A weakened Euro has made European goods cheaper but, perhaps more important, a new free trade deal agreed between the European Union and Mexico has diminished the U.S. processors are having to adjust contractual prices downward in order to retain buyers, while some Mexican buyers are cancelling their contracts altogether.įurthermore, increasing European exports are attracting demand away from U.S. The tariffs came into fruition on July 5 and triggered a 25% duty on fresh cheese and a 20% duty on all other types. exported $391 million worth of cheese into Mexico. tariffs on Mexican steel and aluminium by implementing duties of their own on a list of U.S. Mexico, the U.S.’s largest market for cheese, consuming 28% of exports, have retaliated to U.S. has encountered similar cheese surpluses in the past, but with global trade tensions rising amidst the Trump administration’s protectionist tariff policy, there are concerns over demand for U.S. As a result, prices in July are down 22% compared with a year ago. To put this into perspective, that’s just over 900,000 cubic yards of cheese. Ultimately, in this bid to avoid losses, 1.39 billion pounds of cheese have been accumulated in cold storage. The increased milk production has led processors to churn their milk into cheese so that it can be stored for longer. Milk producers in the Northeast, Midwest and Mountain states have benefitted from reasonable precipitation and warm temperatures since April to maintain healthy pastures and keep cows outside longer. have added their share to the sinking cheese prices.įavorable weather and pasture conditions, as well as the seasonally high production rates of the spring flush this year, have led to the current milk glut in the U.S. This time round, trade tensions and rising European exports to a vast milk glut in the U.S. cheese prices in April 2017, when good pasture conditions and a healthy dairy herd had encouraged high production from cheese manufacturers, bursting the cheese price bubble. The current stockpile of cheese is the largest since records began in 1917. Cheddar barrel prices are currently at their lowest levels since 2010, with 1.39 billion pounds of cheese stored in U.S. is once again experiencing an oversupply of dairy. Spend Matters welcomes this guest post from George Duke, analyst at Mintec.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |