HIGHLIGHTS: DECember 1, 2023
• Proposal seeks administration support to bolster U.S. ag trade
• Indonesia approves U.S. halal certifier
• Indian dairy certificate set to launch Jan. 1
• U.S. dairy delegation heads to COP28
• USDA taking applications for RAPP funding
• U.S. permeate workshop in China
• Dairy Summit takes place in Mexico
• Castaneda highlights need for collaboration at FEPALE meeting
• USMCA dispute yields disappointing result
• REGISTER NOW: All-Member Webinar Dec. 13
• USDEC at nutrition conference in Philippines
• U.S. dairy presence at Brazil’s Dairy Vision
• USDA announces slate of 2024 ag trade missions
• Market Summary: China dairy imports decline in October
• USDEC releases latest International Demand Analysis
• GDT flat; NZ milk output falls for fifth straight month
• Darigold plans Boise office
• Lakeland Dairies restructures
• KCMMF expands in Middle East
• Company news: New Viet Dairy, McDonald’s, Arla Food Ingredients, Mengniu Dairy, Lactalis
Featured
President’s Export Council approves ag trade proposal
On
Wednesday, the President’s Export Council (PEC) approved a proposal to
bolster U.S. agriculture’s competitive standing around the world. The
proposal, which USDEC worked with Land O’Lakes to develop (Land O’Lakes
President and CEO Beth Ford serves on the PEC), provides guidance for
the administration to expand export market opportunities for U.S. food
and agriculture, eliminate unwarranted nontariff trade barriers and
reinforce global food security.
USDEC and NMPF also helped develop a letter to PEC members in support of the proposal before the vote, ultimately getting 35 U.S. agricultural associations to sign on.
The
letter (which recaps the proposal) asks the PEC to take a series of
four actions to support the U.S. dairy and broader agriculture sectors:
- Increase collaboration on diversifying the U.S. agricultural supply chain
by urging the administration to develop recommendations to diversify
sourcing and/or incentivize cost-effective U.S. production of inputs to
maintain U.S. agricultural production.
- Establish a robust agricultural trade agenda
that includes strategies such as expanding domestic trade promotion
programs, recommitting to comprehensive trade agreements, and
eliminating tariff and non-tariff trade barriers to enhance the ability
of American producers to gain export market access and maintain
competitiveness.
- Enforce existing trade agreements, including through strengthening the WTO dispute resolution process and enforcing all U.S. free trade agreements.
- Lead on international sustainability and climate efforts
by urging the U.S. government to coalesce around a united message on
agricultural sustainability that focuses on voluntary, incentive-based
programs to support sustainable productivity growth; keeps food
accessible; supports climate-smart agricultural practices; and provides
additional market opportunities.
“U.S.
agriculture is a global leader in sustainable production and innovative
practices that enable us to feed a growing world population,” the
letter states. Trade barriers and setbacks that U.S. suppliers have seen
this year not only threaten U.S. economic growth but global food
security, the letter goes on to state. “Fortunately, the PEC and U.S.
government have the infrastructure and resources to tackle these
challenges, and it begins with the proposal that we’ve laid out.”
Click here for a copy of the PEC agriculture proposal sent to the president.
Indonesia approves one U.S. halal certifier; others pending
Indonesia's
Ministry of Religious Affairs’ Halal Product Guarantee Organizing
Agency (BPJPH) signed a mutual recognition agreement (MRA) with Foreign
Halal Certifying Bodies (FHCBs) at this year’s H20-Halal World 2023
conference in Jakarta in mid-November.
The
Islamic Food and Nutrition Council of America (IFANCA) is currently the
only U.S. FHCB that is fully recognized and listed on the MRA. With the
MRA signing, dairy products certified by IFANCA are recognized to be
halal and allowed for export to Indonesia after Oct. 17, 2024.
Additional
U.S. halal certifying bodies—American Halal Foundation (AHF), ISWA
Halal Certification Department, Islamic Services of America (ISA) and
Halal Transaction of Omaha (HTO)—have completed their initial
assessments and are moving through the audit process set forth by BPJPH
for mutual recognition and acceptance of their halal certificates in
Indonesia.
USDEC
is following this situation closely and will update members as the
remaining U.S. halal certifiers complete their assessments. Members are
advised to work closely with their importers on the registration of
these foreign halal certificates. In the meantime, if you have any
questions, please contact Aimee Pinkerton at apinkerton@usdec.org.
Importer action required to request Indian certificate delay
India’s
Department of Animal Husbandry and Dairying (DAHD) previously delayed
the implementation of its new model dairy health certificate through the
end of 2023 via an Office Memorandum of July 17. As of now, however, no further delays have been announced.
Barring
a last-minute postponement, the new certificate will be implemented as
scheduled on Jan. 1, 2024, halting market access for U.S. whey and
lactose products (except pharmaceutical lactose). If any importers wish
to see a delay in the implementation of the new certificate, they are
encouraged to reach out to DAHD to express their interests.
USDEC
continues to work with the U.S. government (USG) to explore paths
forward on the longstanding certificate impasse. As noted in previous Global Dairy eBrief stories (see July 7, 2023, April 7, 2023, and Jan. 6, 2023),
the USG cannot endorse the current DAHD certificate or the new
integrated certificate given the problematic nature of various
attestations. See Volume 2 of the USDEC Export Guide for more information. Please contact Sandra Benson at sbenson@usdec.org with questions.
U.S. delegation heads to COP28
USDEC
is leading a U.S. dairy delegation to the UN Climate Change Conference,
also known as COP28 (the 28th Conference of the Parties to the UN
Framework Convention on Climate Change). COP28 provides an important
opportunity to educate policymakers and thought leaders on the
contributions U.S. dairy is making to food systems and the concrete,
voluntary steps the sector is taking to decrease environmental impact.
It also presents numerous opportunities to highlight the role of trade
and dairy exports as climate solutions that deliver sustainable
nutrition.
The
USDEC delegation consists of Alex Peterson, U.S. dairy farmer and USDEC
interim chair; Marilyn Hershey, U.S. dairy farmer and DMI chair; Nick
Gardner, USDEC senior vice president, Sustainability and Multilateral
Affairs; Kelly Sheridan, USDEC vice president, Environmental Affairs;
and Jerry Brown, USDEC senior vice president, Communications.
The
conference promises to focus more on food systems than any COP in the
past. Through participation in panels and roundtables and extensive
on-the-ground engagement over the course of the agriculture portions of
the meeting, the group aims to:
- Ensure that U.S. dairy maintains a voice and a seat at the table at this influential gathering of policymakers.
- Demonstrate
U.S. dairy climate and nutrition leadership, including the commitment
to continuous improvement through innovation, technology and generation
of revenue streams for producers.
- Highlight
the important role of trade in delivering sustainable nutrition,
providing food systems resilience and meeting the nutrient needs of a
growing global population.
- Promote U.S. dairy producer perspectives, experiences and priorities at key moments during the meeting.
“Despite
an increasing global influence, COP remains a challenging environment
for dairy and livestock producers due to the prevalence of
anti-livestock voices, participants with little or no knowledge of
agriculture and food production, and overall skepticism to the
sustainability of international trade in food and ag products,” says
Gardner.
COP28
runs from Nov. 28-Dec. 12, but the main agricultural portions take
place from Dec. 5-10. USDEC will provide further coverage of COP28
through several communications channels, including USDEC social media,
the U.S. Dairy Exporter Blog and upcoming issues of Global Dairy eBrief. Stay tuned for more.
USDA opens applications for RAPP
USDA
has begun accepting applications for the first tranche of funding under
the new Regional Agricultural Promotion Program (RAPP). USDA is
providing up to $300 million in its first funding tranche to support
eligible projects aimed at helping ag suppliers break into new markets
and increase share in growth markets (in total, the full RAPP budget is
$1.2 billion). As the U.S. dairy industry’s FAS-recognized cooperator,
USDEC is preparing to submit funding applications to tap into this new
resource opportunity. RAPP’s creation is a response to the extensive
advocacy USDEC, together with others in the agricultural community, have
conducted regarding the need to double export promotion funding.
The
first tranche of funds specifically focuses on market diversification
and therefore excludes certain established U.S. agricultural buyers,
including China, Mexico, Canada and the EU. USDA identified three
regions receiving special emphasis for the first tranche: Africa, Latin
America/Caribbean and South/Southeast Asia. Additional information on
RAPP is available at grants.gov.
Bakery workshop in China wows participants with permeate’s versatility and functional and cost benefits
USDEC
held its first ever workshop in China focused on permeate use in baked
goods. A series of permeate and baking experts spent the day with more
than 60 representatives from the baking industry discussing dairy
permeate, its uses and its many benefits and applications. The
instruction was all the more helpful because attendees saw bakers
actually make breads and then had the opportunity to taste them on the
spot, along with cakes, cookies and other products made with permeate.
Other ideas such as new product prototypes and existing commercial
products were also shown.
USDEC
worked with the China Association of Bakery and Confectionery Industry
(CABCI) to organize and host the event, which was held in Shanghai and
featured two food scientists, two chefs, CABCI leaders and USDEC staff.
“We
looked at the workshop as a continuation of our efforts to expedite the
utilization of U.S. permeate in baked goods in China, which has been a
focus of USDEC ingredient marketing efforts in the country since China
approved it for food use in 2020,” said Annie Bienvenue, USDEC vice
president, Global Ingredients Marketing.
Attendees, speakers, CABCI and USDEC staff from November’s permeate bakery workshop in Shanghai.
The
workshop kicked off in the classroom with welcome speeches by the
leaders of CABCI, Bienvenue and USDEC China office representative Chang
Su. Additional classroom instruction followed, together with extensive
product sampling.
- Long-time
USDEC consultant, Dr. Gary Hou, senior managing director and director
of the Flour Development & Food Innovation Center for South Korean
food manufacturer SPC Group, shared the functional benefits of permeate
and highlighted its application in 10 international bakery applications
ranging from cake and muffins to tortillas and several pan breads.
- Lina
Zhang, associate professor at Jiangnan University (JU), introduced
dairy permeate, its long history of international use and the potential
benefits it could bring to the Chinese population. She shared some of
the prototype applications developed at JU such as twisted fried dough,
Guoba (millet cracker), and other bakery product and fillings relevant
to China that USDEC has commissioned over the years.
- Chef
Dong Han, Liaoning Vocational Technical College of Modern Service,
shared his experiences with permeate as he developed and tested, with
his students, 10 items covering Western and Chinese bakery and pastry
products.
Dr. Gary Hou highlighted permeate benefits in 10 bakery applications, including an American pan bread.
Chef Dong Han shared the benefits he observed while developing 10 recipes using permeate.
Dr.
Lina Zhang explained how permeate is derived from milk and/or whey as
well as the prototype development work that JU has done with the
ingredients since its approval in 2020.
Product
samples, baked by Chef Han and presented at the workshop, encompassed a
variety of breads and pastries, including soufflé cookies, zucchini
muffins, croissants, mooncakes and walnut cake.
After
the classroom portion, the workshop moved to a bakery demonstration
kitchen. Chef Yuwei Lin, renowned Taiwanese baker and owner of three
Daico Bakery outlets in Beijing, held a live demo, making 10
permeate-containing bread items created for the event.
USDEC
members also participated in the workshop. One member presented about
their company, others had display tables and many more attended and
interacted with the participants.
The
entire event was recorded and the video (with Chinese audio) will be
shared shortly with the attendees. USDEC has already received interest
and requests for permeate samples from some participants to conduct
R&D trials.
Chef Yuwei Lin demonstrates to workshops participants how he shapes a specialty bread made with U.S. dairy permeate.
Left
to right: Annie Bienvenue, Chef Yuwei Lin, Gary Hou, Chef Dong Han and
Chang Su show off Chef Lin’s 10 permeate-containing breads made during
the permeate workshop.
Attendees sample some of the multitude of baked goods from the permeate workshop.
Castaneda stresses importance of collaboration at FEPALE annual meeting
This
week, Jaime Castaneda, USDEC executive vice president, Policy
Development and strategy, participated in the Pan American Dairy
Federation (FEPALE) 31st Annual Meeting in Santo Domingo,
Dominican Republic. Castaneda spoke about the partnership between USDEC
and FEPALE to defend the image of dairy and promote trade.
FEPALE
plays an important role in the Latin American region promoting science
and trade facilitation with not only the private sector, but also in
government in the Americas. Castaneda, currently serving as FEPALE vice
chair, reaffirmed the organization’s work in the region to defend dairy
farming and manufacturing before international organizations, especially
with respect to nutrition and sustainability.
The
Dominican Republic hosted the meeting with representatives from several
countries across North and South America, including the U.S., Canada,
Mexico, Nicaragua, Costa Rica, Panama, Colombia, Ecuador, Chile,
Argentina, Uruguay, Paraguay, Brazil and Bolivia.
USDEC’s
Jaime Castaneda, currently serving as FEPALE vice chair, spoke on the
importance of partnerships and collaboration to defend dairy on the
global market.
Representatives from more than a dozen countries of the Americas attended this year’s FEPALE Annual Meeting.
U.S. dairy ingredients highlighted at Dairy Summit Mexico 2023
USDEC
led extensive programming at November’s Dairy Summit Mexico 2023 to
educate attendees about U.S. dairy ingredient applications and benefits.
The Dairy Summit, which is organized by Instituto de la Carne y de la
Leche A.C. (INCALEC), one of USDEC’s partners in Mexico, is a bi-annual
event that consists of a main conference program, workshops and a
mini-trade show. USDEC participated in all three sections of the summit,
which was held November 14-16 in Aguascalientes.
During
the conference portion, Rodrigo Fernandez, leader of USDEC’s Mexico
office, presented the U.S. dairy story to 160 attendees. He provided an
overview of the USDEC organization, the U.S.-Mexico dairy trade
relationship and Mexican consumption trends.
USDEC
also led training workshops for bakery and native Mexican cheeses,
highlighting U.S. dairy ingredients’ flavor, functionality, nutrition
and economic benefits. Dr. Rebeca Garcia, a professor from Tec de
Monterrey, conducted the cheese workshops. Gerardo Avena, who operates
the Avena Center for Culinary Arts and Food Science, was the bakery
workshop’s trainer. Each workshop included a classroom portion and a
hands-on session that gave participants the opportunity to apply their
new knowledge by using U.S. dairy ingredients to make these products.
USDEC’s
booth on the trade show floor offered a platform to increase the
visibility of U.S. dairy ingredients and network with potential buyers
from throughout the region. Roughly 1,200 people attended this year’s
event.
“The
Summit was larger than in previous years, so USDEC’s role this year was
larger as well,” said Terri Rexroat, vice president, Global Ingredients
Marketing.
Other
sponsors included La Cámara Nacional de Industriales de la Leche
(CANILEC) and The Chamber for Bakery Industry of the State of
Aguascalientes.
Rodrigo
Fernandez, head of the USDEC Mexico office, gives attendees an overview
of USDEC and provides updates on Mexican dairy consumption trends and
the U.S.-Mexico dairy trade relationship.
A full house of food and beverage industry professionals came for USDEC’s dairy ingredient workshops at Diary Summit Mexico 2023 to learn about U.S. dairy ingredient applications, functionality and other benefits.
USMCA dispute settlement panel delivers disappointing result on Canadian dairy challenge
USDEC
and NMPF expressed extreme disappointment with the findings of a
U.S.-Mexico Canada Agreement (USMCA) dispute settlement panel released
during Thanksgiving week. The panel rejected the U.S. argument that
changes to Canada’s dairy tariff rate quota (TRQ) system were
insufficient to align with its USMCA commitments.
The U.S. originally challenged Canada’s faulty TRQ administration system in 2021, with a USMCA dispute settlement panel finding
that the initial scheme improperly restricted access for U.S. dairy
products in violation of Canada’s USMCA TRQ commitments. In response,
Canada made minor modifications to the system but failed to address U.S.
concerns.
Under
the revised system, Canada continues to restrict U.S. access by
awarding the lion’s share of import quotas to Canadian dairy processors,
who have a vested interest in keeping U.S. products out of the market,
rather than granting equitable access to retailers, foodservice
operators and importers who want to import U.S. dairy goods. The U.S.
initiated the second challenge earlier this year.
“By
allowing Canada to ignore its USMCA obligations, this ruling has
unfortunately set a dangerous and damaging precedent,” said Krysta
Harden, USDEC president and CEO, in a joint USDEC/NMPF press release on the decision.
USDEC
remains committed to working with USTR and USDA to evaluate efforts to
address Canada’s continued harmful actions that depress dairy imports
while simultaneously evading USMCA’s dairy export disciplines.
Events
USDEC All-Member Webinar: leadership elections, Operating Plan review
You
won’t want to miss USDEC’s All-Member Webinar on Dec. 13 at 1:00 p.m.
ET. The online meeting will be packed with information on the latest
export developments and USDEC business, including a review of the 2024
Operating Plan and leadership elections. Staff will provide
organizational updates and delve into how USDEC plans to tackle industry
challenges and continue to facilitate long-term U.S. dairy export
growth. The webinar includes a Q&A session where members can ask
questions about the Operating Plan and the staff presentations.
To register for the event, click here.
Registration is encouraged but is not a prerequisite. If you would like
to attend the webinar without registering, a Zoom link will be sent to
members in upcoming promos and will also be available on the USDEC
website. If you have any questions, please contact Luke Waring at lwaring@usdec.org or Weston Abels at wabels@usdec.org.
U.S. dairy presence at Brazil’s Dairy Vision conference
USDEC
members connected with peers from Latin America, and USDEC Senior Vice
President Sustainability and Multilateral Affairs Nick Gardner spoke at
the 9th annual Dairy Vision conference, which took place Nov. 7-9 in
Campinas, Brazil. Dairy Vision brings together dairy experts from around
the world to explore—from national and international perspectives—the
opportunities and challenges facing the business. This year’s event
attracted more than 400 dairy sector participants, primarily from Brazil
but also from the U.S., France, Argentina, Uruguay and other countries.
The
two days were split into three areas of focus: Retail Opportunities and
Trends, Opportunities from the Environmental Agenda, and New Ideas for
the Future. Throughout the event, in-depth discussions revolved around
potential market scenarios for the coming years, the dairy sector
economy, the Brazilian and international dairy markets, artificial
intelligence and sustainable production. Gardner’s presentation during
the New Ideas for the Future portion centered on how U.S. dairy is
working collectively to be part of the dairy market of the future.
Dairy
Vision 2023 provided a platform for networking and connecting with
dairy industry professionals, including USDEC members and companies from
the dairy sector, such as Laticinios Bela Vista and Alibra
Ingredientes.
Importance of protein quality and quantity in the spotlight at Philippines conference
Last
week, nutrition expert Cecilia Acuin, Ph.D., delivered a presentation
at the Philippines Association for Food Technologists (PAFT) 62nd annual
convention in Manila. PAFT is a non-profit professional organization
for food technologists in the Philippines; the 400+ attendees who came
to this year’s event are PAFT members.
As
USDEC’s invited speaker, Acuin’s attendance was part of USDEC’s
continuing efforts to relay the advantages of innovating health and
wellness applications using U.S. dairy proteins to the Filipino food and
beverage product development community.
In
her presentation, “Nutrition Matters: Not All Proteins are Equal,”
Acuin discussed the need for protein intake to be based on both quantity
and quality, positioned Digestible Indispensable Amino Acid Score
(DIAAS) as the optimal evaluation method of protein quality assessment,
and offered recommendations on how to increase protein consumption in
the Filipino diet, drawing upon USDEC recipe formulations such as Ube
Biko. (Acuin, an influential nutrition thought leader in the
Philippines, also participated in USDEC’s September workshop,
“Optimizing Healthy, Sustainable Eating with U.S. Dairy Proteins,” see Global Dairy eBrief, 9/15/23.)
An
estimated 200 people attended the dairy-related breakout session,
mainly food technology professionals, students and government
representatives. This is the second year USDEC has participated in the
PAFT conference. Last year, Martin Teo, technical director–food
applications, Southeast Asia, spoke on the Philippines’ friendly
ideation and innovation with U.S. dairy ingredients for health and
wellness applications.
USDA announces 2024 ag trade missions
USDA
will lead six agricultural trade missions from March to December 2024
to a mix of established and new markets for U.S. suppliers. “Market
diversification is an important tool for maximizing growth opportunities
for U.S. agriculture, as well as hedging risk of market contraction and
general volatility in the global marketplace,” said USDA Secretary Tom
Vilsack.
Mission destinations for 2024 and approximate dates are as follows:
- Luanda, Angola – February 26-29, 2024 (rescheduled from 2023)
- Seoul, South Korea – week of March 25
- New Delhi, India – week of April 22
- Vancouver, Canada – week of June 17
- Bogota, Colombia – week of July 29
- Hanoi and Ho Chi Minh City, Vietnam (with buyers from Thailand) – week of Sept. 9
- Casablanca, Morocco (with buyers from Senegal and Francophone West Africa) – week of Dec. 2
The
mission to Vietnam aligns with the Food Ingredients Asia (Fi Asia)
show, which takes place Sept. 4-6, 2024, in Jakarta, Indonesia. USDEC’s
Ingredients Team is also developing plans for activities around the
show, including a possible ingredients workshop prior to the show,
providing an extended opportunity for members to connect with existing
and potential new buyers in Southeast Asia. For more information on Fi
Asia, please contact Keith Meyer at kmeyer@usdec.org.
Market Summary
Chinese dairy imports decline again in October
Chinese
dairy imports (major products, not including fluid or infant formula)
fell for the third straight month in October, although the
year-over-year (YOY) dip of -4% was the lowest in the streak. WMP
remains the biggest drag on sales, with YOY import volume down 32%
(-8,848 MT) in October. Year to date, China has slashed WMP imports by
more than 235,000 MT from 2022 (which itself was nearly 150,000 MT less
than in 2021). Growth in domestic WMP production, strong domestic stocks
and the ongoing shift to fluid milk continue to hamper import demand.
Butterfat
imports also dove in October. After two straight months of YOY gains,
butter volume fell 12% (-713 MT). AMF imports declined 41% (-1,617 MT)
after three months of double-digit YOY gains. Year to date, Chinese
total butterfat imports were off by 9% (-11,011 MT) through October.
Chinese SMP imports inched up 1% in October. While only a small gain, it was the first increase in YOY volume in three months.
Whey results mixed
Low-protein
whey (0404.10) and WPC80+ continued to move in opposite directions in
October. WPC80+ imports rose 4% (+101 MT), marking three straight months
of gains. But reduced feed demand from China’s lagging pig sector
continued to vex low-protein whey imports, which fell 4% (-1,999 MT). It
was the fourth straight month of falling whey imports, although the
smallest of the streak.
Cheese stars
On
a positive note, China’s YOY October cheese imports grew 15% (+1,473
MT) and have been up in nine of 10 months this year, boosted by a
revived foodservice sector. Furthermore, China’s cheese imports from the
U.S. nearly quadrupled in October to 2,056 MT (+1,535 MT)—a number
telegraphed by September U.S. export data that showed record U.S. cheese
shipments of 1,999 MT to China for the month. Year to date, Chinese
cheese imports were up 18% (+22,452 MT) through October and are less
than 1% below the record pace of 2021.
Chinese
YOY lactose imports soared 47% (+5,317 MT) in October, and fluid milk
and cream recorded its first increase in 20 months.
Overall, Chinese import demand apart from cheese remains subdued and questions about its national economy continue to linger.
USDEC International Demand Analysis with September data ready for download
Economic
headwinds and challenges in Chinese demand continued to hamper global
dairy trade in September. Year-over-year trade in milk solids equivalent
(MSE) terms fell 7% for the month, according to the latest USDEC International Demand Analysis.
It was the third monthly decrease in a row and the largest percentage
of the three. All three major dairy suppliers posted declines, with EU
volume falling 1.9%, U.S. volume off 13.2% and New Zealand dropping
14.6%. For the complete analysis, download the report here.
The International Demand Analysis
is packed with charts, graphs and commentary, providing members with a
forward-looking glimpse at world markets from a U.S. exporter’s point of
view. The report analyzes demand in the key markets for cheese,
NFDM/SMP, whey (HS Code 0404.10) and WPC80+, and also includes shorter
summaries for lactose, butterfat and WMP. For questions and comments,
please reach out to William Loux (wloux@usdec.org) or Stephen Cain (scain@nmpf.org).
GDT flat; NZ milk production nearly flat
The
Nov. 21 Global Dairy Trade (GDT) auction yielded mixed results product
by product, but it delivered a flat performance overall. The GDT Price
Index did not change, as small gains in AMF and heavily weighted WMP
offset more sizable declines in SMP and cheddar. Reductions in the
12-month forecast volumes for butter and AMF, slowing milk supply growth
in the EU, U.S. and New Zealand, and increased talk of negative impacts
in New Zealand from a worsening El Nino failed to ignite a rally.
The
biggest pricing change came in cheddar, which dropped 9.7% to
US$3,637/MT. It’s the lowest GDT cheddar price in almost exactly three
years and narrows the gap with the CME U.S. block price, which closed on
Wednesday at US$1.59/lb. or US$3,505/MT. GDT cheddar had been moving in
range between US$3,850 and US$4,125 for the previous eight auctions
before this week’s plunge.
While
North Asia (China) continued as the biggest overall buyer at the Nov.
21 auction, but volumes were down across all categories except cheddar
compared to the previous auction. The Middle East showed the most signs
of life, increasing purchasing of WMP, SMP and AMF compared to the
previous auction and the same auction the previous year. It was the top
buyer for AMF and the No. 2 buyer for WMP behind North Asia (China).
The
most surprising result came in SMP. NZX futures markets suggested a 3%
gain heading into the event, but prices fell 3.8% to US$2,622/MT. That
comes after four consecutive auction gains over which time the SMP price
increased 19%.
With
the flat outcome Nov. 21 following a 0.7% decline on Nov. 7, the
bullish feelings that had been developing in September and October have
decidedly mellowed.
NZ milk output slips
It
remains to be seen whether concerns over New Zealand milk production
will be strong enough to goose prices at the end of the year. NZ milk
0.3% in October, the peak month of its collection season. It was the
fifth straight monthly decline. However, like September, milk solids
output increased over the previous year, rising nearly 1%.
Season
to date (June-October), New Zealand milk production is down 0.7%, while
milk solids volume is up 0.6%. With improved pasture conditions,
November and December could see milk volume return to growth.
Company News
Darigold to open Boise office
Seattle-based
Darigold plans to open a new office in the Boise, Idaho, area. The new
site “gives us greater access to a larger workforce focused on
agriculture, creates a better opportunity to establish Darigold as an
employer of choice and valued community partner, and establishes a
presence closer to some of our farming and production operations in
other parts of our regions,” said Joe Coote, CEO. The company hopes to
secure the space in early 2024. Completing tenant finish and staffing
will take 18-24 months, Darigold estimates. (Company reports)
Ireland’s Lakeland Dairies announces manufacturing realignment
Between
now and the first quarter of 2025, Ireland’s Lakeland Dairies plans to
close three manufacturing sites, build a new fluid milk processing plant
in Killeshandra, County Cavan, and align future investment toward
value-added products. The company is closing its milk drying plant in
Lough Egish and its butter facility in Banbridge in June 2024. The
Lakeland Dairies fluid plant in the town of Monaghan will shut down in
early 2025, with production transferred to a new facility at the
company’s Killeshandra site. The company plans to sell the Monaghan
fluid plant and the Banbridge butter facility. “The next decade will be
less about large volume growth and more about value-added growth and
adding capability throughout the business,” said CEO Colin Kelly. (Company reports)
Kerala Milk Federation inks deal to sell products at Lulu outlets in Middle East
India’s
Kerala Cooperative Milk Marketing Federation (KCMMF), known by its
trade name Milma, entered an agreement with retail giant Lulu Group to
sell Milma dairy products in Lulu’s extensive network of Middle Eastern
hypermarkets and malls. The Memorandum of Understanding, which was
signed at the World Food India 2023 conference in New Delhi, aims to
expand the range of dairy products available in Lulu’s stores to reach a
wider segment of the population. KCMMF Chairman K.S. Mani said Milma is
aiming to move the cooperative forward by looking beyond its
traditional milk and curd products to additional offerings.
The
deal will initially place five long shelf-life Milma products—ghee,
premium dark chocolates, golden milk mix powder (a health drink),
instant paneer-butter masala and palada payasam mix—in Lulu
hypermarkets, with the goal of eventually increasing the number of
products sold at Lulu outlets to 25. The cooperative estimates the
agreement will generate roughly US$12 million in the first two years. (USDEC Middle East/North Africa office; Agritimes, 11/7/23)
Sojitz acquires New Viet Dairy
Japanese
conglomerate Sojitz Corp.—together with Sojitz Asia and Sojitz
Vietnam—jointly acquired full ownership of Vietnamese
importer/distributor DaiTanViet Joint Stock Co., also known as New Viet
Dairy. New Viet Dairy has a significant presence in dairy ingredients
and cheese. Sojitz plans to collaborate with its subsidiary Huong Thuy
Manufacture Service Trading Corp. to establish a broadline wholesale
food distribution business in Vietnam focused on independent retailers,
mass merchandisers and mid- to high-end hotels and restaurants. (Company reports)
Mergers, acquisitions and joint ventures
McDonald’s is buying back Carlyle Group’s
28% stake in the fast-food giant’s China business. McDonald’s sold the
bulk of the China business to Carlyle and Chinese-state-owned Citic
in 2017; Citic will retain a 52% share. Since 2017, McDonald’s has
doubled its footprint in China to more than 5,500 units and plans to
reach 10,000 stores by 2028. … Danone plans to collaborate with Else Nutrition,
a Canadian supplier of plant-based infant formula. The first stage of
their partnership is a license agreement that will add Else’s products
to Danone’s specialized nutrition portfolio and see Danone market and
commercialize the line. (USDEC China office; CNBC, 11/20/23; Just Food, 11/14/23)
Company news briefs
Mengniu Dairy
has entered the Chinese baked goods sector with the launch of a
high-calcium biscuit in two varieties: milk and cheese. The products use
cheddar from Denmark, butter from New Zealand and milk powder and fluid
milk from Mengniu. … Arla Foods Ingredients CEO Henrik
Andersen is stepping down to pursue a new career path. Andersen has
been with AFI since 1994 and held the CEO position since 2010. Luis
Cubel, AFI’s vice president, commercial, will take over as the new CEO
effective Feb. 1, 2024. The company has opened a search for Cubel’s
replacement. … Lactalis filed a €1.1 billion claim for damages against lab services provider Eurofins.
Lactalis says that Eurofins incorrectly found that salmonella was
present in the company’s infant formula in 2017, causing a global recall
and shutting down its plant in Craon, France, for nearly a year.
Eurofins called the claim “frivolous.” … Switzerland’s Emmi Group
opened its new cheese conversion and packaging facility in Stoughton,
Wisconsin. The company says the facility helps simplify logistics,
increases efficiency and advances its internal sustainability goals. (USDEC China office; Company reports; Food Safety News, 11/24/23; Boerderij/International-Dairy.com, 11/21/23)
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