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DBweekly Bill Baker | DairyBusiness Radio LEVITT: EXPORT MARKET SUPPORTING DOMESTIC PRICES DAIRY TRADE OUTLOOK REMAINS STRONG By Bill Baker It’s hard to see world dairy prices falling anytime soon, according to Alan Levitt with the U.S. Dairy Export Council. DairyLine Radio (DLR): Alan, how important has the world market been in supporting the U.S. market in 2013? Levitt: The U.S. all-milk price has been between $19 and $20 every month this year and that’s actually pretty remarkable. The milk price this year is going to be the second highest ever – just a little shy of the 2011 record. I think this is even more remarkable (because) it is taking place in a period where domestic consumption has actually been pretty sluggish and our inventories have grown. DLR: You reported that the real difference maker this year has been the strength of the global markets and also the way U.S. suppliers have been committed to exports. Levitt: To put that into context, the first half of the year, we exported 14.7% of our milk production on a total solids basis. That’s a record. We sold half of our milk powder, nearly 6% of our cheese and 7% of our butter overseas. Those sales have been critical to help clear the domestic market and keep supplies more balanced at home. DLR: That’s great news, but are we gaining share at all? Levitt: Yes, from a business standpoint the 9 good news is we have gained share against all of our major competitors this year. In the first half of the year, U.S. share of exports – milk, powder, cheese, butterfat and whey, from the top nine exporters in the world was 18.4%. So, we’ve picked up a couple points of share (from last year). New Zealand gained a half-point because they had some heavy shipments earlier in the year. The EU has lost share for the “The outlook is for continued tight supplies and strong global prices, at least through the end of the year. That, in turn, is going to support U.S. prices, and that’s going to be beneficial for U.S. dairy farmers.” -- Alan Levitt, U.S. Dairy Export Council third straight year. Australia, Argentina and Ukraine have also declined, so we’ve been able to pick up a little bit there. DLR: What’s the outlook? Levitt: I think the outlook looks really good for the rest of the year, maybe even into DAIRYBUSINESS RADIO PODCASTS: Liquidity is Important Now – Gary Sipiorski, Vita Plus NASS Milk Production Surveys Coming Back – Chris Galen, NMPF Short-Term Farm Bill Extension is Possible – Jerry Slominski, IDFA Net Farm Income Up Six Percent – Tom Vilsack, Ag Secretary Youth Spotlight – Mieke DeJong from Bonanza, Oregon
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