MD_DA770

     Lactose - Central and Western U.S.

     Report 2 - Released on January 09, 2020

     The lactose price range and bottom of the mostly prices series moved higher, as the top of
     the mostly price series stayed put. Quarter 1 contract agreements are in full effect and
     some market participants think the lactose market may be firming. A few manufacturers
     suggest, in hindsight, they should have pushed for higher quarterly contract prices in
     negotiations last fall. However, other contacts are more cautious. They have concerns that
     the Chinese economy is slow, and if there is another flare up of African swine fever this
     year, the lactose market recovery could falter. Many industry contacts relay the market tone
     may be subdued until after the Chinese New Year and a few initial industry meetings. At that
     point, the dairy industry may be able to better assess market forecasts into 2020. Current
     lactose production is steady and inventories are comfortable.


     DAIRY MARKET NEWS Monthly Averages
     The December 2019 Dairy Market News average of the mostly price series for Central and West
     lactose was $0.2900, compared to $0.2884 in November, and $.3580 one year ago.

     The lactose mostly price series averaged $0.3214 for the year of 2019.
     Prices for: Central and Western U.S., Spot Sales And Up to 3 Month Contracts, F.O.B.,
     Conventional, and Edible Lactose
     Price Range - Non Pharmaceutical; $/LB:                .2400 - .4000
     Mostly Range - Non Pharmaceutical; $/LB:               .2650 - .3300

     Information for the period January 6 - 10, 2020, issued weekly

     Secondary Sourced Information:

     Dairy Products Report – Whey Derivatives Summary
     Released January 6, 2019, by the National Agricultural Statistics Service (NASS),
     Agricultural Statistics Board, United States Department of Agriculture (USDA).

     Selected Whey Derivatives Production – United States
                      Monthly Production (1000 pounds)   Percent Change from
                               Nov        Oct        Nov       Nov      Oct
     Product                  2018       2019       2019      2018     2019
     Lactose, human and animal
                           103,137     96,939     90,206     -12.5     -6.9

     Selected Whey Derivatives – Cumulative Production January - November
                    Cumulative Production (1000 pounds)  Percent Change from
     Product                  2018       2019                 2018
     Lactose, human and animal
                         1,047,894  1,133,153                  8.1
     1. Values are calculated from Dairy Products report data.

     Manufacturers' stocks end of month 2
                      End of month stocks (1000 pounds)  Percent Change from
                               Nov        Oct        Nov       Nov      Oct
     Product                  2018       2019       2019      2018     2019
     Lactose, human and animal
                            88,094    108,523    116,671      32.4      7.5
     2. Stocks held by manufacturers at all points and in transit.


     Global Dairy Trade (GDT) Event
     At the GDT Event 251 on January 7, the lactose price for the March contract period was
     $0.3620 per pound, up 2.1 percent from the last GDT event.


     U.S. Lactose Exports, H.S. Code 1702110000(FAS)
                      2019 Exports      % Change From
                      (Million Lb.)       1 Year Ago
     NOVEMBER Total           56.8           + 31

     TOTAL, JAN-NOV          597.5           - 4
      1 Mexico                97.7           + 16
      2 China                 94.7           - 33
      3 New Zealand           81.9           + 3
      4 Japan                 67.2           - 5
      5 Singapore             34.6           + 7
     Published by:
     Dairy Market News - Madison, WI
     MIKE BANDLI, (608)422-8592
     Email: mike.bandli@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