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How Dairy Stocks Could Milk Gains From The Trans-Pacific Partnership

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How Dairy Stocks Could Milk Gains From The Trans-Pacific Partnership
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The controversial Trans-Pacific partnership (TPP) could be a boon for the dairy industry. While both presidential candidates have both come out against the TPP, American farmers are trying to save it. It is one of the few issues both Democratic candidate Hillary Clinton and Republican candidate Donald Trump are in agreement on.

The partnership does make American food exports more attractive to new Asian markets and could increase food exports by more than $5 billion. The deal also provides major benefits to the dairy companies, following a report that the TPP would create growth for the industry.

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The USDA has announced that it is willing to purchase $20 million of cheddar cheese to reduce a private cheese surplus that has hit record levels. The USDA is expecting dairy prices to increase throughout the year. The new deal provides a boost for the industry that has seen a 35 percent drop in revenue over the last two years.

The dairy industry's growth is heavily reliant on the TPP, which could create an additional $150 million to $300 million in annual dairy exports. The partnership includes 12 nations that represent 40 percent of the world's GDP.

Companies that could benefit if the TPP holds up include WhiteWave Foods Co (NYSE: WWAV) and Dean Foods Co (NYSE: DF).

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Posted-In: 2016 presidential election cheddar cheese cheeseNews Emerging Markets Commodities Markets Media Best of Benzinga

 

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