Despite the challenging trade environment, the United States dairy industry is “keeping its head above water,” according to Gregg Doud. Exports are improving, although “we are struggling a bit with food service demand.”
No one is better positioned to view the current state of the dairy industry. Doud currently serves as the National Milk Producers Federation’s president and CEO. Before that, he served as the chief agricultural negotiator in the Office of the United States Trade Delegation, negotiating access to U.S. dairy with Canada in a dispute that goes back years.
Doud has previously served as the president of the Commodity Markets Council, as a staff member for the United States Senate Committee on Agriculture, Nutrition and Forestry and as chief economist for the National Cattlemen’s Beef Association. Pictured above is a glass and pitcher of milk: congerdesign. Photo courtesy of Pixabay.
Positive export picture
Doud told High Plains Journal about 16 to 18% of U.S. dairy production is exported, much of it in the form of cheese, and exports are increasing over time. They are up this year by 14% overall. But it’s the increases to particular markets that are striking: up by 15% to Mexico, and by 34% to Canada (traditionally the two largest markets for U.S. dairy). The 2024 value of U.S. dairy exports to Mexico amounted to a record $2.47 billion, with cheese shipments a big driver of that total. Mexico is traditionally the top export destination for U.S. dairy products.
Canada, the No. 2 market, imported $1.14 billion worth of U.S. dairy products in 2024, a record high. Doud was the chief U.S. negotiator with Canada over Canadian barriers to U.S. dairy exports during the first Trump administration, and says progress was made in opening up Canada’s dairy markets, although “more work needs to be done.”
Other major countries include China, which imported $548 million worth of U.S. dairy, South Korea, $385.66 million, and Japan, $394.61 million.
U.S. growth
Doud said the U.S. is about the only dairy producer and exporter where production is growing, while it is flat or declining in other dairy-exporting competitors. He attributes that growth not to any increase in the U.S. herd sizes—which have remained flat—but to increased production and to $10 billion of new investment in dairy processing capacity in the U.S.
“New Zealand production is maxed out, Australian dairy production is maxed out, mostly because they have already used up the parts of the country suitable for dairy production. European production is somewhat in decline. The U.S. is the only growth area.”
The decline in the value of dollar helps U.S. exports too, Doud acknowledges. But barriers remain. “We import $3 billion in dairy products from the EU each year, but only export $167 million worth. We export more cheese to New Zealand than to all of the EU.”
Whole milk: Back in school lunches?
Domestically, Doud is concentrating on the “Whole Milk For Healthy Kids Act,” which is scheduled for a Senate committee hearing the first week of June. It would re-introduce whole milk to school cafeterias as a choice along with 2% milk, 15 years after the “Healthy, Hunger-Free Kids Act” of 2010–famously supported by then First Lady Michelle Obama–rejected it from school lunches when concern over childhood obesity was focused on fats in milk.
Science has adjusted the findings since then. A 2018 study in the medical journal The Lancet involving more than 130,000 people found that full-fat dairy consumption was linked to lower mortality and cardiovascular disease rates compared to low-fat alternatives. Whole milk is no longer regarded as a risk factor for diabetes and there are some indications it might help prevent it. Whole milk for children is mentioned positively in the recent “Make America Healthy Again” report, and Doud is plowing through its 370 footnotes.
Federal dietary guidelines have not yet caught up with the latest science, though, still recommending low-fat 1% milk for young schoolchildren. This provided cover for the 99 members of Congress who voted against the milk bill the last time it came up, as opposed to the 330 who voted for it.
“It would be great to have this signed into law before school starts,” Doud said.
But it would still take some time for dairy producers to see the effects; procurement for schools happens at the state and local level.
David Murray can be reached at [email protected].
