Dry whey sales are important to dairy farm prices in the US

Published Jul 31, 2024

Tridge summary

China is a crucial market for the sale of dry whey from the U.S., a factor that significantly influences farmer profitability, with a small change in dry whey price leading to a substantial shift in Class III milk price. Despite China's increase in milk production, it has not yet expanded into cheese production, which could potentially impact U.S. whey exports. Compared to New Zealand, the U.S. has been less affected by the changes in China's import needs. New Zealand has had to shift its milk powder production to target new markets, such as Mexico, following a decrease in milk powder purchases by China, which now accounts for about 6% of New Zealand's production.

Disclaimer:The above summary was generated by Tridge's proprietary AI model for informational purposes.

Original content

An economist says the one dairy product China continues to regularly import from the U.S. is very important to farmer profitability. Mary Ledman with RaboResearch tells Brownfield China remains important for the sale of dry whey, which helps support dairy prices. “Every penny change on the dry whey price changes the Class III milk price by six cents, so a ten cent change on dry whey is a sixty cent change on the Class III milk price.” Ledman says China has added a lot of milk production in the past five years but, “They have not expanded into cheese production, and to do so, they would have to do it on a much larger scale to really impact our whey exports to China.” Ledman says on the world dairy market, the U.S. has been less impacted by the changes in China’s import needs than some other countries like New Zealand. “Our exposure to this has been less directly than it has been for New Zealand, so for New Zealand, this has been a real game changer because for number one, New ...

Source: Brownfield Ag