The weakness in global dairy commodity prices is set to puncture the recent gains the US has enjoyed in dairy exports, agribusiness analysts Rabobank said today (24 September).
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US dairy exports almost doubled between 2005 and 2008 but this year’s relatively low dairy prices crisis will likely see shipments decline once again this year, Rabobank’s Mark Voorbergen said.
According to the Rabobank World Dairy Map, which was released today, the US emerged as the third-largest dairy exporter in 2008, behind the EU and New Zealand. The country was able to increase its volume share to 13% of global trade, up from just 8% in 2005.
“In the year we are reporting on – 2008 – they were essentially the only country in the world that was able to increase production to meet the huge demand for dairy on the global market,” Voorbergen told just-food.
“The US was traditionally focused on local markets. When they exported it was because there was a surplus that had to be taken off the domestic market. In 2008, they responded to higher demand when there was a shortage situation.”
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By GlobalDataHowever, Voorbergen said that early indications on this year’s performance showed US exports would likely decrease in response to the extremely low prices on the global dairy market.
“They have learnt of the high volatility on the global market. By the end of this year, we will probably see them drop back down to similar levels as we have seen in the past,” he predicted.
