Tag: dairy industry
Record Exports Drive U.S. Dairy Demand
By William Loux, Vice President, Global Economic Affairs, NMPF and U.S. Dairy Export Council.
U.S. dairy exports excelled again in 2022, with record shipments further cementing its role as the key demand driver for U.S. milk.
For the third consecutive year, the U.S. dairy industry set a record for the volume of dairy products exported on a milk solids equivalent basis, with the current record now surpassing 2.4 million metric tons — the equivalent of over 40 billion pounds of raw milk, or 18% of the U.S. milk supply.
Perhaps even more impressive, for the fifth time in the last six years, U.S. exports grew by more than domestic consumption. Of that six-year window, 2019 was the only time in that span when exports grew by less than domestic sales. That’s the year the U.S. faced prohibitive retaliatory tariffs on dairy products destined for China. In addition, African Swine Fever was cratering China’s demand for whey products. At the same time, U.S. skim milk powder exporters were facing headwinds from EU intervention storage stocks that began hitting the market at below-market prices in 2019. All this noted, with 2019 being a particularly unique exception, the international market has been the driver of U.S. dairy demand growth for the past six years.
Success can’t be taken for granted
European milk production came on strong at the tail end of 2022 as favorable weather and margins boosted output. Conversely, demand within the European Union bloc has reportedly weakened as consumers feel the squeeze on their wallets, which is causing European wholesale prices to dip. With more supply, weaker internal demand, and low prices, we can expect significantly more competition from Europe in the international market than we did in 2022 when their exports dropped 10% during the first 11 months of the year.
Additionally, the international demand picture remains uncertain. Despite the clear success of U.S. dairy, the world’s collective dairy trade actually dropped 4% in 2022 — primarily on account of China. The world’s largest dairy product-importing nation contracted dairy imports by 21% as the country drew down inventories built in 2021, witnessed a surge in domestic milk supplies, and instituted movement restrictions, all of which damaged dairy consumption and imports.
China’s return to the market in 2023 remains uncertain. The lockdowns have been lifted, but milk production in the country is still growing, and inventories of milk powder reportedly remain heavy. Optimistically, consumption in the country will rebound and stockpiles will be reduced, setting the stage for China’s return as a global buyer in the middle part of the year. But until they do, New Zealand, which exported over 40% of its production to China at its peak, will have plenty of products available for customers elsewhere, meaning increased competition with the United States.
Outside of China, the demand picture will likely be mixed depending on local conditions, but broadly, slower economic growth and inflation are expected to challenge lower-income consumers and push buyers to look for bargains.
Overall, I am forecasting international demand in 2023 to return to growth, but not at a spectacular rate, and with more suppliers competing for business.
Given the expected headwinds this year, industry investment in international markets will be critical to success. To set another record in 2023, the U.S. must continue the work being done to build demand for U.S. dairy products overseas and expand market access in key markets, all while maintaining reliability with international customers by being engaged and responsive.
This column originally appeared in Hoard’s Dairyman Intel on Feb. 21, 2023.
Rising Domestic Use Supports Prices
NMPF’s Bjerga on Dairy’s Recent Policy Wins
As the year comes to a close, the National Milk Producers Federation is applauding two recent measures that support the dairy industry. NMPF Senior Vice President of Communications Alan Bjerga spoke with RFD-TV’s own Janet Adkison about how the Growing Climate Solutions Act and Sustains Act benefit dairy farmers, and what USTR’s announcement of a new request for dispute settlement consultations with Canada means for U.S. dairy.
https://www.rfdtv.com/two-recent-measures-from-congress-and-ustr-are-giving-a-boost-to-dairy-farmers
Scholarships give back to dairy, NMPF’s Ayache says
The National Dairy Leadership Scholarship Program supports dairy research — and the industry as a whole — by assisting students who do cutting-edge scholarship, and then stay within the sector, said Nicole Ayache, National Milk Producers Federation Vice President, Environmental Stewardship and Sustainability, in an interview with the National Association of Farm Broadcasters. “We’re really trying to support those individuals and their career. We want them to stay within dairy and contribute to our community,” she said. More information on the scholarships and how to donate to them is here.
NMPF Lauds Bipartisan Ag Climate Measures in Appropriations Package
The National Milk Producers Federation (NMPF) today commended Congress for including the Growing Climate Solutions Act and the SUSTAINS Act in its final fiscal year 2023 budget package. These measures will help dairy farmers seek additional sustainability opportunities as they work to fulfill the dairy sector’s voluntary, producer-led goal of becoming greenhouse gas neutral or better by 2050.
“Environmental markets and conservation programs have the potential to meaningfully assist dairy producers as they work to meet their 2050 environmental stewardship goals,” said NMPF president and CEO Jim Mulhern. “The Growing Climate Solutions Act and the SUSTAINS Act will strengthen these important tools.”
The Growing Climate Solutions Act, authored by Senate Agriculture Committee Chairwoman Debbie Stabenow, D-MI, and Senator Mike Braun, R-IN, passed the Senate last June on a bipartisan vote of 92-8. The legislation would enable USDA to register technical service providers that help farmers implement stewardship practices that can generate credits on environmental markets. In turn, producers will be better positioned to participate in these important markets. Reps. Abigail Spanberger, D-VA, and Don Bacon, R-NE, have introduced companion legislation in the House.
The SUSTAINS Act, authored by House Agriculture Committee Chairman-elect Glenn ‘GT’ Thompson, R-PA, passed the House Agriculture Committee in May on a bipartisan voice vote. The measure would allow private sector funds to supplement existing funding for farm bill conservation programs, which are continuously oversubscribed. The bill is an innovative approach to boosting funding for USDA conservation programs, which provide important technical assistance to dairy farmers for a variety of stewardship practices.
In addition to the sponsors of both bills, committee leaders Rep. David Scott, D-GA, and Sen. John Boozman, R-AR, also played important roles in finalizing the bipartisan package.
“We commend the leaders of the Agriculture Committees – Senators Debbie Stabenow and John Boozman and Reps. David Scott and GT Thompson – for working together to fashion this bipartisan agreement on agricultural climate legislation,” Mulhern said. “We look forward to working with them and their colleagues to build on this progress in the new year.”
NMPF Calls on Lawmakers to Support Domestic Infant Formula Production
In a letter to lawmakers, the National Milk Producers Federation urged support for domestic infant formula production as the production shortfalls that stripped store shelves of necessary infant formula have eased. Given the improving situation, tariff waivers that could discourage the production of a safe, secure domestic infant formula supply should be allowed to expire at end of this year as scheduled, NMPF said in the letter to the chairmen and ranking members of the Senate Finance Committee and House Ways and Means Committee.
“Given that the temporary production shortfall that gripped American families in need of formula earlier this year has abated, we urge Congress to ensure that the unique, unilateral tariff benefits granted to our trading partners under the Formula Act and the Bulk Infant Formula to Retail Shelves Act end as scheduled at the close of this year,” said NMPF Chairman and CEO Jim Mulhern in the letter, dated Nov. 17 . “We respectfully request your opposition to any effort to extend these preferential tariff benefits beyond the end of this year.”
A strong, diversely sourced domestic infant formula production industry ensures the highest quality, safest products while supporting rural jobs and domestic producers.
NMPF, IDFA Seek to Fix WIC Proposal that Would Decrease Access to Dairy’s Nutrients
ARLINGTON, Va. and WASHINGTON, DC – Representing dairy farmers, cooperatives, and processors, the National Milk Producers Federation (NMPF) and the International Dairy Foods Association (IDFA) issued the following joint statement in response to USDA’s proposed changes to the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) released today:
“It is unfortunate for WIC participants that the proposed rule would decrease access to dairy products and the unique nutrient profile they provide, especially considering the current Dietary Guidelines for Americans (DGA) note that a staggering nearly 90 percent of the U.S. population does not consume enough dairy to meet dietary recommendations. At a time of rising food costs and high food insecurity, we should focus on increasing access to a wide variety of healthful, nutrient-dense, and affordable foods, including both fresh produce and dairy products. It’s disappointing that the proposed rule would limit WIC family purchasing power for nutritious dairy foods, particularly at a time like this.
“WIC is central to helping ensure pregnant women, new mothers, infants, and children have access to the nutrients needed for growth and development at the critical life stages surrounding pregnancy, birth, and early childhood. The vast body of nutrition science demonstrates that nutritious dairy products like milk, yogurt, cheese, and cottage cheese are especially important in the diets of women, infants, and children. Dairy is a source of 13 nutrients, including three of the four nutrients of public health concern as noted by the DGA, which is why dairy has always played a significant role in the WIC program.
“NMPF and IDFA commend USDA for suggesting approaches to make the nutrient-dense food provided by the WIC program more accessible, including expanded options for yogurt and cheese varieties and for proposing WIC participants be able to purchase these dairy products in a wider variety of product package sizes that are more commonly found in grocery stores. We also applaud USDA for its continued commitment to nutritional equivalency in substitute products, rejecting those that do not provide an equivalent nutrition package, as recommended by the DGA.
“We look forward to working with USDA to modernize the WIC food package for eligible families to access nutrient-dense milk, yogurt, and cheese varieties that are a part of their everyday diets and accessible in neighborhood stores, thus fulfilling the program’s nutritional objectives. IDFA, NMPF, and our members will advocate against reducing the amount of nutritious dairy foods provided through WIC in USDA’s final rule because we are committed to reducing food insecurity, malnutrition, and diet-related disease while improving health outcomes by making it easier for all Americans to access healthy, affordable foods, including nutritious dairy products. We hope USDA will work to achieve these same objectives as they develop a final WIC rule, which, given dairy’s unique nutrient package and incomparable role in nourishing WIC participants, will require USDA not to decrease access to dairy in the WIC program.”
Live, from the Dairy Bar, it’s NMPF!
NMPF Senior Vice President of Communications Alan Bjerga gives an impromptu tour of the Dairy Bar and the Joint Annual Meeting in Denver. From delicious products to critical information, the Dairy Bar has it all — and the meeting itself resulted in gains for dairy producers, as detailed in this interview with RFD-TV.
NMPF’s Larson on White House Nutrition Conference
The U.S. dairy industry has a long-standing commitment to the nutrition and health of the nation. Ensuring that people have consistent and equitable access to the nutrition they need is a key priority for the National Milk Producers Federation, just like the recent White House Conference on Hunger, Nutrition and Health.
Claudia Larson, NMPF senior director of government relations, tells the National Association of Farm Broadcasters that most people know that dairy is nutritious, but not everybody knows the details of dairy’s potential in fighting nutrition insecurity.
Dairy is Retro-Hot With Demand That’s Back to the ’50s
Note: This article first appeared in Hoard’s Dairyman Intel.
By Alan Bjerga
Senior Vice President, Communications, NMPF
With this year’s USDA report on per-capita U.S. dairy consumption, the industry has finally moved past the 1960s. In terms of favor with the American public, dairy has returned to 1959.
Sound strange?
It’s true.
The USDA’s annual report on per-capita U.S. dairy consumption released Friday, September 30, saw an emphatic rise in domestic dairy demand, going from 655 pounds per person in 2020 to 667 pounds per person last year. That’s a level of dairy popularity that surpasses 1960, when it was 659 pounds, and is approaching 1959’s consumer appeal of 672 pounds.
In other words, the last time Americans wanted as much dairy as they do today, Elvis was in the Army. And keep in mind, the 1959 population of the United States. then was only slightly more than half of what it is now. And exports, which now take up nearly 20% of domestic production, barely existed back in those days.
So, what does this say about the industry?
What it doesn’t say is that Americans are consuming dairy the same way now as they did then. Fluid milk has continued its slow decline, according to the USDA data. But cheese continues to rise – American-style cheese consumption reached another record last year. And butter – well, butter actually is returning to Eisenhower-era levels, so in that case, a “Back to the Future” comparison may be appropriate.
But even as the dairy product consumption mix shifts over time, the overall positive trajectory – the 2021 gain is the seventh in the past eight years – is clear, and impressive. Despite more and more competition from nondairy competitors . . . despite an increasingly demanding consumer . . . and despite disruptions that range from diet fads to pandemics . . . consumers continue to find dairy increasingly useful, preferable, and important. That’s a tribute to the hard work of dairy farmers and the entire industry. And it’s worth celebrating.
So put on your turntable some Buddy Holly, some Johnny Cash, maybe some Little Richard, or whatever else suits your taste as dairy celebrates. Maybe serve some cheese, some yogurt, or if you’re feeling really old-school, some whole milk – a bright spot in the fluid segment. Just stay away from playing any Chubby Checker. “The Twist” was a hit in 1960. And as dairy breaks historical barriers to reach ever-higher levels of popularity, that’s so last year.
NMPF’s Bjerga on Butter and Cheese
NMPF Senior Vice President of Communications Alan Bjerga discusses the steady rise of butter and cheese consumption over the past decade on RFD-TV. With per-capita U.S. dairy consumption hovering at six-decade highs, butter and cheese have been key drivers of dairy demand. But watch out for sour cream and yogurt when new USDA data comes out Friday, he said.
