The consumption of dairy products has
outstripped production in a number of developing countries over the last
decade. The result has been a marked increase in exports out of the US,
EU-27, New Zealand, and Argentina. But milk production is projected to
hit record levels in 2011, and break that record in 2012.
Is demand growth strong enough in
importing countries to absorb the increased supplies?
How far will prices need to fall to
balance out the global market, and what impact will that have on US
Demand functions are estimated for the
largest importing countries with special attention paid to China.
Baseline supply, demand, and price forecasts are developed for global
dairy prices in 2011 and 2012. Sensitivity analysis is also conducted to
simulate the impact on prices from faster/slower than expected
production or consumption growth.
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