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Tag: dairy exports
2023 CWT-Assisted Export Sales Totaled 107.7 Million Pounds as Category Volumes Rise
CWT-assisted dairy product sales contracts in 2023 totaled 58.4 million pounds of American-type cheese, 1.1 million pounds of butter, 46,000 pounds of anhydrous milkfat, 9.1 million pounds of cream cheese and 39.0 million pounds of whole milk powder. This brings the total milk equivalent for the year to 922.1 million pounds on a milkfat basis, equal to 107.7 million pounds on a product volume basis. Product destinations include Aisa, Central America, the Caribbean, Middle East-North Africa, Oceania and South America.
Apart from cheese, all CWT supported products increased sales volumes through the program in 2023. Notably, CWT-assisted butter sales rose 73% and whole milk powder gained 27%. CWT supported sales also reached more countries than the year before – helping more consumers around the world access high-quality, U.S. dairy products.
CWT member cooperatives secured 55 contracts in December, adding 12.4 million pounds of American-type cheeses, 20,000 pounds of anhydrous milkfat, and 827,000 pounds of cream cheese to CWT-assisted sales in 2023. In milk equivalent, this is equal to 121.3 million pounds of milk on a milkfat basis. These products will go to customers in Asia, Middle East-North Africa, Oceania and South America and will be shipped from December 2023 through May 2024.
Exporting dairy products is critical to the viability of dairy farmers and their cooperatives across the country. Whether or not a cooperative is actively engaged in exporting cheese, butter, anhydrous milkfat, cream cheese, or whole milk powder, moving products into world markets is essential. CWT provides a means to move domestic dairy products to overseas markets by helping to overcome U.S. dairy’s trade disadvantages.
The amounts of dairy products and related milk volumes reflect current contracts for delivery, not completed export volumes. CWT will pay export assistance to the bidders only when export and delivery of the product is verified by the submission of the required documentation.
USMCA Dispute Panel Limits Canadian Market Access
Today’s ruling by a U.S-Mexico-Canada Agreement (USMCA) dispute panel allowing Canada to restrict the dairy access that the United States negotiated for in the USMCA pact weakens the agreement’s value to the US dairy industry, according to the National Milk Producers Federation and the U.S. Dairy Export Council.
An earlier panel ruled in January 2022 that Canada had improperly restricted access to its market for U.S. dairy products. In response, Canada made insufficient changes to its dairy tariff rate quota (TRQ) system, resulting in an outcome that still fell far short of the market access the U.S. expected to receive under USMCA. To address that shortcoming, the U.S. brought a second case to challenge the changes that Canada instituted. Today the panel announced that Canada was not obligated to make further changes.
“It is profoundly disappointing that the dispute settlement panel has ruled in favor of obstruction of trade rather than trade facilitation,” said Jim Mulhern, president and CEO of NMPF. “Despite this independent panel’s adverse ruling, we’d like to thank the Biden Administration and the many members of Congress who supported us for their tireless pursuit of justice for America’s dairy sector. We urge Ambassador Tai and Secretary Vilsack to look at all available options to ensure that Canada stops playing games and respects what was negotiated.”
Since the U.S. Trade Representative initially launched the first dispute settlement case against Canada in 2021, USDEC and NMPF have worked with USTR, USDA, and Congress to try to secure full use and value of USMCA’s dairy TRQs for American dairy producers and processors.
“By allowing Canada to ignore its USMCA obligations, this ruling has unfortunately set a dangerous and damaging precedent,” said Krysta Harden, president and CEO of USDEC. “We do however want to express our appreciation for allies in Congress and the Administration for their efforts and commitment to fighting for U.S. dairy. This is unfortunately not the only shortcoming in Canada’s compliance with its international commitments. We are committed to working with USTR and USDA to evaluate efforts to address Canada’s continued harmful actions that depress dairy imports while simultaneously evading USMCA’s dairy export disciplines.”
When first implemented in 2020, USMCA established 14 different TRQs, which allow a predetermined quantity of imports at a specified low tariff rate. The TRQ system that Canada implemented awarded the vast majority of TRQ volumes to Canadian processors and granted very limited access to TRQs to distributors – resulting in limited market access for U.S. exporters. Minor modifications to that system made in 2022 have continued that imbalanced approach.
NMPF’s Doud Discusses Dairy’s Future
Incoming NMPF President & CEO Gregg Doud explains NMPF’s role in Washington policy formulation and dairy farmer priorities, including a new farm bill, Federal Milk Marketing Order modernization, integrity in plant-based labeling and dietary guidelines that maximize the benefits of dairy, in an interview with RFD-TV. He also emphasized the importance of international trade and global issues to U.S. dairy’s future. “We need to look five, 10 years ahead and see what this industry needs,” he said.
Dairy is a staple in spite of inflation
By Allison Wilton, Coordinator, Economic Policy and Global Analysis, NMPF
U.S. dairy consumption has been steadily rising for years, reaching more than 11.5 million metric tons (milk solids equivalent) in 2022. This is up 15% from ten years ago. As one of the highest dairy consuming countries in the world, U.S. per capita consumption of cheese, yogurt, and butter has grown steadily for years. Recent food trends are bringing fun and innovative twists on common dairy products; as examples, butter boards went viral last year as a new “charcuterie” option, and health influencers are raving about the benefits of adding cottage cheese into recipes for higher protein and healthy fats. Ultimately, dairy demand remains resilient even when facing significant headwinds.Dairy’s resiliency is true on a global basis, too. On average, 13% of the global consumer’s protein came from dairy in 2022, a rise compared to 2021 and a significant leap over the past decade. In fact, global dairy protein consumption has grown by nearly 25% over the last decade.
Still, despite that resiliency, inflation and economic uncertainty have affected consumers and the dairy industry.
Inflation had mixed effects
In 2022, consumers started to really take notice of rising grocery and food costs. Prices for goods across all categories, not just dairy, were starting to climb more than usual due to several factors, including the ongoing COVID-19 pandemic and international supply chain disruptions. Inflation reached a peak in summer of 2022, and though it has eased slightly since, prices are still significantly higher compared to three years ago.
Source: NMPF-USDEC, IRI, NPD
Grocery and food items were some of the most prevalent and hardest hit areas by inflation, and dairy products were not immune. The price of dairy in food and beverage stores rose by more than 15% in 2022 compared to 2021, the highest jump in prices of all categories. The value of dairy sales grew significantly in 2022. Even so, and although this can partially be attributed to the higher prices, the growth in dairy sales (up 14.7%) outpaced that of non-dairy categories (8.3% greater).
Additionally, though all categories’ volume fell, the volume of dairy products sold fell less than that of non-dairy products. In other words: even though dairy had higher inflation rates, the slide in volume sold was less than the dip of other food and beverage categories. Shoppers were continuing to put dairy products in their cart despite the higher prices. That’s a testament to the dairy’s place as a dietary staple for many around the country and the world.
Dairy demand persists
Consumers prefer dairy products over plant-based alternatives: sales of cheese, frozen products, and other dairy goods dwarf plant-based imitations in stores. As even more alternatives fill shelves, dairy doesn’t lose shelf space. Rather, per capita consumption in several areas have grown, including cheese (up 17% from 2020), yogurt (up 5%), and butter (up 21%). The dairy aisle remains of top value when compared to other aisles within major food and beverage stores and is one of the fastest growing aisles in terms of sales dollars, topping $75 billion in 2022.
Cheese is expected to grow only more popular as time goes on, as is butter and yogurt. The U.S. dairy industry is poised to meet this demand as the industry advances in the coming years. As inflation wanes, consumers may return to trying higher value dairy products, of which there is no shortage. U.S. dairy will continue to be a major part of consumers’ diets and shopping carts.
This column originally appeared in Hoard’s Dairyman Intel on Nov. 9, 2023.
NMPF Advocacy Helps Boost Market Development Funding
The U.S. Department of Agriculture announced Oct. 23 it will direct $1.3 billion from the Commodity Credit Corporation (CCC) to establish a Regional Trade Promotion Program, and another $1 billion to commodity-based international food aid, after significant lobbying from NMPF and encouragement from the U.S. Dairy Export Council.
The funding announcement was prompted by a Sept. 6 letter from Senate Agriculture Committee Chair Debbie Stabenow, D-MI, and Ranking Member John Boozman, R-AR, calling on the agency to expand CCC authority to fund export promotion and food aid initiatives. NMPF has long advocated for Congress to double funding for the Market Access Program and Foreign Market Development program, which significantly advance U.S. dairy’s reach overseas but have not received a funding boost in more 16 years. This U.S. investment will help bridge the gap in export promotion funding that U.S. agriculture receives in comparison to foreign competitors.
NMPF’S Morris Reviews Achievements of International Dairy Federation Summit
Shawna Morris, NMPF’s executive vice president of trade policy, discusses the recent International Dairy Federation world summit held in Chicago in this audio segment from Dairy Radio Now.
USDEC’s Harden discusses USDA Support for Trade
Krysta Harden, president and CEO of the U.S. Dairy Export Council, discusses the value of USDA support for U.S. agricultural exports in an interview with RFD-TV from the World Food Prize in Des Moines, IA. The department said Oct. 24 it plans to devote $2.3 billion from the Commodity Credit Corporation to promoting better market opportunities for U.S. agricultural producers and expanding food aid to support communities in need around the world, a move advocated for by NMPF and USDEC.
NMPF and USDEC Commend Significant New Investment in Export Market Promotion
The National Milk Producers Federation (NMPF) and U.S. Dairy Export Council (USDEC) praised today’s announcement from the U.S. Department of Agriculture that it plans to devote $2.3 billion from the Commodity Credit Corporation to promoting better market opportunities for U.S. agricultural producers and expanding food aid to support communities in need around the world.
The expanded export support program and food aid were requested by Senate Agriculture Committee Chairwoman Debbie Stabenow, D-MI, and Ranking Member Sen. John Boozman, R-AR, in late August. USDA will devote $1.3 billion to establishing a Regional Agricultural Trade Promotion Program, and $1 billion to commodity-based international food aid.
“The U.S. dairy community is grateful for the USDA’s decision to invest in supporting the cultivation of enhanced international market opportunities for America’s dairy farmers and cooperatives. We thank Senators Stabenow and Boozman for their initiative in encouraging USDA to pursue this course of action,” said NMPF president and CEO Jim Mulhern. “Now more than ever, the U.S. dairy industry relies on exports. If distributed to those sectors that are presently underfunded such as dairy, the new export promotion funding will put us in a better position to compete globally and grow our consumer base. NMPF encourages Congress to build on today’s announcement by USDA to also deliver additional funding for the Market Access Program and Foreign Market Development Program in the development of the next Farm Bill.”
NMPF, USDEC and other agricultural leaders are advocating for Congress to double funding for the Market Access Program and Foreign Market Development program – the two programs have not received a raise in over 16 years, despite offering consistent returns on investment.
“Farmers, manufacturers and workers up and down the dairy supply chain benefit from expanded trade opportunities that help the industry thrive in today’s global economy,” said USDEC president and CEO Krysta Harden. “We’re thankful that USDA is taking this important step to support American Agriculture and appreciate Senators Stabenow and Boozman elevating the importance of using CCC resources to fund programs that will strengthen the U.S. dairy industry through the creation of new markets and the promotion of nutritional dairy-containing products in food aid. We look forward to continuing to work together to level the playing field for America’s dairy farmers and producers.”
NMPF Engages on New Federal Supply Chain Program
NMPF and USDEC coordinated a Sept. 8 U.S. Department of Transportation briefing on its Freight Logistics Optimization Works (FLOW) program to a group of members that have been engaged in the organizations’ supply chain working group.
A novel approach to optimizing supply chain data, FLOW allows U.S. stakeholders including ocean carriers, ports, motor carriers, railroads, warehousers and others to exchange data and better measure cargo traffic demand versus equipment supply. FLOW incorporates elements of the now-defunct USDA Ocean Shipping Container Availability Report, which NMPF and USDEC have long advocated for resuming. The two organizations are also pressing the U.S. government for increased transparency into the export supply chain, including through expanding dairy exporter participation in FLOW.
September CWT-Assisted Dairy Export Sales Nearly 10.4 Million Pounds
Cooperatives Working Together (CWT) member cooperatives secured 30 contracts in September, adding 2.4 million pounds of American-type cheeses, 99,000 pounds of butter, 719,000 pounds of cream cheese and 7.1 million pounds of whole milk powder to CWT-assisted sales in 2023. In milk equivalent, this is equal to 82.2 million pounds of milk on a milkfat basis. These products will go to customers in Asia, Central America, the Caribbean, South America and Middle East-North Africa, and will be shipped from September 2023 through March 2024.
CWT-assisted 2023 dairy product sales contracts year-to-date total 36.3 million pounds of American-type cheese, 908,000 pounds of butter, 26,000 pounds of anhydrous milkfat, 6.9 million pounds of cream cheese and 38.6 million pounds of whole milk powder. This brings the total milk equivalent for the year to 692.6 million pounds on a milkfat basis.
Exporting dairy products is critical to the viability of dairy farmers and their cooperatives across the country. Whether or not a cooperative is actively engaged in exporting cheese, butter, anhydrous milkfat, cream cheese, or whole milk powder, moving products into world markets is essential. CWT provides a means to move domestic dairy products to overseas markets by helping to overcome U.S. dairy’s trade disadvantages.
The amounts of dairy products and related milk volumes reflect current contracts for delivery, not completed export volumes. CWT will pay export assistance to the bidders only when export and delivery of the product is verified by the submission of the required documentation.
