Chinese WMP Imports Soar
March 22, 2022
The Year of the Tiger got off to a roaring start at Chinese ports, where merchants imported whole milk powder (WMP) ata breakneck pace. China imported 662 million pounds of WMP in January and February, the highest two-month total ever and an astounding 24.8% more than the record-high volumes of the first two months in 2021. Chinese skim milk powder (SMP) imports fell 12.6% short of prior-year levels in January and February, but they were still historically high. Typically, Chinese WMP imports are three to four times as large as Chinese SMP imports, and Chinese milk powder imports consistently dwarf its purchases of other dairy products. China’s massive imports of WMP signal that the world’s largest dairy importer remains hungry for foreign products, assuaging — or at least delaying — concerns that Chinese demand will suddenly drop off due to large on-hand stockpiles.
Similar to SMP, Chinese imports of ultra- high temperature (UHT) fresh milk, butter,
and cheese failed to top the record-setting volumes of the first two months of 2021. But excluding last year China imported more cheese and UHT milk in January and February than in all other years. Chinese butter imports were higher than every January and February except 2020 and 2021. Chinese consumers have continued to enjoy these imported dairy products in healthy, but not growing, volumes.
In contrast, China’s whey imports disappointed. The country imported 153
million pounds of whey powder in January and February, the lowest volume since 2016 and 45% less than in the first two months of 2021. China’s pork sector has largely recovered from the devastation wrought by African swine fever, and pork prices have fallen as supplies have climbed. Amid higher feed costs and falling profit margins, Chinese hog growers were less inclined to pay up for whey. But in the absence of cheaper alternatives, they could step back into the market if whey prices were to wane.