US dairy exports set to record stellar year
Skimmed milk powder shipments reached 689,000 tons through October
30 December 2021
2 minute read
Despite the logistical challenges posed by the COVID-19 pandemic, US dairy exports are set to record a stellar year, led by shipments of skimmed milk powder (SMP), cheese, and butter. SMP shipments through October have already reached 689,000 tons. According to the US Department of Agriculture (USDA) World Markets and Trade report, shipments accounted for nearly one third of the $6.4 billion of dairy exports.
For the year, SMP exports are forecast to reach a record 887,000 tons – up almost 10% – over 2020. For 2022, growth is anticipated to moderate with exports set to grow by 3% to reach 917,000 tons.
Global prices of SMP have been rebounding recently as a result of lackluster milk production in Oceania and the EU. SMP prices in these regions are currently hovering around $1.60-$1.65 per pound. While US prices remain competitive, import demand is expected to be tempered as food processors seek more cost-effective substitutes, said the report.
One notable trend is that US global market share of SMP among major exporters has been steadily climbing from around 30% in 2015 and is forecast to reach 41% in 2022. Since 2014, the EU has been the dominant supplier; however, this year US exports of SMP are expected to surpass EU shipments. This trend is likely to persist into next year as US milk production is expected to continue to grow.
Exports of other dairy products such as cheese and butter have also posted strong gains this year. In the case of cheese, shipments this year are expected to grow by 16% to reach a record 412,000 tons.
US butter has also been highly sought after as it is highly competitive in a tight global market. Recent Oceania prices have been around $2.65 per pound while EU prices have been higher. Exports of US butter this year are expected to more than double from last year to reach 60,000 tons, said the report.
