The numbers for May milk supplies around the world are just coming in now. The trend is upwards, however China looks to be taking more and more dairy product.
The US, New Zealand, Australia and Argentina – four of the big dairy exporters - have all released their milk volumes for May. Now we need to be real on May supply in New Zealand, because what happens in New Zealand in May has little impact, as it’s the last month before drying off cows. It compares to an Irish November, which really means nothing in terms of trade impact, the last month of any reasonable scale in the lactation.
The US, however, is different, as supply is reasonably flat. It was up over 4% while New Zealand was up 7.6% on a volume basis. Australia is up 2.6% and Argentina is up 3.4%. New Zealand will start pumping milk again in August as the North Island calves down.
So, the US is the big one – it hit over 9bn litres during the month, up from 8.6bn litres in May 2020. Cow numbers are up and feed isn’t a problem. This means the US almost produced in one month what Ireland will do in the year. The difference, of course, is all or the majority of our milk is exported off the island, whereas a lot of the US product is consumed in the US.
In the EU, Germany, The Netherlands and Denmark are all on a par with last year for May and June, and France actually looks slightly down. It is noteworthy when the big countries are on par or down.
Ireland, of course, is up, as we published the June results of our survey this week – between 3 and 5% nationally we expect.
In summary, there is more milk in the US, not much more milk in the EU and all signals would suggest New Zealand will get rocking on supply pretty fast, as the milk price forecasts are for a record year on price, so the signs are there to go for it. The saving grace is China, which continues to increase demand, soaking up some of the growth in production.