FREE Guide - 5 Chart Patterns You Need to Know!

The history of Milk and where it is produced


Brief History of Milk

Historic evidence suggests that man has been using milk as a source of nutrition since prehistoric times.

When man gave up his nomadic lifestyle in around 10000 B.C. and began to settle down in communities, he began domesticating animals, and using milk for drinking and creating by-products. The first cows were domesticated in the Fertile Crescent in the East.

Dairy cows were domesticated and milked in the Mesopotamian and Sumerian civilizations as well. In ancient Egypt, milk was meant only for royalty, priests and the wealthy class. The cow was actually worshipped as sacred in ancient Egypt and given the name Hathor, who was considered the goddess of the fertility of the land.

Dairy animals spread to Europe from Southwest Asia from around 7000 BC to 4000 BC and many farmers in the Eurasian steppes began milking their cows. By the 14th century, cow’s milk began gaining popularity around the world; European dairy cows were imported into the U.S. around 1600s.

With the growth of railway networks and expanding population pressures, milk consumptions took off in the 19th century. Louis Pasteur discovered the method of pasteurization in 1862, which enhanced milk’s shelf life and safety. Thus milk began to be stored and distributed over long distances. Commercial machines for pasteurization were invented in 1895. By 1917, almost all cities in America required pasteurization of milk.

In the late 19th century too, the first glass bottles were patented, after which milk began to be delivered in glass bottles by milkmen throughout America. In the 1930s came milk cans and plastic-coated paper cartons which further increased the transportation and distribution capabilities of the milk market.

Milk consumption grew steadily around the world—including the U.S.—throughout the 20the century, but while milk is most popular in Asian countries today, its demand in Western countries has slowed down considerably.

Where is Milk Produced?

According to FAO data, global cow milk production was around 620 million tons in 2012.

The U.S. was the world’s largest cow milk producer—responsible for 14.6% of the world’s milk— with 91 million tons in 2012. According to the U.S. Department of Agriculture, California was the leading milk producing state, with over 3500 million pounds of milk, followed by Wisconsin, New York, Pennsylvania and Idaho. Most of this milk came from the Holstein cow, which produces the highest volume of milk as compared to any other breed in America.

India was the second biggest producer with 54 million tons (8.7% of world production) in 2012. China followed at 37.7 million tons and Brazil at 32.3 million tons of milk. Other top 10 producers included Russia, Germany, France, Turkey, New Zealand and the U.K. These top ten producers accounted for over 55% of the world’s milk production, which indicates that it is a pretty concentrated industry in terms of production.

Nearly 7% of the milk produced is traded in the international markets globally as butter, cheese, casein, milk powder and condensed milk.

The EU is one of the world’s largest dairy exporters, with 32% of all global milk exports.  New Zealand has a comparatively smaller share in world milk production (only 3% of the world’s milk comes from the island nation), but it is astonishingly the world’s second largest exporter of milk, with over 30% share in the milk export market worldwide.

The U.S. is a major milk producer but is responsible only for 8% of the world’s exports, although U.S. exports of milk have soared sharply in recent years.

Other exporting nations include Canada, Argentina and Uruguay.

How is Milk Used?

Global demand for milk has varied frequently in recent years.

While butter consumption declined constantly since the mid 1980s, the per capita consumption of butter has stabilized in many Western countries now. The demand for fresh milk products such as yogurt or liquid milk has remained almost the same in developed markets, but there has been an expansion in the developing market for such products. China, Rest of Asia and South America have witnessed rapid increase in consumption of such milk products and this has pushed prices across the board.

The demand for cheese has shot up massively in both developing and developed countries. This implies that the demand for Class III milk has risen too, given that Class III milk is used primarily for producing cheese.

Per Capita milk consumption has been falling in the U.S. for years—helped along by juices, flavoured waters and competing beverages. While U.S. consumer demand for milk has been lukewarm, U.S. dairy exports have risen by nearly 19% in 2013 and are now worth over $6.7 billion.

The greatest demand for milk comes from Asian countries, specifically China, where growing populations and evolving taste preferences have made foreign milk, especially powder milk, extremely popular. Total dairy sales to China rose by an astonishing 70% in 2013 and now equal over $700 million. This was largely due to adverse climatic conditions in key milk producing regions of the world, like Europe and New Zealand.

 

Get This FREE Technical Analysis Guide!
Timing is everything, and with this guide, you'll learn how technical analysis can help find the right time to enter and exit your futures trades. Nearly 30 explanations and examples of the most popular technical analysis tools are all in this one handy guide. It's like having a futures trading mentor at your side!