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Shipping challenges leaving greater impact on dairy
CoBank’s lead dairy economist says the industry has been disproportionately impacted by container shortages when compared with other ag commodities.
“It’s getting hot, corn sitting in a hot container is not as big of a risk as say cheese or dry whey.”
“Cheese exports are down, dry whey products have been up remarkably, but this is in the context of increased demand out of China—I’d say that’s been the anomaly,” he says. “Exports like nonfat dry milk started the year down as well.”
He says China’s demand continues for dry whey, which was up three percent for the year, as they struggle with African Swine Fever.
At the same time, Ehmke says the U.S. is increasingly at a disadvantage to New Zealand who shipped a record number of dairy products to China in February.
“We’re going to see some potentially lost market share the longer this container issue plays out,” he says.
He says in recent weeks dairy prices have shown some rebounding which he credits to expected returning demand at foodservice domestically. Ehmke will be watching how consumers spend in the second quarter and their impact on prices.
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