• USDEC makes case to UK trade minister for tariff cuts  

• Congress advances increased funding for Federal Maritime Commission 

• Hollister honored with induction into prestigious cheese organization

• Video: Farmers offer their praises of the value of the U.S. CDE in Singapore

• FAS interns learn about USDEC and the dairy industry 

• Market Summary: GDT slides further 

• Brazilian food and beverage companies learn more about U.S. dairy ingredients

• Qatar begins strictly enforcing palletization requirement

• Transfer of Japan food safety standard setting function from MHLW to the CAA

• USDEC welcomes ByHeart as new member

• LinkedIn passes the 6,000-follower threshold

• Company News: Hilmar, Danone, Megmilk Snow Brand 

 

USDEC makes case to UK trade minister for tariff cuts 
On Wednesday, the USDEC Trade Policy team met virtually with UK Minister of State at the Department for Business and Trade Nigel Huddleston to make the case for reduced tariffs on U.S. dairy products.

The meeting follows a USDEC and NMPF petition for the UK government to unilaterally lower its World Trade Organization Most Favored Nation (MFN) tariffs on a slate of dairy tariff lines. USDEC’s case for tariff liberalization centers upon the tariff disparity that U.S. dairy exporters face in the post-Brexit UK market, particularly as trade deals with the European Union (EU), New Zealand and Australia provide preferential access to their exporters.

The European Union currently supplies 99% of UK dairy imports thanks to duty-free access as part of the UK-EU Trade Cooperation Agreement.

An MFN tariff reduction would help U.S. exporters gain competitiveness with EU imports, providing greater sourcing options for importers and increased variety for UK consumers. The tariff reduction would also help reduce food inflation in the United Kingdom and provide longer-term price resilience by allowing companies to diversify their supply chains.

Congress advances increased funding for Federal Maritime Commission
Both the House and Senate committees on Appropriations passed their funding bills for Transportation, Housing, and Urban Development, and Related Agencies (THUD), one of a dozen such bills that make up the annual government funding process. Included in the THUD bills is funding for the Federal Maritime Commission (FMC), which regulates the U.S. international ocean transportation system and oversees the implementation process of the Ocean Shipping Reform Act (OSRA). This year, both the House and Senate versions of the bill provide $43.7 million for the FMC, fully funding the President's Budget Request.  

The funding increase follows a USDEC- and NMPF-organized agricultural association letter to leadership of the Transportation Subcommittees of the House and Senate Appropriations Committees in May, calling on Congress to support the President’s 2024 budget request for the FMC. The proposed 14.25% increase to $43.7 million would allow the commission to hire much-needed new staff and ensure that the FMC could fully and effectively implement OSRA and related rulemaking. 

 

This comes as other programs within the transportation bills saw significant cuts. Both bills still need to pass on the floor of their respective chambers and may do so on their own or as part of a larger omnibus bill. 

Hollister honored with induction into prestigious cheese organization
USDEC Senior Vice President, Global Cheese Marketing Angélique Hollister was inducted into the prestigious New World Chapter of the Guilde Internationale des Fromagers during a ceremony at The French Cheese Board in New York City on June 26.

Hollister was recognized as a “Garde et Juré,” which means being a protector of the craft of cheesemaking and ensuring the economic health and viability of the industry globally.

“Having dedicated over 23 years to working for the industry, it is a great honor for me to be accepted within this incredible group of passionate and dedicated people who do their best every day to make a difference for the cheese industry,” said Hollister.

 

Ambassadors of the Guilde Internationale des Fromagers donned ceremonial robes to honor Hollister with the esteemed title of “Garde et Juré,” protector of the craft of cheesemaking. 

What is the Guilde?
The Guilde Internationale des Fromagers is a global non-profit organization established in Europe in 1969 by noted French cheese expert Pierre Androuet to promote and connect the work of cheese professionals around the world while also helping to maintain standards of cheese knowledge. The New World Chapter was formed in 2012 and recognizes artisanal cheesemakers, mongers and other cheese professionals from the United States, Australia, Canada and Mexico.

The Guilde is an exclusive organization, recognizing those who have devoted their lives to protecting and advancing the cause of cheese around the world.

New inductees require nomination by a sitting member and approval by the organization’s board. Sheri Allen, a Certified Cheese Professional and Certified Cheese Sensory Evaluator through the American Cheese Society, nominated Hollister. Allen cited Hollister’s passion for U.S. cheeses and her lifelong dedication to increasing demand for cheeses from the USA in overseas markets.

“Angélique’s dedicated work for the past 23 years has contributed greatly to elevating the global profile of the U.S. cheese industry,” said Allen, who was inducted into the Guilde herself in 2017.

Hollister’s recognition also contributes to the growing positive awareness and reputation of U.S. cheeses. In addition, it further reinforces the credibility of USDEC’s mission and its cheese educational marketing programs.

Video: Farmers offer their praises of the value of the U.S. CDE in Singapore
During last month’s farmer mission to Singapore (see 6/9/23 and 6/16/23), USDEC sat down with the seven farmers who participated and asked for their impressions of the U.S. Center for Dairy Excellence (U.S. CDE). Their responses are captured here on video, along with those of Corey Geiger, managing editor of Hoard’s Dairyman magazine (who accompanied the trip), and Dali Ghazalay, USDEC regional director in Southeast Asia.

Everyone gave the U.S. CDE glowing reviews. Here is what Minnesota dairy farmer Charles Krause had to say:

“Coming to the Center for Dairy Excellence really opened my eyes to see the innovation we’re using, the way we are dealing with customers in Southeast Asia—and making that connection. We can have a great product, but if we don’t have a personal connection—a human-to-human contact—that great product means nothing. When customers know that family farms like mine are producing a great product from the United States that can be trusted, it’s sustainable, it’s nutritious and it’s produced with the utmost heartfelt love into what we do, it’s important to that customer. And the people who work for us here in Singapore at the Center for Dairy Excellence are the ones who are getting that word across for us.”

The video was presented this Wednesday at the Dairy Management Inc. board meeting in Chicago, where the farmer mission participants also shared, in person, their positive impressions and key learnings from the trip about the U.S. CDE and what USDEC is doing to seize export growth opportunities at the U.S. CDE and more broadly in Southeast Asia as well as Japan and Korea.

Also at the DMI meeting in both the general session and Export Committee meeting, USDEC CEO Krysta Harden and COO Martha Scott Poindexter discussed the export market situation and performance year to date in 2023, including some of the economic factors contributing to dampened demand for U.S. dairy so far this year. They also commented on the close collaboration and coordination with DMI on international and export-related areas.  

Harden also relayed strong thanks to Larry Hancock for his service and contributions as USDEC chair. Hancock has announced he will be stepping down as chairman to pursue other opportunities.

FAS interns learn about USDEC and the dairy industry
USDEC continues to strengthen its engagement with the USDA’s Foreign Agricultural Service (FAS). On Tuesday, USDEC hosted six FAS interns and staff for a briefing on the services it provides to the U.S. dairy industry – and why exports are so essential.

Six interns and staff from USDA’s Foreign Agricultural Service visited the USDEC office on Tuesday. They met with USDEC Executive Vice President, Policy Development and Strategy Jaime Castaneda, far left; Trade Policy Manager Tony Rice, second from left, and Senior Vice President, Trade Policy Shawna Morris, far right.

FAS and its attachés have long been key USDEC partners in the effort to build U.S. dairy export markets. USDEC’s ongoing engagement seeks to deepen the relationships with those representatives and develop their knowledge of U.S. dairy so they can be even better advocates for the industry.

GDT slides further
Contrasting the recent improvement in dairy product prices at the CME, the Global Dairy Trade (GDT) price index declined again on Tuesday, falling 1.0% compared to the prior event.

North Asian activity, which acts as a proxy for Chinese purchases, was particularly quiet at this week’s auction – a worrying signal for global dairy demand. North Asian purchases were less than last year’s low levels for anhydrous milkfat (AMF), butter and whole milk powder (WMP).

In tandem with weaker Chinese activity, the average winning bid for WMP dropped by 1.5% to $3,100/MT and butter by 2.7% to $4,705/MT. Surprisingly, despite a decline in Chinese activity, AMF was the only product to see an improvement, climbing 3.4% to an average winning bid of $4,745/MT with improvement across most delivery periods.

With North Asia slightly more engaged on SMP, the price decline was more modest, just -0.9% to $2,503/MT. Still, it was cheddar cheese that experienced the largest decline, falling 10.1% to $3,955/MT, to come more in line with international prices, though the GDT value still sits above U.S. spot cheddar prices.

Looking ahead, North Asia’s lack of activity on the GDT paints a troublesome picture for Chinese WMP demand as we move into the second half of the year. Naturally, buyers could have been active off-auction, but with WMP trade to the country just beginning to stabilize, recent GDT auctions suggest we shouldn’t anticipate a dramatic rebound in the country’s WMP imports in the near future.

Brazilian food and beverage companies learn more about U.S. dairy ingredients
On Monday, USDEC Vice President of Global Ingredients Marketing Terri Rexroat met with 16 representatives from 11 Brazilian food and beverage companies, providing an overview of USDEC and its ingredients marketing program.

The representatives were in Chicago attending the IFT FIRST Annual Event and Expo as part of a USDA Foreign Ag Service reverse trade mission. Most were buyers or general management representing sports nutrition companies, as well as food ingredient importers and distributors. Some already work with USDEC members and use U.S. dairy ingredients, but others were less familiar. All were interested in expanding their knowledge of U.S. dairy ingredients and identifying new U.S. dairy ingredient suppliers. 

USDEC’s Terri Rexroat, far left, met this week with representatives of 11 Brazilian food and beverage companies.

Qatar begins strictly enforcing palletization requirement
Qatar’s government has begun strictly enforcing its palletization requirement on imported goods and is fining companies found to not be in compliance. Effective immediately, importers face penalties of 1,000 QAR (around $275) per 20 ft container and 3,000 QAR (around $824) per 40 ft container for products arriving unpalletized. Contact Bryan Jacoby, bjacoby@usdec.org, if you have questions.

Transfer of Japan food safety standard setting function from MHLW to the CAA 
Effective April 1, 2024, the responsibility for establishing standards and criteria for food safety in Japan, currently under the Ministry of Health, Labor and Welfare (MHLW), will be transferred to the Consumer Affairs Agency (CAA), which currently oversees food labeling policies and fair trade. MHLW ensures that the process of setting science-based standards, such as establishing maximum residue limits (MRLs), will continue to be transparent and aligned with international standards, specifically with CODEX.

The purpose of this move is to facilitate the timely incorporation of discussions on standards and criteria formulation to address commercial and consumer needs. However, concerns have been raised that this change may create an opportunity for consumer interest groups to interfere with the food safety system.

On a recent trip to Japan, USDEC’s Jonathan Gardner, senior vice-president of market access and regulatory affairs, and Edward Fetzer, vice-president of market access and regulatory affairs, met with government officials from MHLW, in which they stated that the Government of Japan will maintain its robust and transparent food safety regime based on science. USDEC/MARA is monitoring the situation and will be tracking any developments once the new office opens next spring. 
 

USDEC welcomes ByHeart as new member
ByHeart, an infant formula company based in New York, N.Y., has been approved for USDEC membership.

LinkedIn passes the 6,000-follower threshold
Lots of people are choosing to follow USDEC’s LinkedIn page. The total now exceeds 6,000 – with nearly 2,000 of those coming in the past 12 months.

And the quality of our followers is even more impressive than the quantity.

If you haven’t already become a follower, please do so. It will help keep you informed of the many things USDEC is doing to accelerate U.S. dairy exports.

Hilmar rebrands, integrating its two businesses
Hilmar Cheese Company has revealed a new look and corporate strategy, unifying its products under the brand name Hilmar while marking the integration of the company’s cheese and ingredients businesses.

A news release explains that the new logomark features a milk droplet that’s being split into two products: cheese and whey ingredients. The design also reflects the concepts of nature, farmland and sustainability.

“We take our role as stewards of the land and environment seriously,” said David Ahlem, Hilmar’s president and chief executive officer.

Ahlem also said. “This new brand reflects our commitment to investing in technologies and processes that reduce our carbon footprint and make efficient use of all our resources.”

“The new identity aligns with the company’s expanding role in the markets it serves,” said Ahlem. (Dairy Processing, Turlock Journal, 7/14/23)

Russia seizes control of Danone operations
Russia has taken control of the Russian subsidiary of French dairy group Danone, reports BBC News.

The units have been put in “temporary management” of the state, under a new order signed by Russian President Vladimir Putin.

Danone was in the process of selling its Russian operations.

Reuters reported on Monday that Danone is reviewing its legal options. (BBC News, 7/16/23; Reuters, 7/17/23)

Japan dairy companies bet on Asia exports as demand slows at home
Japanese milk producers Megmilk Snow Brand and Yotsuba Milk Products will expand dairy exports to Asian markets to secure new revenue streams as price hikes dent demand at home, reports this article by Nikkei Asia, a Japanese weekly news magazine.

Megmilk will soon start exporting its "Hokkaido" brand long-life milk to Thailand. It already ships the product to Singapore, Taiwan, Hong Kong and Palau.

Meanwhile, Yotsuba Milk Products plans to lift exports to Singapore by value by 20% every year. Milk packaged at its main factory in Hokkaido will be shipped to Taiwan, Malaysia and other markets. (Nikkei Asia, 7/18/23)

Company news briefs
Denmark’s Arla Foods is teaming up with Blue Ocean Closures in a formal partnership to create a fiber-based cap for its milk products. This could be a first in the dairy industry and reduce Arla’s plastic consumption by more than 500 tons annually if implemented … Darigold has joined the Global Dairy Trade platform to better support its growth ambitions and create value for its farmer-owners … China’s Mengniu Dairy has been named an official sponsor of the FIFA Women’s World Cup 2023, which began on Thursday … Nestlé has introduced a new sugar-reduction technology, which uses an enzymatic process that can reduce intrinsic sugar in ingredients such as milk, malt and fruit juices by up to 20% ...  China’s Shanghai Youchun Dairy signed a cooperative agreement to build a dairy processing project in Jinchang city in Gansu province capable of producing of 200,000 MTs of dairy products per annum … Seven-Eleven Japan Co. said it will launch a new brand of environmentally friendly prepared foods. The company will start selling the first four items of the brand this week. The items include a tuna mayonnaise "onigiri" rice ball whose tuna is partly replaced by pea protein. (Perishable News.com, 7/14/23; Dairy Reporter, 7/11/23; Sports Mint, 7/17/23; FoodBev Media, 7/1/23; USDEC China Office, 7/18/23; Jiji Press, 7/11/23)