Soaring prices make United States viable for importers US milk output in the first half of this year fell back by around 2% and provisional figures for July indicate a further decline of at least 1%. This is in sharp contrast with the past few years when output has been rising steadily by between 1% and 3% a year. An inevitable result has been that output of both butter and cheese has been dropping so far this year ­ cheese by 2% and butter by over 8%. Imports are not normally a significant factor in the US butter and cheese markets as strict import quotas and high import tariffs are part of the system. The result has been that lower domestic output has led to soaring butter and cheese prices. Last week, butter prices broke nearly all records and hit $4,900 per tonne which was 80% higher than a year earlier. This is about £3,100 per tonne or over 50% above UK levels. At these levels, it has even become worthwhile for some importers to pay the import duties and ship into the US market compared with selling in third world markets at around $1,300 per tonne. In the first half of this year US butter imports rose by 56% to 5,300 tonnes, much of the growth coming from New Zealand. US cheese prices have also been rising sharply and Cheddar blocks last week were at $3,800 per tonne (about £2,400 or much in line with UK prices). This level was up by 36% on late August last year. {{M/E CANNED GOODS }}