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Documentation

Scope

The data set currently contains 11 files describing various facets of the U.S. dairy industry.  All of the files include data compiled from a variety of sources including USDA agencies and individual States.  Three of the files contain monthly data, one contains quarterly data, and the remaining seven contain annual data.

Sources

The primary sources of data for the tables:

 

Calculating commercial disappearance of dairy product categories 

ERS provides commercial disappearance tables for four product categories: butter, nonfat dry milk, American cheese, and other-than-American cheese. Commercial disappearance tables include total commercial disappearance, domestic commercial disappearance, and the elements that go into calculating commercial disappearance numbers. Monthly data are provided from 1995 to the present. 

 Relationships are expressed in the following equations:  

  • Total commercial supply = beginning commercial stocks + production + imports 
  • Net Government removals[1] = price support purchases through the Dairy Products Price Support Program + exports    under the Dairy Export Incentive Program – unrestricted sales of Government stocks 
  •  Total commercial disappearance = total commercial supply – net Government removals – commercial ending stocks 
  •  Domestic commercial disappearance = total commercial disappearance – commercial exports 

Data sources, commercial disappearance for product categories
Commercial disappearance elementSource
Commercial stocks 1 USDA National Agriculture Statistics Service; USDA Farm Service Agency
Production USDA National Agriculture Statistics Service
Imports U.S. Department of Commerce, Census Bureau
USDA net government removals:  
    Price support purchases and
    unrestricted sales
USDA Farm Service Agency
    Dairy export incentive exports USDA Foreign Agriculture Service
Commercial exports 2 U.S. Department of Commerce, Census Bureau; USDA Foreign Agriculture Service
1 Government stocks are subtracted from total stocks to calculate commercial stocks. NASS reported government stocks through 2007, but has since not published government stock data. A large percentage of government stocks were held by USDA Commodity Credit Corporation (CCC). After 2007, CCC stocks were subtracted from total stocks to estimate commercial stocks.
2 Commercial exports are distinguished from government exports, which include exports that received bonuses under the Dairy Export Incentive Program and foreign donations of government products.

                

 Import and export codes used for commercial disappearance product categories  

The source for dairy trade data is the U.S. Department of Commerce, Bureau of the Census. U.S. Census Bureau data are compiled using a commodity classification system developed by the World Customs Organization: the Harmonized Commodity Description and Coding System, or simply the Harmonized System (HS). The Harmonized System is an international standard for recording world trade at 2-digit, 4-digit, and 6-digit levels of detail. The United States adopted a 10-digit code system to include greater product detail and began using it for U.S. trade on January 1, 1989. Codes used for U.S. exports are provided in the U.S. Census Bureau Schedule B.  Codes used for U.S. imports are provided in the Harmonized Tariff Schedule of the United States (HTS), administered by the U.S. International Trade Commission (USITC).  U.S. Census Bureau data for dairy products are reported in kilograms of product weight or liters of product volume.  Since ERS commercial disappearance data are reported in pounds, data for imports and exports must be converted to product weight in pounds. 

 For an Excel workbook displaying import HTS numbers used for each product category, click here.  Descriptions listed are those provided by the USITC Interactive Tariff and Trade DataWeb.[2] 

For an Excel workbook displaying Schedule B export codes used for each product category, click here.  Export classification in Schedule B is not nearly as detailed as import classification in the HTS.  Note that the distinction between American and other-than-American cheese is not precise.  We have categorized HS codes according to what we believe are the predominant varieties of cheeses within each HS classification.  For example, we make a simplifying assumption that all processed cheese exported is of an American type. 

Calculating commercial disappearance of milk in all products                                                      

Four tables are provided for commercial disappearance of milk in all dairy products: 

  • Milk-equivalent milk-fat basis
  • Milk-equivalent skim-solids basis
  • Milk fat
  • Skim solids 

Calculation of estimated commercial disappearance of milk in all products is very similar to the calculation for product categories.  An exception is the deduction of farm use to estimate milk marketings.  

Milk marketings = Milk production – farm use 

Total commercial supply = Beginning commercial stocks + milk marketings + imports 

NASS publishes farm use data on an annual basis.  To estimate monthly farm use of milk, ERS prorates the annual number grounded on the number of days in each month.  For each month in the current year, ERS assumes that farm use is equal to the estimated monthly farm use from the previous year. 

Milk is made up of water, milk fat, and skim solids (protein, lactose, ash, and trace elements). Milk equivalents are measured on both a milk-fat basis and a skim-solids basis. The milk-fat and skim-solids content of milk varies from year to year, month to month, cattle breed to cattle breed, and even cow to cow.  Most farm milk in the United States averages about 87.5 percent water, 8.8 percent skim solids, and 3.7 percent milk fat. 

To account for the supply and use of milk in all products, it is necessary to either account for the equivalent amount of milk or milk solids associated with commercial stocks, imports, exports, and net Government removals of the products.  Conversion factors associated with milk fat and skim solids are used for this accounting. 

 

 Conversion factors for commercial stocks and net Government removals  

The table below lists factors used for converting commercial stocks and Government removals to milk equivalent or milk solids percentages. For example, it takes about 9.23 pounds of farm milk to make 1 pound of American cheese, measured on a milk-fat milk-equivalent basis. It takes about 9.9 pounds of farm milk to make 1 pound of American cheese, measured on a skim-solids milk-equivalent basis. Milk solids conversion factors reflect solids required for production rather than percentages of solids in the final product. American cheese conversion factors for milk fat (33.9 percent) and skim solids (85.1 percent) exceed 100 percent of the product volume as some solids become whey byproduct or are not retained. 

 

Data sources, commercial disappearance for product categories
ProductMilk equivalent1Milk solids percentages2
Milk Fat basisSkim solids basisMilk fatSkim solids
Butter 21.80 0.12 80.0 1.0
American cheese 9.23 9.90 33.9 85.1
Other-than-American cheese 7.49 9.99 27.5 85.9
Dry whole milk 7.36 8.26 26.5 71.0
Nonfat dry milk 0.22 11.58 0.8 99.6
1Factors for obtaining farm milk equivalent on milkfast and skim solids basis. Source: USDA Economic Research Service. Weights, Measures, and conversion Factors for Agricultural commodities and Their Products (1992).
2Reflects solids required for production, not the actual precentage in the final product.

 Note that stock data for only some major product categories are used in the calculations. For products not included in the stock data for the commercial disappearance (ice cream, for example), the implied assumption is that these products are consumed in the same period that they are produced. 

 

 Conversion Factors for Trade Data 

 For imports and exports, milk-fat and skim-solids percentages are estimated for each HS code, based upon information from several sources. To estimate the farm milk equivalent (m.e.) on milk-fat and skim-solids bases, estimated milk fat and skim solids are divided by estimates of milk fat and skim solids in U.S. farm milk, which vary from one month to the next.

 National milk fat test data for each month are provided by NASS. A national solids-nonfat (SNF) test based on USDA data does not exist. Therefore, an estimate is created using data reported by USDA’s Agricultural Marketing Service (AMS) and the California Department of Food and Agriculture (CDFA).  AMS reports a monthly weighted-average SNF test for Federal milk marketing orders with component-based pricing.  California is not included under a Federal Milk Marketing Order but publishes its own SNF test each month. Therefore, a weighted average of the United States SNF test is calculated based on the California data and NASS milk production data:

 Weighted monthly U.S. SNF test = { [ ( CA monthly SNF test CDFA )  x ( CA monthly milk production NASS ) ]

+ [ ( Federal Milk Marketing Order monthly SNF test AMS ) x ( ( US monthly milk production NASS )

– ( CA monthly milk production NASS ) ) ] } / { US monthly milk production NASS }

 

Milk equivalents for U.S. dairy trade are calculated by assigning a milk-fat percentage and a skim-solids percentage to each dairy product by the 10-digit HS code. For an Excel workbook with conversion factors for each HS code, as well as the sources for the conversion factors, click here. To calculate a product’s milk-fat or skim-solids milk equivalent, the product quantity is multiplied by a metric conversion factor and then multiplied by the fat or skim percentage of the product divided by the applicable test from that month. This yields the pounds of milk needed to produce the published quantity of dairy product. 

 For example, to convert 4,000 kilograms of cheddar cheese into a skim-solids basis milk equivalent in a month when skim solids in farm milk are 8.7 percent, the following formula would be used:

 (Product quantity [KG or Liters] x (Metric Conversion Factor) x (Skim percentage)

/ (SNF Test) = Skim-solids basis milk equivalent (4,000 kg of cheese) x (2.204623 pounds/kg) x (29.9 % of skim solids in cheddar cheese)/ (8.7 % of skim solids in farm milk) = 30,307 pounds of m.e. on a skim-solids basis                                 

This number is divided by one million, as commercial disappearance numbers on milk-equivalent bases are published in million pound units.

 

Commercial Exports, DEIP, and Donations 

Dairy exports through the Dairy Export Incentive Program (DEIP) or U.S. Government donations must be subtracted from total exports reported by the U.S. Census Bureau in order to represent an accurate commercial export figure. ERS has obtained DEIP amounts and U.S. Government donations on a monthly basis starting in 2004. For years before 2004, ERS has only annual estimates of DEIP and Government donations (Government-related exports). Therefore, prior to 2004, ERS has made the simplifying assumption that monthly Government-related exports are the same proportion of total exports for each year. 

Updates

 The timing of updates is linked to releases of reports by the sources listed above. In general, the target date for posting annual tables containing the most recent revised annual data is during the June-August period.  Updated monthly tables are posted at various dates toward the end of each month.  Quarterly U.S. milk production and related data is updated soon after revised data for the last month of the quarter are available.

 Historic data

 Previously published historical dairy data are available in a Dairy Yearbook accessible through the USDA Economics, Statistics and Market Information System (ESMIS), a collaborative project between the Albert R. Mann Library at Cornell University and several USDA agencies. The Yearbook contains data on production, supply and use of milk and manufactured dairy products, wholesale and retail price indexes, prices received by farmers, milk production costs, and regional shares of U.S. milk production, among other information. The Yearbook was last updated in September 2005. Data contained in archived Yearbooks may not be comparable to the dairy data tables due to subsequent changes in the methodology used to calculate supply and use.



[1] The Dairy Products Price Support Program and the Dairy Export Incentive Program ended on September 30, 2013. 

[2] While the ITC descriptions provided by the USITC Interactive Tariff and Trade DataWeb are useful, they are not as accurate or complete as those in the actual tariff schedule. In the Excel workbooks, DataWeb descriptions are provided instead of the actual HTS descriptions in the interest of brevity.

 

Last updated: Thursday, September 25, 2014

For more information contact: Roger Hoskin and Jerry Cessna

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