Revenue from US dairy exports jumped 59% last year as prices rose to “unprecedented levels”, according to a report from research analysts Rabobank.
The value of dairy shipments reached US$2.9bn, the report said, with export volumes up 24% to 1.4m metric tons.
Overseas sales made up 11% of total US dairy production in 2007 and Rabobank said international markets were becoming increasingly important for the sector.
“If production growth continues to exceed that of domestic consumption, as is forecast for 2008, exports are going to become increasingly important to the ongoing profitability of the US dairy sector,” said Rabobank food and agribusiness research and advisory managing director Deborah Perkins.
“The share of production being exported has increased from 5% in 2002 to approximately 11% in 2007. Historically, exports have been assisted by government support, but the recent growth has been based on commercial merits.”
Mexico, south-east Asia and Canada accounted for the three largest destinations for US dairy exports in 2007, making up about 60% of the export market.
The report showed, however, that international prices have started to come down in recent months, falling between 3% and 15% from their peak in November 2007 to February 2008.
In the medium term, there could be further moderation in prices depending on domestic demand in key import regions, Rabobank said.