MD_DA130 South America Dairy Market Overview Report 23 - Released on June 8, 2023 Weather has improved throughout the dairy concentrated areas in the Southern Cone region. Rainfall, which was detrimentally low for as long as three years, has been more regularly reported by contacts in the area since April/May. Soil health, crop expectations, and subsequently milk production have all shown some marked improvements. Lingering effects from the drought are still expected to keep markets in flux, though, as recent crop exports have been clearly hampered for two strong global crop exporters, Argentina and Uruguay. Prices at the retail level have corrected lower, but reports suggest customers are opting for lower- cost alternatives. Brazil continues to be the primary destination for dairy commodities from its South American neighboring countries. Skim milk powder, whole milk powder, and cheese have all been steadily moving into the largest continental neighbor. That said, as has been recently reported, Brazilian purchasing has slowed down from its late 2022 and Q1 2023 pushes. Commodity prices, which have held steady on the continent, particularly compared to global competitors, have started to ease lower, and there are more bearish pricing expectations reported from contacts than bullish, due at least in part to increasing milk output expectations. Information for the period May 29 - June 9, 2023, issued biweekly Published by: Dairy Market News - Madison, WI ISRAEL WEBER, 608-422-8601 Email: israel.weber@usda.gov Additional Dairy Market News Information: Dairy Market News (DMN) by Phone: (608)422-8602 DMN Website: https://www.ams.usda.gov/market-news/dairy DMN MARS (My Market News): https://mymarketnews.ams.usda.gov