China's thirst for milk gives U.S. dairy farms a boost

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http://www.latimes.com/business/la-fi-feeding-china-dairy-20140315,0,5345274.story

China's thirst for milk gives U.S. dairy farms a boost
American dairy farmers see an opportunity as demand booms in China. In a Nevada town, a new factory will produce milk powder just for export.
By David Pierson
March 15, 2014, 9:00 a.m.

FALLON, Nev. — The dairy plant with its tangle of stainless steel pipes rises out of the parched landscape here like a beckoning oasis.

In a few weeks, every drop of milk collected from the surrounding farms will be brought to the plant and converted into fine powder inside a towering heating chamber specially made for the $85-million facility.

But instead of being delivered to U.S. stores, the milk powder will be trucked nearly five hours away to the Port of Oakland and then loaded onto ships to China in bags emblazoned with the American flag.

Overseas demand is driving up milk prices in U.S. supermarkets. The average retail price for a gallon of whole milk was $3.55 in January, the highest in more than a year. Wholesale prices for milk used to make cheese hit a record high in February at $23.35 per hundred pounds. That trend could continue as dairy farms struggle to increase production amid one of the nation's worst droughts.