Outline. Global Milk Production. Global Cow s Milk Production. Global Situation. Selected Countries

Transcription

1 Outline Key Factors Impacting the U.S. and Global Dairy Sectors in 21 Mary Keough Ledman. Libertyville, Illinois November 5, 9 Global Milk Production Overview of U.S. and Regional Milk Production Overview of the Key Demand Factors Dairy Product and Milk Price Forecasts Policy Initiatives Global Milk Production Global Situation (1, MT) 16, 14, 12, 1, 8, 6, 4, 2, Global Milk Cow Production Key Countries 4 vs. 9 (f) 4 9 f Global Cow s Milk Production Global Milk Production Selected Countries The EU 25 accounts for 31% of total 166. world production, down from 33% in The U.S. accounts for 2% of total world production, up from 19% in China s s market share has increased % from 6% in 4 to 9% in Million Metric Tons (f)

2 Global Cow s Milk Production Milk producers around the world responded to high milk prices in the 2 nd half of 7 which contributed to the collapse in dairy product prices during the 2 nd half of 8 and into 9. Now, in the 2 nd half of 9 growth in milk production is lackluster Global Cow s Milk Production No substantial increase in EU milk production is expected despite higher quotas. U.S. milk production expected to be down by almost 1% in Q4 9 vs. prior year. U.S. milk production expected to be lower than prior year in 1 st half of 21 but higher in 2 nd half of 21. Global Cow s Milk Production Australia year-to to-date, production down 4% but September is down 8% vs. last year. New Zealand production was trending 2% to 3% higher early in the production season, now is trending lower than the prior year due to poor weather conditions. Global Milk Production Outlook Limited growth in 9 and into 21 IF there is a significant spike in prices, the U.S. will respond due to ample bred heifers (impacted by sexed semen) and ample feed stocks. Global Cheese Production Global Cheese Exports (1, Metric Tons) 8, 7, 6, 5, 4, 3, 2, 1, Global Cheese Production, Key Countries 4 vs. 9 (f) 4 9F (1, Metric Tons) Cheese Exports, Key Countries 4 vs. 9 (f) Argentina Australia EU-27 New Zealand 4 9 (f) Ukraine U.S.

3 (1, Metric Tons) Global Cheese Imports Cheese Imports, Key Countries 2 vs. 9 (f) Global Cheese Production and Trade in 9 The EU-27 accounts for 48% of the global cheese production and 38% of the global cheese exports. New Zealand accounts for 2% of the global cheese production and 21% of the global cheese exports The US accounts for 32% of the global cheese production and 8% of the global cheese exports 4 9 (f) Global Cheese Trade Production dominated by EU-27 and the U.S. Exports dominated by the EU-27 and Oceania However, greater percentage growth in exports from U.S. and Argentina 9 vs. 4 Imports dominated by Russia, Japan and U.S. Growth in Mexico s s cheese imports are important to U.S. exporters (1, Metric Tons) 1, 1, Global SMP Production Global SMP Production, Key Countries 2 vs. 9 (f) 4 9 (f) SMP Exports SMP Imports (1, Metric Tons) SMP Exports, Key Countries 2 vs. 9 (f) (1, Metric Tons) SMP Imports, Key Countries 4 vs. 9 (f) 4 9 (f) 4 9 (f)

4 Global SMP Production and Trade NFDM Production and Exports Global NFDM/SMP production increased from 3.2 million metric tons in 4 to 3.5 million metric tons in 9 Significant gains from U.S. and India Global exports during this time decreased by 166, metric tons from 1.16 million metric tons in 4 to 996, metric tons in 9 (Mil. Lbs.) Comparison of NFDM/SMP Production and Exports NFDM Exports NFDM Prod Value and Quantity of U.S. Dairy Exports U.S. $ vs. Euro $4,5 Value and Quantity of U.S. Dairy Exports 3, $1.2 $1.1 (Million $) $4, $3,5 $3, $2,5 $2, $1,5 2,5 2, 1,5 1, (Million Lbs.) $1. $.9 $.8 $.7 $1, $5 $ Value Quantity 5 - $.6 $ Source: European Central Bank U.S. Export Outlook 21 U.S. Dairy Product Exports are expected to be higher than 9 U.S. milk producers are in a position to respond to higher prices and potential export opportunities The weak dollar is expect to support dairy product exports, as well as potentially curb dairy product imports. U.S. Milk Production

5 U.S. Milk Production YTD U.S. Milk Production (Million Lbs.) 17, 16, 15, U.S. Milk Production Chg. vs. Aug. '9-1.4% Chg. vs. Sep. '8 -.7% YTD Avg +.2% (Million Lbs.) 15,5 15, 14,5 14, Milk Production (23 selected states) Chg. vs. Aug. '9-1.4% Chg. vs. Sep. '8 -.7% YTD Avg.2% 14, J F M A M J J A S O N D 13,5 J F M A M J J A S O N D 9 9E 21 E U.S. Milk Production Per Cow U.S. Cow Numbers (lbs.) 1,8 1,7 Milk Production Per Cow (23 selected states, 3-day months) Chg. vs. Aug. '9-1.2% Chg. vs. Sep. '8 +1.6% YTD Avg +.8% (thousand) 8,6 8,5 8,4 Milk Cows (23 selected states) Chg. vs. Aug. '9 -.4% Chg. vs. Sep. '8-2.% YTD Avg -.4% 1,6 J F M A M J J A S O N D 8,3 J F M A M J J A S O N D E 21E Western Region Regional Supply 5,1 4,9 4,7 Western Region Monthly Milk Production Chg. vs. Aug. '9-1.9% Chg. vs. Sep. '8-5.% 9 vs % 4,5

6 Southwest Region Northeast Region 1,9 1,8 1,7 1,6 1,5 Southwestern Region Monthly Milk Production Chg. vs. Aug. '9 +.3% Chg. vs. Sep. '8 -.2% 9 vs % 2,3 2, 2,1 2, Northeastern Region Monthly Milk Production Chg. vs. Aug. '9-1.5% Chg. vs. Sep. '8 -.5% 9 vs % 1,4 1,9 Midwest Region Dairy Cow Slaughter 3,6 3,4 3, Midwestern Region Monthly Milk Production Chg. vs. Aug. '9-1.4% Chg. vs. Sep. '8 +4.6% 9 vs % (1, head) Federal Inspected Dairy Cow Slaughter (3-day months) 3 Chg. vs. Aug. '9 +2.% Chg. vs. Sep. '8 +5.6% 25 9 YTD +12.5% 15 ` Regional Slaughter Milk-feed Price Ratio Ratio Milk-Feed Price Ratio y -5 y -6 y

7 Milk Feed Price Ratio Pounds of 16% Mixed Dairy Feed equal in value to 1 pound of Whole Milk 16% Mixed Dairy Feed includes: Corn Soybeans Alfalfa Ratio above 3. drives expansions Milk Feed Price Ratio. Est. Milk Feed Price Ratio All Milk Price Corn Soybeans $13.8/cwt. $3.54/bu. $9.74/bu. +$.9/cwt. +$.29/bu. -$.1/bu. Alfalfa $19/ton -$1./ton USDA All Milk Price Demand Factors $/cwt USDA's All Milk Price Commercial Disappearance Consumer Price Index Exports Source: USDA, May 11, F 21 F Source: USDA ober 16, 9 Commercial Disappearance CPI All Fluid Milk uary through y 9 -.6% vs. Prior Year Butter -3.7% American Cheese +4.3% Other Cheese +1.4% NFDM -7.5% Fluid Milk +1.4% = CPI -- All Fluid Milk

8 CPI Butter CPI Cheese CPI -- Butter 225 CPI -- Cheese = = uary August 9 Exports Dairy Product Exports, Production and Stocks Million Lbs. % vs. 8 % of Production NFDM/SMP % 27% Butter/Milkfat % 2.2% Total Cheese % 2.% Cheddar %.8% Cheese Dry Whey % 42% WPC % 49% Lactose > 99% % 38% Lactose < 99% %. Copyright 9 46 U.S. Butter Production Total Butter Stocks U.S. Butter Production (3-day months) Chg. vs. Aug. '9-3.1% Chg. vs. Sep. '8-21.9% 9 YTD -2.8% Total Butter Stocks Chg. vs. Aug. '9-11.3% Chg. vs. Sep. '8 +7.7%

9 Butter Exports American Cheese Production U.S. Butter and Milkfat Exports U.S. American Cheese Production (3-day months) (million Lbs.) vs. 8 YTD -83% Chg. vs. Aug. '9 +2.2% Chg. vs. Sep. '8 +6.4% 9 YTD +4.1% American Cheese Stocks Cheddar Cheese Exports Total American Cheese Stocks U.S. Cheddar Cheese Exports Chg. vs. Aug. '9-2.% Chg. vs. Sep. '8 +1.5% (million Lbs.) vs. 8 YTD -6% 45 - Mozzarella Production NFDM/SMP Production U.S. Mozzarella Cheese Production (3-day months) Chg. vs. Aug. '9 +2.6% Chg. vs. Sep. '8 +4.4% 9 YTD +.5% U.S. Nonfat Dry Milk and Skim Milk Powder Production (3-day months) Chg. vs. Aug. '9-11.5% Chg. vs. Sep. '8-19.9% 9 YTD -6.%

10 NFDM Stocks NFDM/SMP Exports Manufacturers Stocks of NFDM U.S. NFDM/SMP Exports Chg. vs. Aug. '9-27.% Chg. vs. Sep. '8-34.7% (million Lbs.) vs. 8 YTD -45% Forecast Summary Milk and Dairy Product Prices and Forecasts Western NFDM WPC Mostly Central Dry Whey CME AA Butter CME 4 lb. Block Cheese E 21 E 8 avg. $ $ $1.411 $ $.7954 $.7494 $.5937 $.2336 $.2784 $ $ $ $ $ $ Forecast Summary Class I Mover E 21 E 8 avg. $18.14 $18. $13.96 Class II $18.36 $16.24 $13.68 Class III $18.4 $17.44 $13.5 Class IV $19.5 $14.65 $12.95