CHART: Cheese Trade Volumes Quietly Climb

Strong demand from developing nations (and the United States) is driving cheese exports, despite Russia’s ongoing embargo.

When Russia slapped its dairy embargo on the West in the summer of 2014, cheese exports were one of the hardest hit categories. From 2013-2015, Russian cheese imports fell by more than 210,000 tons (excluding trade with neighbor Belarus), severely disrupting trade flows and heightening competition for alternate markets, particularly among EU and U.S. suppliers.

While the rising cheese import trend lines in Japan, Mexico, South Korea and the United States pale in comparison to the dramatic decline from Russia on the chart below, trade data indicates a resilience in cheese volumes that few expected two years after sanctions.

 Cheese Imports:  12-Month Moving Average

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September trade data from the top buyers, apart from Mexico (see table below from the November issue of USDEC’s Global Dairy Market Outlook), largely disappointed, but the trend through three quarters (building on a solid 2015) is understatedly positive. Excluding Russia, the world’s top three cheese importers—Japan, the United States and Mexico—are on pace for record purchasing through the first nine months of 2016. South Korea, the No. 4 buyer—is just off the record it set in 2015.

Outside the top 5, the gains are even more impressive. Southeast Asian cheese imports (excluding Vietnam) were up 13 percent to more than 62,000 tons in the first seven months of the year compared to the same period in 2015. Brazil’s cheese buying nearly doubled to more than 30,000 tons through September.

Chinese cheese imports grew 28 percent to 75,581 tons in the first nine months of 2016 vs. January-September 2015—in line with its compound annual growth rate since 2008. If that trend continues, and there is no reason to think it would not, China could supplant Australia as the world’s No. 6 buyer by year’s end and catch Mexico and South Korea in 2017.

Emerging markets haven’t fully made up for the total decline in Russian cheese purchasing, and sharp drops in cheese buying in countries like Venezuela and Egypt, where political and economic unrest have eroded purchasing power, continue to complicate the global picture. But the developing world’s emergent appetite for cheese is evident and widespread and bodes well for cheese suppliers willing to cater to that demand.

Editor's note: The analysis on this page is based on data available on November 22. 

Learn more about global dairy markets:

• November's Dairy Data Dashboard
• Milk Powder, Whey Products Highlight September Trade Data
• Chart: Global Milk Supply Tightens, For Now
• October's Dairy Data Dashboard
• U.S. Dairy Exports Move Into Positive Territory
• Dairy Commodity Price Movements Bode Well for U.S. Suppliers

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The U.S. Dairy Export Council fosters collaborative industry partnerships with processors, trading companies and others to enhance global demand for U.S. dairy products and ingredients. USDEC is primarily supported by Dairy Management Inc. through the dairy farmer checkoff. How to republish this post.