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Exports of US dairy products to Southeast Asia may increase, if

By on June 24, 2021 0

DENVER, June 24, 2021 (GLOBE NEWSWIRE) – Milk production in the United States continues to grow faster than domestic demand, increasing the need for growth in export markets. And Southeast Asia, with a growing population and growing middle class, remains the biggest growth opportunity for U.S. dairy exporters. However, to match the U.S. milk supply with growing demand in Southeast Asia, U.S. processors will need to invest in manufacturing technology to meet the product needs of an ethnically and economically diverse consumer base.

Rapid urbanization across Southeast Asia has increased per capita incomes and will lead to increased protein consumption as consumers seek healthier foods and drinks, according to a new report from CoBank’s Knowledge Exchange. , including a range of dairy products and ingredients.

“Cultural and economic diversity across Southeast Asia means that US processors must offer a diverse product line to be competitive,” said Tanner Ehmke, chief dairy economist at CoBank. “In the skimmed milk powder (SMP) market which accounts for the bulk of dairy imports in Southeast Asia, processors need to offer low-temperature SMP at a lower price for millions of low-income consumers. . At the same time, processors need to offer medium and high heat SMP to high income consumers who want more digestible and soluble products.

Whey products exported to the region must also meet the diverse needs of consumers with varying prices. Whey permeate powder is primarily used as a feed additive to fortify pig rations, with demand increasing as the region’s pig herd recovers from African swine fever. But as wealthier consumers increasingly desire protein drinks and sports products for babies and toddlers, the demand for whey protein concentrate will continue to rise.

With much of Southeast Asia lacking a refrigerated supply chain and consumables frequently sold through outdoor vending machines, products containing dairy products must be heat stable. The powdered ingredients should also be completely soluble so that the solids do not settle in the container over time. US processors will need to ensure that they are versatile enough to meet these needs in order to take full advantage of the opportunities in the Southeast Asian market.

As Southeast Asia promises greater export opportunities in the future, the US dairy sector needs trade liberalization in order to take full advantage of growth. U.S. dairy prices are often lower than other exporters to Southeast Asia, in part to overcome tariff barriers with some countries. However, other major dairy exporters like Oceania and Europe are facing headwinds in production, potentially allowing the United States to gain market share.

Read the report, U.S. dairy processors must be versatile to compete in Southeast Asia.

About CoBank

CoBank is a $ 160 billion cooperative bank serving vital industries across rural America. The bank provides loans, leases, export finance and other financial services to agribusinesses and rural electricity, water and communications providers in all 50 states. The bank also provides wholesale loans and other financial services to affiliated farm credit associations serving more than 75,000 farmers, ranchers and other rural borrowers in 23 states nationwide.

CoBank is a member of the Farm Credit System, a national network of retail banks and credit associations licensed to serve the borrowing needs of agriculture, rural infrastructure, and rural communities in the United States. Based outside of Denver, Colorado, CoBank serves clients in regional banking centers across the United States and has an international representative office in Singapore.


        


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