US milk powder exports hit weakest first half since 2017

 US exports of nonfat dry milk and skim milk powder totalled just under 321,700 metric tons in the first half of 2026, down 3% from the same period last year and the weakest first-half performance since 2017, according to the US Dairy Export Council.

Domestic production of the two products slipped to 981,000 MT in 2025, the lowest since 2013, as strong consumer demand for protein pulled skim solids away from dryers toward other uses. Spot prices for US nonfat dry milk reached as high as $2.295 per pound ($5,060 per MT) in May before declining to an average of $1.5675 per pound ($3,456 per MT) in the first week of August.

Mexico, the largest buyer of US milk powder, saw shipments fall 6% in the first half of the year. Central America and the Caribbean were down 21%, South America fell 9% and the Middle East and North Africa declined 55%.

Southeast Asia was an exception, with exports growing 10% in the first half of 2026. The USDEC said long-term pricing contracts, particularly with the Philippines, insulated buyers from the most severe price increases, though exports to the region fell 22% in June when average export values climbed to $3,340 per MT.

Combined production of nonfat dry milk and skim milk powder was up 6.6% year to date, but output fell in both May and June. The USDEC said fundamental supply constraints are likely to persist as consumer demand for protein continues to divert skim solids away from powder production.