MD_DA130

     South America Dairy Market Overview

     Report 7 - Released on February 13, 2020

     During the end of 2019 and the beginning of 2020, the southeast region of Brazil suffered a
     lengthy bout of dry weather, which reduced the volume and quality of fodder in many dairy
     farms. As a result, milk cow production fell considerably during that time. Currently, farm
     milk output in Brazil is steadily recovering as sporadic rains benefited pasture and
     emerging corn in some key dairy basins and crop areas throughout southeastern Brazil. Albeit
     milk production is improving, so far this year, raw milk supply remains short, below levels
     from the previous year. In addition, the slaughter of dairy cows has increased recently due
     to a strong beef cattle market, which is also attributed to the decline in milk production.
     That said, farm gate milk prices are relatively high due to lack of milk supply and strong
     demand among dairy manufacturers.


     In Argentina/Uruguay, the mild weather favored development of corn and soybean crops and
     helped to boost forage quality and volume in several dairy farms. Farm milk production has
     plateaued, but is expected to improve ahead of the fall season. Fat/protein milk components
     remain at low levels, contributing to higher cream premiums paid by buyers. In general
     terms, raw milk intakes are lower in Argentina and Uruguay, but are still adequate to
     fulfill most requests from manufacturers of bottled/UHT milk, cheese, and yogurt. In
     contrast, cream supplies are very tight, while demands from butter churners, ice cream, and
     milk caramel processors continues being strong. Meanwhile, milk requests from bottlers are
     steadily increasing are most schools are reopening in the next few weeks.



     Information for the period February 3 - 14, 2020, issued biweekly

     Published by:
     Dairy Market News - Madison, WI
     ANGEL TERAN-RAMOS, 6084228593
     Email: angel.teran@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