Dairy US expects more competition from palm oil

This is what the American dairy export agency USDEC expects the latest preview. Although dairy prices have fallen in recent months, whole milk powder and cheese made from milk alone are still relatively expensive for some export destinations and also for some consumers in the US, especially when compared to the partially vegetable variants based on palm oil. Fat-filled milk powder and analogue cheese remain attractive alternatives for buyers with a limited budget, even in an even further declining market, according to the USDEC.

Last year, the export of fat-filled milk powder had almost the same difficulty as that of regular milk powder due to the high prices for vegetable oil; especially in Europe.

Drinking alternatives more expensive
Sales of drinks that serve as milk alternatives, on the other hand, will be more difficult this year, it is expected. The reason is that the raw materials required for this are 66% more expensive than cow's milk.

In the meantime, the export organization does not expect that huge volumes of dairy will be sold to China this year. Exports are more likely to remain at approximately the same level as last year. The cause of this is the Covid problems that China is still struggling with and the somewhat ailing economy in general.

Small stocks in China
Domestic whole and skim milk powder inventories are at their lowest levels since December 2020, according to information from the USDEC and the dairy industry.

American exporters also expect to face competition from Europe more often on the export market. Last year the European market was able to handle its own milk production reasonably well, this year much more will have to be exported from the EU, possibly at the expense of American exports.