Why Skeptical Farmers Should Embrace Dairy Exports

Posted 10/01/2018 by Marilyn Hershey

The Chester County Holstein Club’s Field Day is a summer highlight for dairy farmers in the southeast corner of Pennsylvania.  

We enjoy the food, our families, neighborly conversations, cow judging and a calf raffle. 

My husband Duane and I hosted the event this year. A skeptical farmer approached me in our barn’s milking area.

I embrace conversations like this. I jokingly tell people a little-known historical fact -- dairy farmers invented skepticism.

“I don’t think we need exports,” the farmer said. “We need to stop focusing overseas.”

Dairy Exports By The Numbers

I informed him that for the first six months of 2018, U.S. dairy exports were equivalent to 16.8 percent of milk solids produced. By the way, that is our highest percentage ever for the first half of a year. I asked my neighbor what he thinks we should do with that American milk without global markets.

“I guess I never looked at it that way,” he said. “If we don’t export, I don’t know where that would go.”

Neither do I. But there is good news. An ambitious new checkoff-funded initiative called “The Next 5%” aims to increase exports from roughly 15 percent of production in 2017 to 20 percent of U.S. production in three to five years.

Why should skeptical dairy farmers embrace this goal?

Look at the chart below. It shows U.S. milk production is increasing at a faster rate than domestic milk consumption. In four years, the gap could grow to 1.4 million metric tons. 

Dairy Consumption and Exports

Graph sourced from U.S. Dairy Export Council - 09/26/18 

Under the leadership of President and CEO Tom Vilsack, a former U.S. Agriculture Secretary, the U.S. Dairy Export Council forecasts the world will need an additional 1.3 million metric tons of dairy products to meet global demand growth over the next three to five years. 

With extra funding from DMI and state and regional checkoff organizations, Vilsack has estimated we can increase cheese exports by 200,000 tons and dairy ingredient exports by 450,000 tons during that period. 

Secretary Vilsack remains confident we can still reach “the Next 5%.” 

Let’s hope he is right. Dairy farmers are hurting. Many are going out of business.

Some see globalization as the problem. But with 95 percent of the world’s population living outside U.S. borders, I disagree. 

Expanding our global reach is a key to our future success.

Checkoff funding of “The Next 5%” has enabled USDEC to put “more boots on the ground” in growth markets. Already this year, USDEC has hired business development directors, a key account manager, and an application scientist in China, Japan, South Korea, Southeast Asia and the Middle East/North Africa. 

USDEC also has formed partnerships with prestigious academic and culinary institutions in China and Singapore. These established relationships put us more in touch with market trends while demonstrating our commitment to global customers.

The sooner we as farmers can embrace the fact that globalization is here to stay, the better off we will be. USDEC is our vehicle for farmers and suppliers to work toward a common goal of moving more milk out of this country into other areas of the world.

If you have questions or comment about your checkoff-funded dairy exports program, feel free to leave it below or you can reach out directly to me at talktomarilyn@dairy.org.

 

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