CORONA VIRUS: THE GLOBAL DAIRY INDUSTRY REACTS


Team Tulya (Students of Dairy Technology) - B

It’s been hogging the headlines in recent months, coronavirus (COVID-19) has claimed 3,831 lives with reported 110,381 cases to date. The impact of COVID -19 has been felt across a variety of industries. What have the reactions been in the dairy industry?


When looking at the dairy sector particularly, the coronavirus has bestowed an element of ‘unease' around the global dairy market. We take a look at the situation in some countries and some reactions around the globe…


Australia

When it comes to export, China is Australia’s biggest export destination for dairy products and in 2019 a total of 245,000 tonnes of product was sent to the country.

According to a news report by Dairy Australia senior analyst, Sofia Omstedt said the evidence of the impacts from the Coronavirus, is largely anecdotal at this stage because there is little data available. “The ultimate impact depends heavily on how long it takes to get the virus under control.” She believes there will be an impact on the foodservice because of the number of people on larger eating out.


New Zealand

With the ongoing spread of the Coronavirus and 16 million people in the Lombardy region, Northern Italy, on lockdown, the impact of the Coronavirus outbreak continues to spread and causing the New Zealand dairy industry to worry.



A report by New Zealand states that Richard Wyeth CEO of Miraka Dairy, a Taupo-based dairy processing business with more than 130 staff is keeping a close watch on COVID-19, like many in the dairy industry.

I’ve spoken to a few (dairy industry CEOs) in the Agri sector who are nervous about what’s happening,” Wyeth said. “certainly where they’ve got large exposure to china and where they’ve got fresh products. I think they’re the ones that are probably more nervous than the likes of myself who have got a bit more time.


“With Coronavirus, what the ( Chinese) government did to reduce impact was actually told people to stay home for an extra week,” Wyeth said. “So it’s really impacting the hotels, restaurant and café trade over there,” he added.

“If this had happened during the peak milk period in October, it would have been really significant. But because we’re in the lower period of the year with milk flow, it’s not having a sever of an impact as it could have.”

USA

The story may be a little different in the US were in Wisconsin dairy farmers and other producers are feeling the impact of trade.

Uncertainty due to COVID-19.According to a report by Wisconsin state former, Mark Stephenson, director of dairy policy analysis at the University of Wisconsin-Madison, said milk futures price dropped dramatically in early February as the number of coronavirus cases continued to grow.

Stephenson started that market reactions come from a concern about how widespread the outbreak will become and its become an impact on dairy exports. “It’s a pretty big concern when you’ve got the world’s latest importer of dairy products with obviously such a problem as the Coronavirus appears to be,” Stephenson said.

“You may find that it’s just hard to get products into the country and to move them through a country. We do see a number of other stories, higher-profile stores that are closing down and just not open for business,” Stephenson said.


Secretary Tom Vilsack, CEO of the US Dairy Export Council and former US secretary of Agriculture noted 2 main reasons prices are suffering: A backlog at Chinese ports and reduced demand. Vilsack further said: “ we’re working our way through that process and so we’re probably going to see a continuation for several weeks or months of continued congestion at those Chinese ports, at the coastal ports.”

“I still think on a global basis coronavirus knocks something like 6%, maybe 7% off the dairy prices over the next 12 months, ”says Nate Donnay, director of dairy intelligence at INTLFCStone.

Romania

Meanwhile in Romania in February the consequences of public hysteria were very much visible in supermarkets. The Romanian public has had major concerns over a possible national out brake hitting the country.

Shoppers across the country took to supermarkets panic, waiting to stock up on groceries. Major concerns and fears in Romania that the impact of the virus would leave food supplies short has resulted in many being weeks' worth of groceries in one go. Packed to the brim shopping carts and empty meat and dairy shelves could be seen in Romania, due to the growing sense of panic gripping the country.


“There is no need to change our way of life, no need to crowd supermarkets, empty shelves and panic our relatives at home or abroad. When someone is quarantined, that person is cared for by authorities,” said the ministry state secretary, Nelu Tataru, at a press conference.