September 2023 U.S. agricultural export numbers were mixed to mostly lower as the ag trade deficit continues to deepen. Here’s Progressive Dairy’s 30,000-foot look at dairy-related categories.
Dairy export trends continue
Despite record shipments of whey protein concentrate and a rebound in U.S. cheese exports, year-over-year U.S. dairy exports (milk solids equivalent or MSE) fell 12% in September. It was the eighth consecutive decline, dating back to February. September export value fell 25% to $603 million, the lowest monthly total since January 2022, according to a monthly market update from the U.S. Dairy Export Council (USDEC).
Trends that have been keeping overall U.S. dairy exports in check for most of the year remain largely unchanged. U.S. suppliers continue to face strong demand headwinds from tepid global economic growth, elevated inflation and, in the case of low-protein whey, China’s struggling pork sector.
With September’s numbers, the Department of Commerce/Bureau of the Census estimated fiscal year 2023 (October 2022-September 2023) dairy product exports at about $8.5 billion, down 7% from fiscal year 2022. Fiscal year 2023 dairy imports were estimated at $5.5 billion, up 13%, with cheese imports up 10% at $1.69 billion.
CWT-assisted exports
The National Milk Producers Federation (NMPF) said October 2023 Cooperatives Working Together (CWT) program-assisted export contracts covered 5.4 million pounds of American-type cheeses, 884,000 pounds of cream cheese and 388,000 pounds of whole milk powder. The contracts, for delivery between October 2023 and April 2024, covered almost 59 million pounds of milk on a milkfat basis.
Year-to-date CWT export sales total 41.7 million pounds of American-type cheeses, 908,000 pounds of butter, 39 million pounds of whole milk powder, 7.8 million pounds of cream cheese and 26,000 pounds of anhydrous milkfat. This brings the total milk equivalent for the year to 751.6 million pounds on a milkfat basis.
The amounts of dairy products and related milk volumes reflect current contracts for delivery, not completed export volumes. CWT pays export assistance to the bidders only when the export and delivery of the product are verified by the required documentation.
Dairy heifer sales down
The USDA’s Foreign Agricultural Service (FAS) estimated export sales of U.S. dairy replacement heifers fell to a 15-month low in September. Sales totaled 185 head, all staying close to home: 105 moved to Canada and 80 went to Mexico. January-September exports now total 10,713, still 3,646 more than the same period a year ago.
Besides live dairy replacements, exports of dairy embryos were estimated at 604 in September, bringing the year-to-date total to 8,380. China is the leading market for the year with 3,864.
Hay exports higher
September exports of alfalfa hay were estimated at 218,532 metric tons (MT), a 10-month high. Export volume to China was the highest since February. However, January-September sales are still the smallest for that period since 2015.
September exports of other hay hit a 16-month high at 98,912 MT. The increase was primarily supported by higher sales to Japan and the United Arab Emirates. Year-to-date sales total 713,315 MT, the smallest total to start a year in at least two decades.
Negative ag trade balance grows
September’s U.S. ag trade balance extended and increased the deficit started in March to record depths.
The U.S. Department of Commerce/Census Bureau estimated the value of September agricultural exports at $12.73 billion and the value of ag imports at $15.34 billion, yielding a trade balance of -$2.6 billion for the month.
The fiscal year 2023 agricultural trade deficit was about $16.6 billion, and is approaching $20 billion for calendar year 2023.
