Overall Volume Up on Record WPC Exports

Large WPC sales to China help offset declines in NDM/SMP, cheese and butterfat.

U.S. exporters shipped 161,882 tons of milk powders, cheese, butterfat, whey and lactose in June, up 5 percent from a year ago and the highest figure since May 2015. Gains were led by record shipments of whey protein concentrate, offsetting declines in all the other major categories.

Exporters shipped 27,926 tons of WPC in June, up 52 percent from a year ago. China bought a record 14,751 tons (+57 percent) and another 4,346 tons (+55 percent) went to Southeast Asia. Whey protein isolates also registered a double-digit gain against June 2015, up 13 percent, led by a boost in sales to Canada. Meanwhile, exports of dry whey were down 2 percent from last year. All told, total shipments of whey products were 47,479, the most ever, and up 25 percent from last year.

Exports of nonfat dry milk/skim milk powder, cheese, butterfat and lactose, on the other hand, continue to lag.

NDM/SMP exports in June were 42,569 tons, down 9 percent year-over-year. Sales to Mexico and Southeast Asia were down 6 percent and 26 percent, respectively. USDA reported whole milk powder exports of 9,311 tons, more than triple what was sold last year. Nearly all of this volume was reportedly sold to Mexico, however, Mexican import data doesn’t corroborate this and we believe USDA’s volume is overstated, likely sales that were misclassified at the port.

With U.S. cheese prices at a sizeable premium to the world market, cheese exports remained below year-earlier levels during June. Shipments totaled 23,041 metric tons, 12 percent less than last year and 32 percent below two years ago. Sales to South Korea and the Middle East/North Africa region were each off by more than a third.

Butterfat exports faced the same price-competitive pressure, with U.S. prices well above world market levels. Exports totaled just 992 tons, down 33 percent from June 2015.

Among other products, lactose exports were off 6 percent, milk protein concentrate exports were down 20 percent, fluid milk shipments were down 24 percent and food preps (blends) volume was up 26 percent compared with a year ago.

On a total milk solids basis, U.S. exports were equivalent to 14.9 percent of U.S. milk production in June, the highest since April 2015. Imports were equivalent to 4.1 percent of production.

First-half recap:

This year marks the second straight year of declining U.S. dairy exports. In the first half of 2016, overall U.S. export volume of milk powders, cheese, butterfat, whey and lactose was down 7 percent from last year and down 17 percent from two years ago. Total export value was $2.23 billion, down 22 percent from first half 2015 and 43 percent from first half 2014.

NDM/SMP exports in the first half reached 258,106 tons, down 11 percent from H1-2015. Sales to Mexico were flat, while shipments to Southeast Asia (-17 percent), China (-52 percent) and Pakistan (-12 percent) were lower.

Cheese exports in the first half were 139,950 tons, down 20 percent from H1-2015. Large declines in sales to South Korea (-47 percent), Japan (-26 percent) and the Middle East/North Africa region (-22 percent) dragged down the totals. Sales to Mexico were down slightly vs. a year ago.

Butterfat exports in the first half were just 12,705 tons, down 1 percent from H1-2015. The bulk of the volume went to Mexico, while shipments to the MENA region were off 78 percent.

Total whey exports in the first half were 230,514 tons, down 3 percent from H1-2015. Sales to China were down 10 percent, with gains in WPC offset by declines in dry whey and WPI. Meanwhile, exports to Southeast Asia were down 4 percent year-over-year.

In the first half, exports of WPC were up 15 percent, but sales of dry whey and WPI were down 17 percent and 29 percent, respectively.

Lactose exports in the first half were 175,086 tons, down 1 percent from H1-2015. Increased sales to Japan were offset by lower volume to China and Southeast Asia.

In the first half, U.S. exports were equivalent to 13.3 percent of U.S. milk solids production, down from 14.5 percent in the first half of 2015.

To use interactive charts with current and historical trade data, see usdec.org's page on U.S. export data.

To download a printable pdf summary of the June trade data, click here.

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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.