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U.S. Dairy Exports Decline YOY for Fifth Consecutive Month…

  • February 5, 2015
  • by wbabler
According to USDA, the total value of all U.S. dairy exports in Dec ’14 declined YOY for the fifth consecutive month, falling 20.8%. The Aug ’14 – Dec ’14 YOY declines were the first experienced in over a year and a half, with the Dec ’14 YOY decline being the largest in over five years. The total value of all U.S. dairy exports also declined MOM, down 7.5% vs. Nov ’14 figures on a daily average basis. Total US Dairy Exports - Feb Butter – Export Volumes Remain Weak, Down 61.0% YOY Dec ’14 export volumes of butterfat increased 29.9% MOM on a daily average basis but continued to decline YOY, down 61.0% and 24.5% vs. the five year average December butterfat export volumes. Butterfat exports began to slow in the second quarter of 2014, with 2Q ’14 export sales 36.2% below 1Q ’14 export sales on a daily average basis. YOY butterfat exports have declined for eight consecutive months, with total volumes down 56.0% over the period. U.S. butterfat exports to Middle Eastern and Northern African countries were particularly weak, especially in Saudi Arabia, Morocco and Egypt as combined exports declined 89.4% YOY in Dec ’14. Exports to Saudi Arabia, Morocco and Egypt accounted for over a third of the total U.S. butterfat exports in December of last year. It has been speculated that EU-28 butter could displace U.S. butter in the Middle East due to the Russian dairy import ban that was announced in early August. Russia accounted for nearly a third of EU-28 butter exports in 2013. Monthly US Butterfat Exports - Feb U.S. butter prices have traded at a premium to Europe and New Zealand butter prices when adjusted to 80% butterfat since May, reducing export demand. The spreads peaked in Sep ’14, with U.S. butter prices trading at an 80.6% premium to European prices and a 128.1% premium to Oceania prices. Domestic butter price premiums have declined throughout the fourth quarter of 2014, but prices have remained at a premium to international prices. Cheese – Export Volumes Rebound Off 21 Month Low, Remain Down 11.8% YOY Dec ’14 U.S. cheese exports rebounded 8.5% MOM on a daily average basis off of the 21 month low experienced in Nov ’14, but remained lower on a YOY basis, down 11.8%. The YOY decline was the third in a row after 16 consecutive months of YOY gains were experienced from Jun ’13 to Sep ’14. Cheddar cheese exports were particularly weak on a YOY basis, down 34.1%. Similarly to butter exports, cheese exports to Middle Eastern and North African countries were weak, with combined shipments to Saudi Arabia, Morocco and Egypt down 80.6% YOY. Monthly US Cheese Exports - Feb Dry Whey – YOY Exports Decline for Seventh Consecutive Month, Finish Down 9.4% Dec ’14 export volumes of dry whey declined 9.4% YOY and 4.7% MOM on a daily average basis. YOY dry whey export volumes have declined for seven consecutive months after beginning the ’13-’14 production season with YOY increases in seven of the first eight months. The 9.4% YOY decline was less than the 12.6% average YOY decline over the period due to a lower than average November – December seasonal decline in export volumes. Dec ’14 export volumes declined by 1.7 million lbs on a daily average basis, considerably less than the five year average November – December seasonal decline of 4.6 million lbs. Monthly US Dry Whey Exports - Feb NFDM/SMP – YOY Exports Decline for Fifth Consecutive Month, Finish Down 22.8% YOY Dec ’14 export volumes of NFDM/SMP declined 22.8% YOY and 22.5% MOM on a daily average basis. NFDM/SMP exports have declined for five consecutive months after increasing for 15 of the 16 months leading up to Aug ’14. Total volumes have declined by 18.7% over the period. YOY declines persisted despite export volumes to Mexico remaining strong, up 12.8% over the five month period. U.S. NFDM/SMP exports to Mexico accounted for nearly half of all Dec ’14 shipments. NFDM/SMP exports to China have weakened considerably, down 57.7% from Sep ’14 – Dec ’14 and down 72.1% over the past three months. Monthly US NFDM-SMP Exports - Feb See the chart below for a summary of key U.S. dairy product exports as a percentage of production in Dec ’14 vs. a year ago. US Dairy Exports, percentage of Production - Feb
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