Market Watch Diary: Domestic Sales Support Milk Price

September 30, 2015 01:41 AM

Dairy product sales continue their historical growth pattern in the U.S., which is good news for milk prices.
USDA recently released per capita consumption data through the first seven months of 2015. Let’s take a look at the key domestic dairy products to see how much more or less consumers are eating and drinking.

First up, beverage milk. A few months ago, I wrote about the resurgence in whole milk sales. Whole milk sales were up 3.8%, or 28 million gallons, in the first seven months of 2015 compared to the same time period in 2014.

On the flip side, the “milk for drinking” category can’t seem to gain traction. Total beverage milk sales at retail were down 2.3% (56 million gallons) in 2015 versus 2014.

During the same seven-month period, USDA reports total milk sales were 1.6% lower  this year, but conventional whole milk sales were up 3.6%. Organic whole milk sales were up 11% January through July 2015.

Meanwhile, the cheese business remains full-speed ahead. Retail sales of natural cheese were up 3.4% during the first seven months of this year, and sales to the restaurant business are booming as well. Most notably, fast food sales, the cheese-friendly side of the foodservice business, have been up double-digits versus one year ago.

Per capita dairy product sales are in growth mode this year—just like 2014.

Every man, woman and child consumed an average 33.9 lb. of cheese in 2014. This is a year-over-year increase of 1.4%—or half a pound. Remember, this data doesn’t include exports. Americans have a growing appetite for cheese.

Per capita butter sales were unchanged in 2014, at 5.5 lb., which ranks the highest since 1975, according to my records. For the past 10 years, the average has been 5.1 lb. Yogurt per capita was flat, but at a record high for the second year.


All told, per capita consumption of all milk and dairy products was equivalent to 614 lb. of milk. That’s another record for dairy sales in the U.S. When the 2015 sales are released, I expect that number to be even higher.

This all helps explain why your milk price isn’t a repeat of 2009.

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