Milk solids basis: January-June exports totaled 1.2 billion pounds on a milk solids equivalent basis, up 2% from the same period in 2021.
Driving success
USDEC cites multiple factors in driving cheese and whey exports:

First, despite limited milk production growth in the U.S., cheese production has managed to expand.

Second, U.S. cheese has been relatively affordable on the global market, both on a spot basis and in futures markets for the majority of the first half of the year.

Pricing factors have also favored U.S. cheese suppliers in key buying regions like Mexico and Central America, where cheese prices are more competitive with cheaper alternatives using palm oil instead of dairy fats. Demand in Latin America is further aided by a strengthening peso, raising purchasing power for imports while local milk production remains weak.

Finally, the rebound in Chinese pig prices that began in mid-April and peaked in July likely also supported June whey export volume.

What’s ahead?

Along with the factors mentioned above, the USDEC report said the recovery in U.S. shipping is helping lift overall U.S. export volumes. Mitigation measures, including creation of pop-up container facilities, threats to implement dwell time fees to ocean carriers and the implications of the Ocean Shipping Reform Act, are beginning to make a difference as delayed product secures passage aboard ocean vessels.

After declining for most of the final three-quarters of 2021, the number of loaded outbound 20-foot equivalent shipping units (TEUs) leaving major California ports has been slowly ticking upward this year.

While the West Coast dockworkers contract remains a big shipping unknown, the improvement in container flow bodes well for U.S. dairy export efforts heading into the back half of 2022 – particularly as more attention is paid to correcting additional supply chain choke points.

Economic growth and inflation (from dairy input costs to retail prices) will continue to create export headwinds, but the supply chain arguably is looking up for the first time since before the pandemic, according to USDEC.

For more, read: U.S. dairy exports soar in June, climbing 9%.