U.S. Dairy Exports Hit All-Time Record in March

USAgNet - 05/07/2021

There was plenty of positive news for U.S. dairy in March's export data. First, the U.S. exported 215,557 metric tons (MT) of dairy products in milk solids equivalent -- a new record. Second, that volume equated to an estimated 18.6% of production exported for the month of March -- the second highest month of all-time. Third, value grew right alongside volume with $688 million worth of dairy products shipped overseas in March -- the highest since 2014.

Ultimately, there was not just one cause behind the record month in U.S. dairy exports -- U.S. dairy had robust growth in all major product categories. Non-fat dry milk/skim milk powder (NFDM/SMP) and whey both had all-time highs with exports of 86,532 MT and 57,181 MT, respectively. Cheese was no laggard either -- posting its second-best month of all time (36,919 MT). Butterfat and lactose also posted strong gains.

March's export data was so strong that it had us triple- and quadruple-checking our numbers to be sure we hadn't missed a decimal point. After confirming that the numbers were correct, here are our key takeaways:

One of the big questions heading into 2021 was whether Mexico could bounce back from dual setbacks of recession and pandemic that depressed dairy demand and imports throughout most of 2020. We previously flagged signs of optimism in the ongoing reopening of the nation's tourist sector, increased vaccinations and the coattail effects of the surging U.S. economy.

March U.S. dairy exports to Mexico (on top of some positive signals in February) have heightened that optimism.

Year-over-year NFDM/SMP exports to Mexico grew 29% (+5,943 MT) to 26,760 MT in March (vs. the previous year). It was the second straight year-over-year increase.

While still trailing pre-recession, pre-pandemic volumes from 2018 and 2019, U.S. NFDM/SMP shipments were up 16% in the first quarter compared to 2020. It is a very positive sign after the 13% decline to, historically, our largest milk powder market in 2020.

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