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Education Center

Expertise you won't find anywhere else.

The expertise of the Sergeant Dairy & Proteins team is unmatched, with many team members having earned USDA recognition as experts in the dairy industry. Indeed, the extensive network of dairy insiders and thought leaders surrounding SDP’s Dairy Expert Paul Knox, gives him insight into, and a strong understanding of, market situations and has enabled him to author industry reports and provide customer forecasting for more than a decade. 


On this page, Paul and the rest of the SDP team will offer unique and valuable insights on trends, regulations, and other pertinent topics in and around the dairy industry. These educational articles will be posted below on the first and third week of every month and will be consolidated into a quarterly newsletter that you can subscribe to using the FORM below.

Dairy Market Challenges

Article 5 - February 25, 2022

Every market cycles and this market will too!


Nonfat dry milk is selling at over $2.00/LBS and Whey Protein Isolate is up above $8.00/LBS. We have seen extreme pricing like this in 2007 and again in 2014. The market demands were at record strength, and supply was weak, resulting in record high prices.

There were many economic and market differences between 2007 and 2014 but on both occasions, China was the buyer that drove the demand. After China's demand was met the markets fell. Dairy production continued and as inventories grew prices settled.


In 2021 we faced new economic and market challenges but once again China was the driver of the demand. China imported new record level amounts of dairy trying to replenish their pig farms and giving dairy a marketing boost by suggesting it helped fight covid. It seemed China could not get enough but now China is slowing down as their inventories are high and their economy is slowing down partly due to Covid 19 and Omicron. 

This year, 2022, comes with its own market and economic challenges but it is also the year that China's strong demand will not be around. The question is how much of an impact will the market see without China?


Production is down but it’s down less than 1% so where are the strengths in demand and where are the weaknesses.




Market prices are extremely high, Fuel costs are up, logistics costs are up, labor costs are up, and yet demand remains strong. We need to add in that labor is hard to find, Cow numbers are down, production is down, so supply is softening and Covid continues to play a role in all of this. When we add this up it will result in a drop in demand. Part of what we are seeing in this market is panic buying. The concern that there is a serious shortage and manufactures will be left short. This is a legitimate concern in today’s market but often it leads to over buying and this will slow down as buyers meet their inventory needs.




The new Omicron variant, while not as dangerous as 19, is keeping people on edge and businesses shorthanded. His is happening all around the world. Many people are contracting Omicron and having to stay home to quarantine leaving businesses shorthanded. From farm workers to truck drivers and to Doctors and Nurses their absence hurts and the world economy is slowing down.  




Consumer demands are expected to drop. Inflation is at 7% and possibly rising. The government is no longer feeding money into the economy to help keep it going and with the rise in costs people are not going to be spending like they had in 2021.

World Demands:


While China may not be as strong a buyer this year there are other parts of the world that the US can build export partnerships with especially in SE Asia and the Middle East. Canada is expected to increase its import of Dairy from the US and Mexico will continue to strengthen as well.


The conclusion to all this is confusion! We know that China is not buying as they had, we know that domestic buying will slow down but we don’t know how the export market will do and we don’t know how badly inflation and Omicron will affect markets. We can only pay close attention and draw conclusions as they happen.


We will keep close watch!


On-Demand Webinar - Recorded on December 8, 2021

2021 turned out to be a surprisingly good year for dairy exports. And while this resurgence was due to a return in domestic demand in the wake of a seemingly receding pandemic, we need to consider what may change in 2022:

  • Will exports remain strong?

  • Will milk production continue to increase?

  • Will domestic demand grow?

  • What will happen with feed costs?


Hear Paul Knox, Senior Dairy Expert for Sergeant Dairy & Proteins, host an overview and discussion of what to expect from the dairy industry in 2022.

To view the on-demand recording, click here.

Major World Economies Will Begin to Slow Down in 2022 – Part 1

Article 4 - September 7, 2021

There are several variables that effect the supply and demand of dairy, which in turn create the market situation:

  • World Economies: a strong economy leads to strong demand.

  • World Demand: economies and existing inventories effect a country’s demand. The US exports between 15% - 17% of its dairy production.

  • Weather: temperatures effect a cow’s production, and moisture and heat effect the crops and pastures that feed the cows. Great weather leads to increased supply.

  • Feed Costs: when feed costs are high and demand for dairy is low, farmers can’t afford to feed their entire herd and may decide to cull back their herds.

  • Cow Numbers: the greater the number of cows, the greater the potential for more milk, which leads to higher supply levels.

  • Production Per Cow: milk per cow fluctuates by region, weather, and quality of feed. 

  • World Supply: simple economic theory dictates that too much supply leads to lower prices, and too little leads to higher prices.

  • Dairy Alternative Market: the dairy alternative industry is growing at an annual rate of 10.36%; much faster than the dairy market. Alternative milks, ice creams, yogurt, butter etc. are taking up more space in grocery stores and pushing dairy to the side.

  • Logistics: transportation costs and efficiencies play a role on the supply side. The US exports about 15% - 17% of all its dairy and relies heavily on transportation. 


The summaries above are very simplistic and provide only a high-level understanding of each variable. Following is a more in-depth analysis:


World Economic Growth.

This year’s Post Pandemic economic rebound saw higher than average growth as businesses reopened and consumers stepped out from their covid caves to experience a bit of the life they knew before the pandemic shut everyone in.   

In 2022, world economies are expected to continue to grow, but at a slower pace than in 2021 provided the Delta Variant does not interfere. 


The Top 5 World Economies are:

  1. US

  2. China

  3. Japan

  4. Germany

  5. India


Expected Growth of World Economies based on Gross Domestic Product (GDP):

(Sourced from Goldman / Sachs and


Growth in US:

  • 2021 = 6.6%

  • 2022 = 4.0%

Growth in East Asia (China) and Pacific:

  • 2021 = 7.7% 

  • 2022 = 5.3% 

Growth in Japan:

  • 2021 = 2.6% 

  • 2022 = 2.0% 

Growth in Europe (includes Germany):

  • 2021 = 3.9% 

  • 2022 = 3.9% 

Growth in South Asia (includes India):

  • 2021 = 6.8% 

  • 2022 = 6.8% 


Top 10 US Dairy Export Markets:


  1. Mexico 

  2. Southeast Asia (Philippines, Indonesia, and Malaysia)

  3. Canada

  4. China

  5. South America (Chile)

  6. South Korea

  7. Mena

  8. Japan

  9. Caribbean

  10. Central America

Economic growth will slow but remain strong, and will not be a concern going into 2022. Concerns lie elsewhere in world demand. In 2020 / 2021 exports to China increased 75%, but this is not expected to continue into 2022. We’ll need to rely on increased demand from other export partners in 2022. The next article in this series will discuss the next variable effecting dairy prices: World Demand.

UPDATE! New EU Health Certification Regulations Postponed for US Dairy Products!

Article 3 - August 25, 2021


The European Commission has agreed to postpone its deadline for US dairy products to meet their new health certificate requirements from August 21st to January 15th.


The USDA Agricultural Marketing Services (AMS) and the FDA have been working with the EU Department of Health and Food Safety to find the best ways to meet the new EU requirements. All parties have agreed that the AMS will make minor changes to its current program of review for existing records of milk processing plants or dairy cooperative milk suppliers. Implementing these changes will take time and so this is the reason for the extension.

New EU Health Certification Regulations Threaten US Dairy Exports

Article 2 - August 14, 2021


US Dairy exports to the European Union (EU, now EU-28) average about $100 million annually. And while this figure does not place the EU in the top 10 of US export partners, new regulations that will soon be enacted may threaten these exports.


The regulations proposed by the EU Commission are in many ways similar to FDA regulations in the US, as both are intended to establish and ensure quality standards. Prior to these regulations, and in order to obtain an EU Health Certificate for export to the EU, manufacturers were required to have their final production, blending, and/or packing facility listed on the FDA list of EU-approved facilities.


Additionally, dairy products shipped to the EU required a “letter of conformance” stating that the product met the EU requirements and tested ≤400,000 for Somatic Cell levels. Comparatively, the US permits levels as high as 750,000.


At the end of 2020 however, the EU sent notice of new health certification regulations set to begin on August 21, 2021. These new regulations will make it very difficult for the US to continue to export dairy products to the EU, as they will require farms to receive frequent inspections for signs of Foot and Mouth disease (a severe, highly contagious viral disease of cattle and swine) and Rinderpest (also known as Cattle Plague, a contagious and highly fatal disease of cattle).


Many industry representatives believe that these requirements are highly intrusive and force farmers to share too much information with foreign governments. Case in point is an additional EU requirement that demands new record-keeping systems to store years’ worth of data on the health records and movements of cows.


The new regulations won’t simply affect the direct export of US dairy to the EU, but also the exports of countries that manufacture finished products using US dairy ingredients.  


If the US is unsuccessful in its request to postpone the start date of the new regulations, the demand for US dairy products could drop, and US inventories will be on the rise.

Why Dairy? A Brief History of the Health Benefits of Dairy Products.

Article 1 - August 2, 2021


For thousands of years, humans have been consuming milk and milk-based products. In fact, scientists have ample evidence to suggest that humans began drinking raw milk from animals at least 10,000 years ago, when wild sheep, goats, and Aurochs (Wild Cattle) were first domesticated as a source of food and clothing. And while there is no definitive understanding of how and why primitive people began milking their domesticated animals, the prevailing explanation is to allow them to survive and even thrive in conditions where doing so would have been difficult, if not impossible. In short, dairy equaled health. Dairy equaled life.


Today, while almost universally enjoyed for the flavor and texture they impart to the foods we consume every day, dairy products remain an important part of a healthy, contemporary diet. Indeed, some of the most popular dairy products consumed around the world are Milk, Yogurt, Cheese, Butter, and Ice Cream. And each of these products offer different nutritional and health benefits. 


Fluid Milk: On average, the American consumer drinks 141 lbs. of milk per year. At about 9 lbs. per gallon, that’s almost 16 gallons of milk per year!


Fluid milk is the base for all other dairy products, and alone is a great source of:

  • Protein (whey and Casein)

  • Calcium

  • Vitamin B12 

  • Iodine

  • Magnesium (important for bone development and muscle function)


Yogurt: As of 2020, Americans consumed about 13 lbs. of yogurt per year. At about ½ lb. per cup, that’s 26 cups per year!


Dating back almost as far as the consumption of fluid milk, it is believed that yogurt came about accidentally, as the result of milk naturally souring in warm temperatures. This fermentation (yogurt) was found to be a great way to preserve milk due to the acidity which slows the growth of harmful bacteria. 


It was in the early 20th century when “long healthy life” and yogurt became synonymous, thanks to the probiotic bacteria lactobacilli, which is found in both yogurt and the human gut, and which helps the body break down food, absorb nutrients, and fight off "bad" organisms that could cause diseases.


Yogurts can be high in:

  • Protein

  • Calcium

  • Vitamins

  • Live cultures, or probiotics, which can enhance the gut microbiota. These can offer protection for bones and teeth and help prevent digestive problems. 


Cheese: As of 2019, the average American consumed about 40.4 pounds of cheese per year!

History suggests that the first cheese was made from sheep’s milk around 8000 BC, when sheep were domesticated before bovines and their milk was consumed. In addition to being a source of milk, the sheep’s gut was often used to store and transport the milk and keep it from spoiling in hot weather. The rennet, which is a complex set of enzymes produced in the stomachs of sheep and other ruminant mammals, would curdle the milk to form cheese curds. Over thousands of years, and across different regions of the world, cheese became a part of peoples’ daily diet. Today there are more than 1800 different types of cheese, and each offers unique health benefits. 


Most cheeses are a good source of:

  • Protein

  • Calcium

  • Vitamins – A, B-12

  • Zinc

  • Phosphorus

  • Riboflavin


Some offer additional health benefits that include nutrients to promote gut health, aid in weight loss, improve bone health, and decrease the risk of heart disease.


Butter: As of 2019, the average American consumed 23 sticks of butter per year, or about 6 lbs.! As with other dairy products, butter dates back approximately 8000 years and is made by churning the cream from milk. It is speculated that perhaps milk was being transported on a long journey and was agitated enough to harden into butter. Regardless of how it was first made, butter is a huge part of our lives, adding the following to today’s contemporary diet:  

  • Vitamin D

  • Calcium

  • Vitamin A

  • Vitamin E


Butter is also high in beta-carotene, a compound that the body converts into vitamin A. Beta-carotene has been linked to a lowered risk of lung cancer and prostate cancer.


Ice Cream: The average American consumes approximately 23 pounds of ice cream, and related frozen desserts, per year! The first recorded evidence of frozen treats dates back to Alexander the Great (356 – 323 BC), who was known to enjoy a mix of snow and ice with honey and wine. It is also believed that Caesar enjoyed a concoction of snow mixed with fruits and juices, but it wasn’t until the 16th century that history reports anything close to what we commonly refer to as ice cream. And while it is not known whether it was Europeans or Italians who first made ice cream, we know that it began as a treat for royalty and was only made available to the public at large around 1660. Ice cream first hit America in the early 1700’s and has since become a dairy favorite. Although high in fat, and recommended only to be eaten in moderation, ice cream provide a wide variety of vitamins to the body, including:

  • Vitamin A

  • Vitamin B-6

  • Vitamin B-12

  • Vitamin C

  • Vitamin D

  • Vitamin E 

  • Vitamin K, which prevents blood clotting. 

  • Niacin

  • Thiamine

  • Riboflavin 

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