August’s slight rise in U.S. dairy export volume positions year-to-date export volume growth at 0.1%, the first time in all of 2024 where volumes have surpassed the no-growth threshold. Here’s Progressive Dairy’s 30,000-foot look at dairy-related export categories.
Cheese demand bolsters August’s export volumes
August’s U.S. dairy export volume was up slightly compared to a year ago (1.7%), exemplifying the year’s yo-yoing trend with now four months of increased year-over-year milk solid equivalent (MSE) and four months of decreased year-over-year MSE, as explained in the U.S. Dairy Export Council’s monthly market update. The month’s growth does put year-to-date export volume in the positive for the first time this year (0.1%).
The real story for August is year-over-year U.S. dairy export value increasing 10% to $708 million, with cheese and proteins as the main characters. The month’s vast progress is the biggest climb in 2024.
All year, cheese has been the shining star with global demand surging with little signs of slowing down. The U.S. has capitalized on this trend with cumulative shipments of cheese up 21% from January through August. In August alone, the U.S. moved 42,459 metric tons of product abroad (15% more volume than the same month last year). Mexico remains the leader of cheese purchases as exports across the southern border rose 17%, but other destinations recorded notable purchase volumes. Middle East and North Africa purchased 136% more U.S. cheese in August with an appetite for shredded product. Demand from Southeast Asia – specifically the Philippines – as well as South America, Central America and the Caribbean also boosted exports by 93%, 43% and 13%, respectively.
Whey export growth was steady in August with year-over-year low-protein whey shipments rising 5%, up 2,072 metric tons. As the largest customer, China eased purchases in August (volume falling 12% for the month), and other destinations helped seal the deal with volume up to Southeast Asia (1,589 metric tons) South America (1,450 metric tons), and the Middle East North and Africa (1,250 metric tons).
China did support whey protein concentrate 80 (wpc80+) exports to the product’s second-highest monthly total at 7,944 metric tons. Purchases from the country were up 2,521 metric tons in August, offsetting sharp declines in other top U.S. markets Japan and Brazil, down 30% and 18%, respectively.
CWT accepts 161 offers in quarter three
In the Cooperatives Working Together (CWT) quarterly report, member cooperatives accepted 161 offers for export assistance during the third quarter of 2024. In total, that assistance captured sales for 13.6 million pounds of American-type cheese, 220,000 pounds of butter, 95,000 pounds of anhydrous milkfat, 730,000 pounds of whole milk powder and 2.4 million pounds of cream cheese. The products are going to customers in Asia, Central America, the Caribbean, Middle East and North Africa, Oceania and South America through March 2025.
Year-to-date export sales are the equivalent of 786 million pounds of milk on a milkfat basis and going to 28 countries in five regions.
The amount of dairy products and related milk volumes reflect current contracts for delivery, not completed export volumes. CWT pays export assistance to bidders only when export and delivery of the product is verified by required documentation.
Replacements lag, embryos surpass July volumes
August’s exports for herd growth were a bit of a mixed bag, with dairy heifer replacement exports down 22% from the month prior and dairy embryo exports up 18% during the same time frame.
Purchases of U.S. dairy heifer replacements only came from Canada in August for a total of 206 animal units exported to our neighbors to the north. For Canada, these imports represented 24% more than a month ago.
Year-to-date replacement sales are at 1,034 animal units.
The export of dairy embryos in August was the opposite of replacement heifers, with volume up 18% month over month. Leading those purchases was France, importing 123 in August, up from four embryos in July. South Korea also helped bolster embryo exports, purchasing 99 units and the country’s first transaction in 2024.
China posted the largest decrease in month-over-month imports of U.S. dairy embryos. The country only purchased 96 units in August, down from 303 in July (a decrease of 68%).
Embryo sales year to date are at 4,108.
Hay exports slow down in August
Dairy-quality alfalfa hay exports were down 5% in August from July. China was still the largest purchaser but also decreased U.S. dairy-quality alfalfa hay imports by 32%. The second-largest purchaser was Saudi Arabia, up 34% from a month prior.
In total, August’s dairy-quality hay exports were 157,353 metric tons, adding to a year-to-date total of 1,490,265 metric tons.
Japan and South Korea led the charge of U.S. other hay purchases at 48,852 metric tons and 23,529 metric tons, respectively. The month’s total was 89,760, up 13%, and contributing to a year-to-date total of 710,945 metric tons for 2024.
Trade balance mirrors previous month
August’s U.S. agricultural trade balance shrunk just ever so slightly from July. The Department of Commerce/Census Bureau estimated August exports at $13.008 billion and imports at $17.190 billion for a trade balance deficit of $4.183 billion.
The fiscal year-to-date (Oct. 1, 2023, to August 2024) balance is a deficit of $27.521 billion.
