Promising Outlook for U.S. Dairy Exports

Promising Outlook for U.S. Dairy Exports
I’m KayDee Gilkey with today’s Open Range.

The biggest markets for U.S. dairy are Mexico, Southeast Asia and Canada. However - economic issues occurring in other markets overseas seem to be providing more opportunity. Here’s U.S. Dairy Export Council Vice President of Communications Alan Levitt with more.

Levitt: “I think we are in a great position right now because of the drought right now in New Zealand their production is really pulling back significantly. Australia is in somewhat of the same boat -- the weather hasn’t been quite as bad but their production is down. Argentina production is down. Europe is down because of low margins. While we do have the low margins in the United States, we are actually one of the only dairy exporters that is growing production. So we are in a great position to increase our share in 2013.”

Levitt says the world market has to be willing to pay a price that covers U.S. dairy producers’ costs.

Levitt: “That’s really the thing we are watching is are we going to get to a point when the world is willing to pay for our milk. We are not quite at that point yet in terms of the cycle we’re still below where we need to be -- but we are getting there.”

Over time - Levitt says milk prices have been increasing and will increase because the world needs milk - and consumers have to give producers an incentive to actually produce milk. He says it’s all about finding a balance - though - because if prices are high enough - countries importing those products may decide to produce their own products.