a YOY basis for the 15^th time in the past 16 months throughout Nov ’21, finishing down 1.1% and reaching a record low seasonal level. ’20-’21 annual fat consumed within fluid milk finished 4.2% below the three year high level experienced throughout the previous production season, reaching the lowest annual level on record.