HIGHLIGHTS: FEBRUARY 21, 2025
• Advisory group meetings and overseas office one-on-ones
• USDEC testifies at Special 301 hearing
• Talking trade at WITA events
• Excellence in Exports awards nominations
• USDEC 2025 activity list
• Market Summary: China dominates GDT
• EU milk output falls in December
• EU dairy exports decline in 2024
• New Zealand milk production up in January
• New Algerian fluid milk plant
• Fonterra updates on divestiture, Studholme protein plant
• Colombia fines dairy processors for alleged whey use
• Company news: Burger King China, FrieslandCampina, Nestlé, Lactalis, Valio
Featured
Maximize your USDEC annual meeting engagement with advisory group sessions and one-on-ones with overseas offices
The upcoming USDEC Annual Membership Meeting features ample opportunities for members to engage with USDEC staff, overseas offices and peers to strengthen relationships, get answers to export questions and help set the organization’s course. While there will be chances to do so throughout the April 7-9 slate of activities at the at the Willard Hotel in Washington D.C., two unique opportunities come in the form of four USDEC advisory group/committee meetings and two blocks of time set aside for one-on-ones with USDEC overseas office representatives.
Advisory group meetings
The USDEC Trade Policy Committee will meet on Monday, April 7, the day prior to the general session, while the Cheese and Consumer Products Committee (C&CP), Ingredients Advisory Group (IAG), Market Access and Regulatory Affairs Advisory Group (MAG) and the Sustainability and Multilateral Affairs (SAMA) Advisory Group will assemble Wednesday, April 9—the day after the general session. The groups get together in person at least once per year, supplemented by virtual gatherings as needed. The April 9 meetings will take place concurrently.
The C&CP and IAG sessions will offer members a chance to help shape USDEC’s strategic priorities and ensure that those priorities effectively align with commercial business interests. The MAG meeting will provide regional updates on regulatory issues in key export markets, ongoing MARA projects, and other market access issues. The SAMA Advisory Group will offer a state-of-play update on current activities/partnerships and multilateral issues that have the potential to affect dairy trade and consumption.
Trade Policy Committee members should have already received calendar invitations about the April 7 Trade Policy Committee meeting.
One-on-one meetings with USDEC offices
Eight of USDEC’s international representative offices will attend the Annual Membership Meeting and will be available for 25-minute one-on-one sessions with members. The sessions are divided into two blocks:
- Monday, April 7, from 8:00 a.m. to 2:30 p.m.
- Wednesday, April 9, from 1:00 p.m. to 4:00 p.m. (after the advisory group meetings)
To select which office you would care to meet with and reserve your time, please click here. Each member can reserve one 25-minute slot per office. Please make sure to read the instructions before making your selections.
For more information
Questions related to the one-on-ones should be directed to Nuhami Alemu (nalemu@usdec.org) and Suzanna Stohr (sstohr@usdec.org). If you are interested in attending the advisory group meetings, please contact Nuhami Alemu (nalemu@usdec.org) regarding the C&CP meeting, Suzanna Stohr (sstohr@usdec.org) for the IAG meeting, Jessica Smith (jsmith@usdec.org) for the MAG meeting and Emily Dolan (edolan@usdec.org) for the SAMA meeting. Questions about the Trade Policy Committee meeting should be directed to Tony Rice (trice@usdec.org).
Register for the USDEC Annual Membership Meeting at this link, or visit the annual meeting page on the USDEC website to download the preliminary agenda, register for the meeting and see other meeting resources as they become available. We encourage booking rooms as soon as possible, as the cherry blossom bloom makes early April a busy time in the region. If you have any questions or issues with booking, contact Louise Kamali at lkamali@nmpf.org. We look forward to seeing you there!
USDEC defends common food names at USTR Special 301 hearing
This week, USDEC’s Shawna Morris, executive vice president, Trade Policy and Global Affairs, testified at a USTR hearing on the Special 301 review. The annual Special 301 review of the global state of intellectual property (IP) rights protection and enforcement informs USTR’s engagement on IP issues for the following year.
Morris, who spoke in her role as senior director of the Consortium for Common Food Names (CCFN), highlighted the EU’s ever-broadening scheme to monopolize generic names by falsely claiming them as protected geographical indications (GIs). (CCFN was founded and is staffed by USDEC.) The EU’s strategy includes incorporating GI protections in free trade negotiations with third countries to impose its unfair and expansive GI rules on markets around the world, effectively shutting out competition—most notably from the United States. Unlike most intellectual property rules, a foreign government is primarily driving GI registrations, not individual private-sector applicants.
“These are government-driven barriers to trade that require a government-driven response to counteract,” Morris said.
Her comments outlined the detrimental effects the policy is having on U.S. farmers and food producers and called for the U.S. government to “utilize all available tools to match the EU’s passion on this issue and stand up for American Agriculture.” That includes securing specific commitments from U.S. trading partners, ensuring the future ability to use common food and beverage names being targeted by the EU.
The public hearing complemented joint comments submitted earlier this year by USDEC and NMPF for the Special 301 review. Their comments referenced CCFN’s more extensive comments submitted at the same time.
WITA events offer opportunity to highlight shortcomings of USMCA, opportunities in dairy trade
This week, USDEC spoke at two events run by the Washington International Trade Association (WITA) highlighting the importance and benefits of trade. WITA is a non-profit, non-partisan organization dedicated to providing a neutral forum for the open and robust discussion of international trade policy and related issues.
Shawna Morris, USDEC executive vice president, Trade Policy and Global Affairs, spoke today at WITA’s U.S.-Mexico-Canada Agreement (USMCA) Review Series. The session, “USMCA: What’s Outstanding?” explored unresolved trade issues in the agreement, including dairy disputes, and potential paths forward to address them.
Tony Rice, USDEC director, Trade Policy, took part on Wednesday in the WITA webinar ,“Pathways to Opportunities,” for University of Nebraska students. The session explored careers in trade in the public and private sectors.
March 15 deadline quickly approaching to nominate for USDEC’s inaugural Excellence in Exports Awards
The deadline to submit entries to the new USDEC Excellence in Exports (ExEx) Awards is only three weeks away. USDEC invites members to nominate themselves, their teams, or a colleague today for the Excellence in Exports or Excellence in Innovation Awards. The awards ceremony will take place April 8 at the USDEC Annual Members Meeting at the Willard InterContinental Hotel in Washington, D.C. For more information about the ExEx Awards, including more about the criteria for each award category, please click here.
Events
USDEC 2025 events
For your convenience, USDEC has compiled a chronological list of dairy export-related member events currently slated for 2025. This list is effective as of Feb. 7 and will evolve as new opportunities develop, funding is finalized, or unexpected changes arise.
FEBRUARY
- Southeast Asia U.S. Dairy Ingredients Sweet Snacks Innovation Workshop, Singapore, Feb. 25, 2025
MARCH
- USDA Agribusiness Trade Mission, Guatemala, March 3-6, 2025
- FoodEx Tradeshow, Tokyo, March 11-14, 2025
- Food Ingredients China (FIC), Shanghai, March 17-19, 2025
- Central America Supplier Mission, Guatemala, Costa Rica, Panama – March 16-25, 2025
APRIL
- USDEC Annual Membership Meeting, Washington, D.C., April 7-9, 2025
- Ingredients Advisory Group, Washington, D.C., April 9, 2025
- Cheese and Consumer Products Advisory Group, Washington D.C., April 9, 2025
- Food and Hotel Asia Tradeshow, Singapore, April 8-11, 2025
MAY
- Southeast Asia U.S. Dairy Proteins Healthy Active Aging Innovation Workshop, Singapore, May 7-8, 2025
- China Bakery Exhibition, Guangzhou, May 10, 2025
- USDA Agribusiness Trade Mission, Hong Kong, May 12-16, 2025
- China Animal Husbandry Expo (CAHE), Qingdao, May 19-21, 2025
JUNE
- USDA Agribusiness Trade Mission, Peru, June 9-12, 2025
- Seoul Food and Hotel Trade Show, Seoul, June 11-14, 2025
- International Cheese and Dairy Awards, Stafford, England, June 25-26, 2025
JULY
- USDA Agribusiness Trade Mission, Dominican Republic, July 13-16, 2025
- Expo IAlimentos, Colombia, July 30-31, 2025
AUGUST
- Food Ingredients South America, Brazil, Aug. 26-28, 2025
SEPTEMBER
- U.S. Dairy Supply and Innovation Seminar, Thailand, Sept. 15, 2025
- Food Ingredients Asia, Thailand, Sept. 17-19, 2025
- Espacio Food and Service, Chile, Sept. 30-Oct. 2, 2025
OCTOBER
- USDEC Sustainability Seminar, Singapore, Oct. 6-9, 2025
- Food Tech Summit & Expo, Mexico, Oct. 8-9, 2025
- IDF World Dairy Summit, Chile, Oct. 16-25
NOVEMBER
- USDA Agribusiness Trade Mission, Mexico, Nov. 3-6, 2025
- COP30, Brazil, Nov. 10-21, 2025
- World Cheese Awards, Bern, Switzerland, Nov. 13-15, 2025
DECEMBER
- USDA Agribusiness Trade Mission, Cote D’Ivoire, Dec. 8-11, 2025
- 4th Quarter Joint USDEC Meeting of the Cheese and Consumer Products Advisory Committee and the Trade Policy Committee Meeting, Dec. 10-11, Washington, D.C.
Market Summary
China dominates latest GDT auction
The Global Dairy Trade (GDT) Price Index slipped 0.6% at the Feb. 18 auction, as prices moderated after widespread gains at the previous auction. Butter was the only product to post an increase this week—and it was a notable one. The average winning price for butter rose +2.2% to a new record high of US$7,378/MT, eclipsing the previous record set last June. Prices gained across all contracts as global butter demand remains robust. With New Zealand prices at a record high and the price advantage over the EU narrowing (as European prices continue to soften from their own record highs set last fall), the staying power of this week’s butter gains is likely short.
The overall Price Index decline came despite a correction in offer volumes that lowered WMP and SMP forecast quantities by 1,500 MT and 3,300 MT, respectively, over the next 12 months. It also bucked the growing number of reports out of New Zealand expressing concern over a prolonged run of dry weather as the 2024/25 season winds up. Poor pasture growth has caused some farmers to begin offloading cows, milking once a day and using costlier supplemental feed. Conditions suggest further easing of milk production growth, which had already been moderating over the last few months.
From a buying perspective, this week’s auction was almost the reverse of the previous event. North Asia (China), which took a back seat on Feb. 4, dominated purchasing, leading in all major product categories: WMP, SMP, butter, AMF and cheddar. China accounted for 37% of volume versus 30% the previous auction. While China is a perennial force on GDT, auction-to-auction expectations remain enigmatic.
Southeast Asia/Oceania and the Middle East, where demand surged at the last auction, were the ones to take a step back this week. Southeast Asia accounted for 26% of volume and the Middle East secured 14%, which, while still sizable, were well down from 31% and 21%, respectively, from Feb. 4.
The other notable buyer this week was Europe, which took 14% of overall volume—well elevated from normal buying levels, driven by demand for SMP.
The average winning price for WMP held steady at US$4,153/MT. SMP dropped 2.5% to US$2,754/MT. On the cheese side, mozzarella held steady at US$4,148/MT (-0.1%) and cheddar gave back nearly all of its gains from the previous auction, falling 3.4% to US$4,862/MT.
EU milk deliveries dip in December
The milk production momentum EU27+UK built over the three months ending November quickly evaporated in December. Year-over-year (YOY) December output slipped 0.2% (initial estimates after rising nearly 2% increase in November. Ireland’s milk rebound continued (+30.1%) and Poland (+3.8%) and the UK (+4.2%) contributed solid gains for the month. However, significant declines from Germany (-4.3%), Italy (-6.1%), France (-0.9%) and smaller producers like Greece (-20.6%) erased the gains.
German production has been struggling—the December decline was the seventh straight YOY monthly drop. But French deliveries fell for the first and only time in 2024 in December, and the Italian shortfall in December was its largest of the year.
The December decline was unexpected in light of the November increase, rising farmgate milk prices and solid dairy commodity prices across most products. But a second look at the November gain shows that the near 2% increase might have been inflated by low comparable output in November 2023. November 2023 deliveries were the lowest for the month in five years.
Full-year EU27+UK milk deliveries rose about 0.3%.
EU27+UK posts dairy export decline in 2024
YOY EU27+UK dairy exports (major products, not including fluid) increased just over 1% in December but finished the full year down 1% from 2023. Gains in whey, lactose and cheese were insufficient to offset declines in all other significant categories.
Milk powder took the biggest hit. EU27+UK shipments of WMP fell 22% (-57,146 MT), with about half that lost volume coming from slower sales to the Middle East/North Africa (25%, -29,809 MT). Exports of SMP dropped 8% (-67,510 MT), led by a sharp decline in volume to China (-57%, -38,895 MT).
EU27+UK cheese exports for the year were relatively flat, inching up only 0.6% (+6,301 MT). But the increase was enough to establish a new annual volume record and clear a notable milestone: The bloc exported more than 1 million MT of cheese in a year for the first time (1,000,452 MT). A 12% increase in volume to the U.S. (as well as solid gains to the Caribbean, the Middle East/North Africa and neighboring European countries) helped overcome significant declines to Japan (-21%, -20,981 MT), Chile (-30%, -8,399 MT) and China (-12%, -4,184 MT).
New Zealand milk production up 2.6% in January
New Zealand milk production outperformed expectations in January, rising 2.6%. Elevated farmgate payouts overrode concerns and higher costs associated with dry weather and worsening pasture conditions in key regions. Milk solids production in January fared even better, growing 5%. Through the first eight months of the 2024/25 season, New Zealand milk production was up 3% and solids production rose 4%.
Company News
Algeria opens new fluid processing facility
Algerian-government-owned dairy processor Giplait opened a major new dairy processing facility in the Rouiba industrial zone as part of ongoing plans to boost local capacity and reduce reliance on imports. The 5-billion-dinar facility (about US$37 million) can reportedly produce up to 1 million liters of subsidized pasteurized milk and 400,000 liters of UHT milk per day. (USDEC Middle East/North Africa office; The Maghred Times, 2/16/25)
Fonterra provides updates on consumer divestiture, Studholme site
Fonterra Co-operative Group is moving ahead on its plans to divest its Consumer business and integrated businesses Fonterra Oceania and Sri Lanka (see Global Dairy eBrief, 11/15/24). The co-op may divest via a sale or an IPO, choices it expects to continue to explore in the weeks ahead. In preparation for an IPO, Fonterra unveiled a new corporate identity and executive leadership for the consumer-facing businesses. The new company would be known as Mainland Group. René Dedoncker will lead Mainland as CEO-elect, with Paul Victor as CFO.
Separately, Fonterra provided an update on the $75-million project to transform its Studholme, South Island, site into a hub for high-value advanced proteins (see Global Dairy eBrief, 8/30/24). Fonterra said the site is on track for its first advanced proteins to come off the line in 2026. (Company reports)
Colombia’s SIC imposes fine on four dairy companies
Colombia’s Superintendency of Industry and Commerce (SIC) has sanctioned four of the country’s main dairy processors for allegedly adding whey to sterilized milk and presenting it as whole milk. The SIC imposed a fine of more than $21 billion pesos (about US$5 million) on Lactalis, Gloria, Hacienda San Mateo and Sabanalac, claiming the companies engaged in unfair competition by reducing costs without lowering the price of their products or informing consumers about the composition of their milk.
Lactalis Colombia publicly rejected the decision, issuing a statement that its milk has not been adulterated and that the sanction has no legal basis. It pledged to defend its position in court. (La Republica, 2/12/25)
FrieslandCampina reports soaring profits in 2024
In its fiscal 2024 annual results, FrieslandCampina reported revenue dropped 1.1% from the previous year, but operating profit jumped to €527 million (about US$551 million), up from €75 million (about US$78 million) in 2023. Jan Derck van Karnebeek, CEO of the Dutch dairy co-op, said last year had been a “year of transformation.” Thanks to a combination of cost reductions, an improved performance by its business groups and higher commodity dairy prices, co-op members would receive an “extra reward”—a supplementary cash payment of €1.21 per 100kg of milk.
He also noted that the proposed merger between FrieslandCampina and Milcobel (finalization expected by the end of 2025) will reinforce its international market position. Looking ahead, FrieslandCampina said it expects to achieve additional cost reductions in 2025 that will be used to offset inflation, facilitate growth and support the company’s profitability. Investments in 2025 will be below 2024 levels due to the completion of large projects last year. (Company reports)
Nestlé reports “solid” 2024 performance
In its 2024 full-year report, Swiss food giant Nestlé saw revenues drop 1.8% and net profit decrease 2.9%. Despite an increase in invested capital in the Milk Products and Ice Cream segment, 2024 sales in that segment dropped roughly 5% from the previous year. CEO Laurent Freixe said the performance was solid and in line with the company’s latest guidance “in a challenging macroeconomic context and soft consumer environment.” Looking to 2025, he said that increasing investment to drive growth is central to the company’s plan, and it is creating the fuel for these growth investments through a new CHF2.5 billion (about US$2.8 billion) three-year cost savings program. (Company reports)
Brazil and France partner to promote cheese production in São Paulo state
The Brazilian state of São Paulo and the French Embassy launched a collaboration that aims to establish between five and 10 cheese production schools in Brazil. Through the partnership, which kicked off with a January workshop that brought together representatives from both organizations, cheese producers will receive training from government technicians in partnership with French specialists. A São Paulo government official said the goal of the initiative is to cover all regions in the state with cheese production training units to drive diversity and quality. (Dairy Global, 2/11/25)
Mergers, acquisitions and joint ventures
Restaurant Brands International paid a reported US$158 million to acquire most of the outstanding shares of Burger King China. The company now has nearly full-ownership of the business, which includes almost 1,500 Chinese Burger King outlets. The company said it is looking for a new partner in the market amid a tough competition and softer demand. … In a move to expand its local market position, French dairy company Lactalis said it plans to buy Granja Pocha, a Uruguay-based dairy company that produces cheese and yogurt under the Colonial brand. … Finland-based dairy company Valio agreed to acquire the plant protein business and the Härkis and Beanit fava beans brands from Raisio plc for €7 million (about US$7 million). Valio said the deal, which is expected to be complete next month, is part of its strategy to grow “from a dairy company into a food company.” (Company reports; Reuters, 2/18/25; Just Food, 2/18/25)
Company briefs
Uganda’s Pearl Dairy Farms expanded its range of dairy and nutrition products in Africa with the launch of Lato Frutish, a new powdered milk drink available in apple, mango, and strawberry flavors. … Nashville-based Purity Dairies said it will stop making ice cream products at its Athens, Tennessee, facility. The plant will replace those products with Mayfield Dairy ice cream products. Kansas City-based Dairy Farmers of America owns both companies. (USDEC Middle East/North Africa office; Dairy Business Africa, 2/13/25; Company reports; Nashville Post, 2/13/25)
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