April 2009 Archived Dairy News

Thursday, April 30, 2009
Milk Feed Ratio Up Slightly
MILC Payment Rates and Projections
Raw Milk Sales Should Not Be Allowed Across State Lines
Committee says it's safe to let more 'raw' milk flow
DIBS address issues facing dairy producers dealing with milk prices
Dairy Market Report for April 2009
Milk Prices in Three Categories Expected to Climb
Clearing the Air on Smog: Cows vs. Cars
Four-State Dairy Conference Slated for Mid-June
West Texas dairy herd infected
Farmer, Milk Hauler Charged in Cheese Plant Sales Scheme
Group wants Rosendale Dairy permit reconsidered
Recession Takes Toll on Dairy Farming
Animal science students excited about Australian trip
Clara Belle the cow visits Cram Elementary School
O'Connor High student's cow artwork vies for $20000 prize
Sen. Johanns Speaks to Farm Broadcasters
UK: 'Dairy summit' over milk concerns
Women in ag: A success story in Afghanistan
Wednesday, April 29, 2009
Refuel With Chocolate Milk message catching on in a big way
MPCA: Excel Dairy must clean up its act
Proximity to dairy could pause B&B plans
Proposed animal gas tax revisited because of EPA finding
Dairy farmers see decline in revenue, production stays steady
Dairy's Slow Slog to Recovery
Pfizer Animal Health Introduces SolidBac^®For Convenient Pinkeye Protection  
Brady Core selected as the 2009 recipient of the Fred Stout Experience Award
Ag Consultants to Meet in Nashville
UK: Dairy farmers stage milk protest
New Zealand: Dairy industry sees glimmer of recovery
Statement from the National Pork Board on Swine Influenza
Tuesday, April 28, 2009
The new version of the Specter-Casey Dairy Bill S889 is ready to go
Market Analysis with Bob Cropp
Economy prompts dairy herd dispersal
Ew, that smell: Dairy upsets neighbors, health officials
OSU researchers use pedometers to measure cow happiness
RFID-enabled system moo-ves dairy farming into the future
Farmers, consumers, store owners fight raw milk ban
Tension Builds Between Organic Dairy Farmers And Processors
The grass is always greener
Cow Genome Research Provides Clues to Evolution
Scores of youths left dairy farms for employment
Cashton Student Wins Guernsey Calf Essay Contest
Milking on the way to class: Club hosts event to learn about dairy
Fonterra Sells Stake in India Venture to Britannia
Robotic Milkers: It's Milking Time All Day Long In Underwood
Australia's second robotic dairy starts milking  Robotic dairy specially modified
UK: Large Herd Seminar moves to the South West
Monday, April 27, 2009
Western United Dairymen Update
Milk Producers Council Update
Specter, Casey team up in effort to help dairy farmers
DMI Update
Glimmer of hope for dairy producers
Conn. dairy owners making their own house calls
Bank liquidation a blow to Greeley
'Mooving' experience
Falling milk prices hurting dairy farmers
Economy is taking its toll on Vermont's farmers
Riding out the storm
Amish Dairy Farmer Welcomes Amazing Natural Technology
Car dealership enrolls in "Cow Power" program
WI: State's milk production increases for March
Kansas Governor Vetoes Hormone-Free Milk Labeling Bill
Cow smooch so rewarding
Family keeps dairy farm, traditions alive
Friday, April 24, 2009
Dairy Markets Weekly Recap
UC Davis-led Research Consortium Explores Milk Genome
Cow genome mapping could have 'big impact'   Related
National Dairy Leaders Meet in Denver
Preliminary Tests Indicate Cattle TB Infection in Texas Dairy
MILC Payment Rates and Projections
Six breeds judged at Spring Dairy Expo
Cattle Feed Byproducts: Experience & Education Enhance Nutrient...
Sebelius Vetoes Milk Labeling Measure
Spring 2009 AI Bull Census available online
Cow exit plan holds currency
Farmers: Help Us Keep Milk Flowing
A losing proposition: Farmer sells his dairy cows
July 1 is Deadline to Apply for National Jersey Youth Scholarships
Thune: ‘Cow tax' closer to reality
New White Paper Examines Role of Ag Innovations in Meeting World Food Crisis
Thursday, April 23, 2009
Dairy Leaders Meet in Denver
Choosing A Mineral Supplement For Your Dairy Cows
Dairy herd retirement program draws high interest
Humboldt Creamery's disorder was allegedly hidden for years
Cross Country: Holsteins, camaraderie on display at big spring show
Dairy farms in danger
Low milk prices draw protests
Moo-ve over
New farmers alliance champions raw milk
Wednesday, April 22, 2009
Don't give up on the export market
Johnson says timing isn't right for dairy legislation
California moves to nip tail docking
Dairy farmers come to Capitol to talk about low milk prices
Producers Selling Cows As Dairy Prices Struggle
Michigan sets deadline for dairy to pay $223,500 fines
The ‘crop' of this creamery comes from grass-fed herd
Milk Does a Planet Good
Milk: One of Mother Earth's oldest foods
Mary Paige McGuirk dies at 88
Irvin named Dairy Princess
Tuesday, April 21, 2009
Latest Cold Storage Data
Market Analysis with Brian Gould
From the Big Apple to America ’s Dairyland
Plans in the works for large dairy research farm
Animal Agriculture Producers to Benefit from New National Johne’s Disease...
Dairy farmers caught in dire economic squeeze
With Much at Stake, Dairy Processors Urged to Attend Washington ...
Genome Sequence Sheds Light on Ruminant Evolution
4-H members compete in Dairy Bowl
MCGA: Dairy Farmers Find Value In Ethanol Co-Product
Ad explains smell of spring (and manure)
Cows that pass less gas? Researchers hope so
Senators Denounce Environment Protection Agency Proposed Findings
Meadow Gold closing changes landscape for dairy farmers
Q&A with Carl Rennell, co-owner of Maggie Moo's
Candidates being sought for St. Lawrence dairy court
Fonterra enters Egypt with new partnership with Arab Dairy
American Dairy annual net income up to $30.09m
Monday, April 20, 2009
Plans in the works for large dairy research farm
Land O'Lakes to close Madison Dairy
Country Fresh dairy in Flint to close after 80 years in business
Lincoln Dairy Closing
Dairy Liquidation Leads Cow Slaughter
Lock City Dairies ponders move from bottles to bags
Manure leak at dairy operation in NW Iowa
Experts help dairies milk what they've got with cost-cutting tips
Ag Day to feature UD's own ice cream
Dairy industry sees less-gassy future for cows
North Dakota milk production down in first quarter
DMI Update
Friday, April 17, 2009
March Milk Production down 0.2 Percent
Dairy Markets Weekly RecapMay Federal Order Class I Price Up 61 Cents
While The Trade Picture Isn't Pretty, The News is Better for U.S. Dairy Consumers 
Interest High IN CWT Herd Retirement Program
TSCRA: Cattle Theft Bill Passes Texas State Senate
Help for Vermont Farmers   Related
Area farmers have a friend and partner in Quist; MN Outstanding ...
Cases 14, 15 don't change BSE risk level: CFIA
Protest over EU milk prices
Thursday, April 16, 2009
Latest Dairy Outlook
Officials Discuss Changes in TB Eradication Program
Land O'Lakes to close Madison Dairy
Longtime Frazee dairy farmers sell out
Montrose dairy must abide by conditions after illness outbreak
Lawmakers ask feds to aid dairy farms
Wisconsin Farm Bureau Federation®AG Wire
Feeding for pounds of fat and protein: That's all you are paid for
Editorial: Think ahead to farm show
Milk glut hurts California dairy finances
You need cows that are worth owning
A quick history lesson in cheesemaking
Southland students fare well during District FFA contests
From the farm to you
Name the Agricultural & Industrial Museum's cow
No Spilt Milk For Danone
American Dairy Reports 2008 Financial Results
Fonterra looks to buy up Sanlu leftovers
Cattle getting lame from NSW floods
Milk farmers furious at litre price cut by Glanbia to 20c
Wednesday, April 15, 2009
Market Discussion with Dave Kruzawski
Guest Editorial: New dairy bill is ready to go 
Montrose dairy must abide by conditions after illness outbreak
Coopersville is 'ecstatic' about powdered milk operation pegged ...
Balance is important in Deutmeyer's farming operation
Quality, sustainability drives local dairy farmer
Dairy Industry Is Hoping To Reduce Methane Gas Produced By Dairy Cows
It's milking time all day long on Johanson's Underwood farm
Kansas complicating the labeling of dairy products
KY Milk Hauler Award nominations now open
Nick and Tara Meyer are Good Farm Neighbors
Agriculture Left Out of Obama Cuba Policy
USDA jumps in to help food producers
Newsmaker Q&A: Raw milk dairy farmer Bill Coutu
Milk recording should be retained
Automated heat detection brings savings
McNallan Farm knows a thing or two about winning yield contests
Irish farmers protest at Glanbia milk price cuts
Milk Link selling cheese to China
Tuesday, April 14, 2009
The Market Does Turn Around....Eventually
Landmark welfare case up to WTO?
Stater Bros. Markets to sell Santee Dairies to Dean Foods
Dairy cow of future may pass less gas, HFR, WI
Mail in Your Ballot for the WMMB Elections
Experts help dairies milk what they've got with cost-cutting tips
Community raising stink over cow farm
Tulare cow births four; three survive
Borden Gives the Dairy Case a Fresh Look
Milk man making a comeback
NIAA Annual Meeting: Speakers Hit Mark, Consensus Results in Resolutions
Dairy farmers take a hit from a drop in milk prices
American Dairy Association donates milk to Indiana food banks
Monday, April 13, 2009
Farm bureau member visits Washington
Cheese-maker makes farmers an offer
Milk hauler says dairy fund will avert extinction
Economic crisis imperils dairy farms
Country faces shortage of large-animal veterinarians
Declining dairy prices costly to West Michigan farmers
Farmland is disappearing in Waukesha County, and statewide
Farm program looks to future
Challenging Year For U.S. Dairy Exporters
Iowa State House Rally Poster
MILC Payment Rates and Projections
Western United Dairymen Update
Milk Producers Council Update
This Week in Dairy Profit Weekly
New Tool Reveals Avoided Impacts Linked to Organic Milk Production
Mo. House backs tax break for dairy farmers
Veto urged on Kan. milk labeling bill
Milk business going sour?
Cattle Outlook: Beef And Dairy Cow Slaughter Up
World Dairy Expo Announces New Staff
CA: Dairy Producers begin 2009 search for Royalty
Scotland: Fluffy forage boosts profit margins
Australia: Jersey milk an udder delight
Friday, April 10, 2009
Producer-Handler Debate Illustrates How The Dairy Industry Has Changed
Dairy Farmers Plan Rally Tuesday in Des Moines  Iowa State House Rally Poster
Dairy Markets Weekly Recap
MILC Checks to Dairy Farmers Further Delayed
Mo. House backs tax break for dairy farmers
Low prices hurting dairy farmers
WASDE: Milk Production Forecasts Down, Price Estimates Up
Friday, April 10, 2009
Dairy Markets Weekly Recap
MILC Checks to Dairy Farmers Further Delayed
Mo. House backs tax break for dairy farmers
Low prices hurting dairy farmers
WASDE: Milk Production Forecasts Down, Price Estimates Up
Thursday, April 9, 2009
California Class 1 Milk Prices Moving Higher
Milk Production Estimate Lowered for 5th Month in a Row
Hearing on Modifying Producer-Handler Provision in Federal Order Milk Markets
Amid milk price turmoil, dairy owners consider getting out
Dairy Tax Credit Could Save Dying Dairy Industry
Federal lawmakers use recess to pay visit to constituents
Carolina farmers scramble in late-season cold snap
CO: Bacterial illness linked to dairy
Spring Dairy Carousel opens at Fairgrounds
Tulare schools Pleasant, Mission Valley and Kohn to get visit from ...
Wednesday, April 8, 2009
Dairy Product Demand is Good
Some dairy operations urged to pay into price pool
Wisconsin dairy plants plan $781M in investments
Mo. House approves tax credits for dairy producers
Dairy producers seek answers to economic crisisSenator talks of military, dairy issues
AABP Partners with Pfizer Animal Health in New Scholarship Program for Vet Students
Holmes County dairy producers awarded at banquet
Salinas-area dairy industry seeks its 2009 princess
Tulare high school farm gets new dairy barn
Tuesday, April 7, 2009
Positive News From Dairy Products Report
Some dairy operations urged to pay into price pool
Sens. Specter and Casey preparing to re-introduce dairy bill
Northeast Farmers continue opposition of milk pricing
Milk bill smells sour to some dairy producers
Holstein Association USA Board Holds Spring Meeting
South Dakota Dairy Farmers Look to Bright Future
Northey says Iowa Ag Department may see furloughs
Applications Invited for National Stocker Award
Monday, April 6, 2009
DMI Update
Pfizer Vet Visit - Foot Rot
Milk Producers Council Weekly Update
IND Dairy Tech's cow breeding technology expands Canadian-style...
Low Dairy Prices Trigger Payments To Milk Producers
Dairy co-op faces lawsuit
OKC area Domino's Pizza partners with local dairy farmers
Friday, April 3, 2009
February Dairy Products Report
Cash Dairy Markets Weekly Recap
March Class III Price Gains $1.13
It's a little early to get excited about field work
News for Dairy Co-Ops
USDA's Release of Surplus Dairy Products Being Applauded
Milk co-op reports loss
After 89 years Norz-Hill Farm sells their dairy cows
Foremost sells two plants to Dean Foods
Morning Glory dairy plant in Ashwaubenon sold to Dean Foods
KLA: Herd Retirement Self-Funded By Dairy Industry
Targeting the best semen at the most fertiile
Making slurry pay: Anaerobic digester provides a new simple solution
Herd lameness timebomb to stun masses?
Cross Country: Farm Show draws a big crowd -- and not just farmers
Cow goes to school at Welch
Thursday, April 2, 2009
Federal Order Milk Price Projected To Jump $1.16
Mid-Week Milk Production Update
CWT will conduct its seventh herd removal
Cover All the Bases to Maximize Dairy Reproduction
CAFO opponents gain input
Aubertine Calls for Bipartisan Effort for Dairy Farmers
Conference addresses important dairy management issues
Dairy Cattle: Do Silage Inoculants Survive The Ensiling Process?
Council approves backyard livestock
Australia: Cow sell-off increases
Wednesday, April 1, 2009
California March Class 4 Prices Announced
Dairy Leader Calls for Consistent Nutrition Standards in Schools
CWT Announces Herd Retirement
The School Lunchroom Has Changed Since We Were There
Dairy Market Report - Roger Cryan, NMPF
Vilsack open to animal ID but wants to allay fears
Bill proposes changes on dairy labels
Dairy farmers get break
Young Leaders of the Dairy Industry Compete at 2009 NAIDC 
Dairy Checkoff Update - March 2009 
Lifeway Foods Reports 4th Quarter and Twelve Months Ended December ...
Report: Colorado remains nation's No. 15 dairy state
Report: Vt. ranks No. 16 in nation's milk production statistics
State's Only Organic Feed Mill Closing
Got milk? Not anymore
Future Proofing New Zealand’s Dairy Cows
4-H teaches responsibility

MILC Payment Rates and Projections
Feed futures are down again, cutting the projected target prices.

(April 30, 2009) The 32^nd National Conference on Interstate Milk Shipments (NCIMS) was held April 17-22 in Orlando and National Milk’s Director of Regulatory Affairs, Jamie Jonker, reported one of the topics in Thursday’s DairyLine, namely a proposal for the NCIMS to support the allowance of raw milk sales across state lines.

“The NCIMS and the Pasteurized Milk Ordinance that comes out of it, are about milk safety of Grade A products,” Jonker said. “The conference felt that it (the proposal) would send the wrong message,” so it was defeated. He likened it to “playing defense,” and said that allowing raw milk sales across state lines “would have a negative impact on the industry.”

Advocates, almost with religious fervor, view raw milk as a natural elixir and believe we are hurting consumers by limiting access to raw milk but Jonker counters, “Data shows conclusively that pasteurization really is what we need to do to ensure the safety of our milk products for the American consumer.”

“Milk provides a great nutritious product for everyone in the U.S.,” he said, “But raw milk can have issues leading to illness and when we look at data from the CDC (Center for Disease Control) we see that states that have allowed sales of raw milk at some point of time over the past 10-15 years they’re more likely to have outbreaks due to raw milk consumption.” Pasteurization is almost a “silver bullet,” he concluded, “that makes milk safe for everyone to consume.”

(April 29, 2009) Over the last few years, more Americans have started to recognize exercise as a critical component of a healthy lifestyle. The International Dairy Foods Association’s, Miranda Robertson, reported in Wednesday’s “Processor’s Perspective” program that this trend “creates a huge opportunity to expand demand for milk, simply by promoting its sports recovery benefits.”

The “Refuel With Chocolate Milk” message is catching on in a big way, according to Robertson. High school, college and even professional athletes are reaching for chocolate milk after exercise, she said. “It's a smart sports drink with nine essential nutrients not found in most traditional sports drinks.”

To boost awareness of milk’s recovery benefits and help consumers see milk in this new light, the Milk Processor Education Program (MILKPEP) and Dairy Management Inc have teamed up to support three new studies, which will add to the body of research supporting chocolate milk as a post-exercise beverage.

“The new research will help us understand more about how chocolate milk may affect muscle and post-exercise recovery,” Robertson said. These studies from top research institutions look at the benefits of drinking chocolate milk compared to traditional sports drinks for different types of athletes or non-athletes, she said.

The MILKPEP is taking milk’s recovery message directly to moms. Twelve-time Olympian medalist, mother & author, Dara Torres, is the newest face of the milk mustache campaign.  She is the ideal spokesperson to deliver milk’s recovery message to moms, Robertson said. Dara unveiled her new milk mustache ad at a recent press conference and shared her secret training weapon and key to her killer abs: chocolate milk. Her ad will run in Fitness, Women's Health, Time, Newsweek, People, Shape, and Women's Day to name a few. To learn more about “Refuel for Moms,” www.visitwhymilk.com and for more information on the teen program, visit www.bodybymilk.com

(April 28, 2009) Cheese trading at the Chicago Mercantile Exchange started the week with a slip as the blocks lost a half-cent and barrels were down three quarters of a cent despite some positive perception from last week’s Cold Storage report and the March Milk Production report prior to that. News of a possible swine flu pandemic was raising havoc in many commodity markets according to some insiders.

Dr. Robert Cropp, Emeritus Professor at the University of Wisconsin at Madison, said in Tuesday’s DairyLine that he hadn’t thought of that and wasn’t sure why swine flu news would affect dairy markets.

As to why cheese prices remain so weak, Cropp said that February cheese output was fairly strong and it’s strong seasonally. He has heard reports that many plants are full and stocks are ample. The March 31 report had American stocks up 6.8 percent from a year ago and total cheese was up over 8 percent.

On the other hand, Cropp pointed out that milk production is slipping, according to the March report, and California output was off 3 percent, a “significant amount,” but he sees cheese prices remaining close to current levels for a while as we “clean out some stocks but as we move through the summer and early fall, I think you’re going to see some comeback.”

Buyers aren’t building a lot of inventory and are taking advantage of the low prices as they need cheese but he sees strength returning in June, July, and August. Don’t expect $2.00 cheese, he cautioned, but $1.30-$1.40 seems like a “reasonable number,” he said.

He does not expect cheese prices to fall to the government support level and product moving to government warehouses unless the price falls well below support so as to make it economically feasible to sell to Uncle Sam. We’re close to it on the barrels, he admitted, but he doesn’t expect cheese to move to the government.  

(April 27, 2009) California dairy producer and Dairy Management Incorporated board member, Kimberly Clauss, talked about the concept of sustainability in Monday’s “DMI Update.” It was an interview recorded at the recent World Ag Expo in Tulare and Clauss pointed out that sustainability is something dairy farmers practice in their everyday life; economically, socially, and environmentally.

Economically, she said they may practice sustainability by changing the type of pump they use to a variable speed.

Environmentally they may reuse milk cooling water to wash cows and flush their barns and then irrigate it on the fields.

Socially, dairy farms employ people from the surrounding communities and they provide nutrient-rich dairy products to consumers.

“When you look at it that way, sustainability isn’t so bad,” Clauss said, and the Dairy Innovation Center is working on projects to spur more of this. She encouraged listeners to participate in the “Life Cycle Analysis,” a random survey being taken across the U.S., with the goal of 1,000 dairy producers participating to determine what dairy’s true carbon footprint is.

“I don’t know what my carbon footprint is for our dairy operation,” Clauss admitted, “And I’m sure most dairymen don’t actually know that so we need to find out what that is.”

(April 24, 2009) The block cheese price closed Friday at $1.18 per pound, up a penny on the week but 74 1/2-cents below a year ago. Barrel closed at $1.1075, down a quarter-cent on the week, and 77 1/4-cents below a year ago. Twenty nine cars of block traded hands on the week and 13 of barrel. The NASS U.S. average block price hit $1.2771, down 0.1 cent, while barrel averaged $1.2495, down 4.9 cents.

Butter strengthened, likely due to weather-inspired ice cream demand, closing Friday at $1.2225, up 2 cents on the week, but still 19 cents below a year ago. Twenty two cars were sold. NASS butter averaged $1.1737, up 1.6 cents.

Cash Grade A nonfat dry milk inched up a penny and a half, to 86 1/2 cents per pound. Fifteen cars traded hands on the week. Extra Grade remained at 85 cents, with no activity.

NASS nonfat dry milk averaged 81.95 cents, down 0.1 cent, and dry whey averaged 20.15 cents, up 0.8 cent.

National Dairy Leaders Meet in Denver
Dairy Profit Weekly editor, Dave Natzke, also attended the National Dairy Leaders conference this week in Denver and reported Friday that the economy and its impact on farmers’ milk prices was on everybody’s mind. He said there still seems to be some “shock” among producers on how quickly and how far milk prices have fallen.   

Many western dairy farmers he talked with said that, at current milk prices, they were losing up to $3 per cow per day, or nearly $100,000 per month, for each 1,000 cows.

Regionally, Natzke reported that there was concern over the recent collapse of the New Frontier Bank of Greeley, which some estimated provided financing for up to one-third of the dairy cows in Colorado and adjoining states. 

“Despite the economic situation, producers and other dairy leaders were engaged in many other issues affecting their businesses,” Natzke said, “A good sign that they do see a future in the dairy industry.”

Updating DairyLine listeners on recent developments in the ongoing rbST-free debate; Natzke reported that a U.S. district judge has denied an injunction sought by the International Dairy Foods Association and Organic Trade Association to block implementation of Ohio’s milk labeling rule that restricts use of "rbST-free" or "hormone-free" labels, ruling that such labels are misleading. Similar labeling legislation was approved in Kansas, and awaits the governor’s decision.

Meanwhile, the Oregon Physicians for Social Responsibility, which opposes use of recombinant bovine somatotropin, said more than half of the nation’s 100 largest dairy processors have completely or partially discontinued accepting milk from cows supplemented with rbST.

In contrast, Natzke reported on a study involving milk processing company executives and consumers which concluded that the dairy industry may have overreacted and acted too quickly in prohibiting rbST use by their dairy farmer suppliers. The report said the shift to “rbST-free milk” was driven by a small percentage of consumers and yielded minimal consumer response, according to Natzke, and most executives said they would not make the decision again.

Roger Cryan, Vice President, Milk Marketing & Economics
National Milk Producers Federation

Dairy Leaders Meet in Denver
The National Dairy Leaders conference was held this week in Denver. National Milk’s Chris Galen reported highlights in Thursday’s broadcast. He said the meeting is held every two years in different locations around the country and involved people active in cooperatives, processors, and promotional organizations to sit down and discuss the current issues facing the dairy industry.  

“This was certainly a critical time for dairy leaders to be meeting,” Galen said, “given the gravity of the economic problems facing, not just the dairy industry, but the overall economy.”

One of the main panels addressed forecasts of where the dairy economy is going in 2009 and, to a person, “There wasn’t a lot of optimism that this is something that’s going to resolve itself quickly,” Galen said. “There is light at the end of the tunnel but it’s not going to be something that’s going to happen in a month or two and, because there are so many other sectors of the economy that are hurting, financing, banking, real estate, autos, all those things globally will have to get resolved until we can really see a really strong reaction in dairy markets.”

A number of other challenges were addressed at the conference. Immigration reform was one, he said, and whether Congress will pass some form of comprehensive package that will address the labor situation on dairy farms.

Animal welfare is another issue, with all of the increasing pressure it puts on livestock operators around the country, as well as climate change and whether that presents a threat or opportunity or both to livestock operators who will be targeted as sources of green house gas emissions.

“The economy was the big story,” he said, “But, there’s certainly a lot of other big ticket items that we have to contend with going forward.”

When asked if the CWT program came up, Galen replied, “CWT only briefly came up because people are aware that they can submit bids now, if they chose to, they have about another 10 days in which to postmark a bid and send it in.

“Anecdotally, from what we heard around the room,” Galen concluded, “There are people who know people who are planning on bidding so we do expect quite a bit of interest in CWT and we’ll see how the bids come in as we get towards May.”

Dryer praised the New Zealand’s announcement Monday that it had sold about 160,000 metric tons of nonfat dry milk to China. It was probably at a “fire sale price,” he admitted, “But it means the inventory moved out and is not hanging over the market so there’s some opportunity for prices to begin firming up.”

Dryer also reported that a large U.S. cheese manufacturer will begin producing Gouda cheese and Gouda is what the world market wants, he said. World cheese supplies are not in the great abundance that butter and nonfat dry milk supplies have been, according to Dryer.

Dryer admonished U.S. manufacturers to produce what the world market wants. “The best defense is a good offense,” he said, “We’re dropping the ball there.”

A lot of people are grumbling about growing imports of milk protein concentrate and butter blends, according to Dryer, but both of them can be produced and should be produced in the U.S., he argued.

Some production has come on line, he admitted, but “We need to be producing the products the U.S. market wants as well. That’s the best way to prevent some of that imported product from coming into the U.S. Make the product here.”

Dryer says the government price support program is partly responsible for that not happening. The government is a guaranteed market for nonfat dry milk, for example, he said, and, if you can’t sell it anywhere else you can always sell it to the government.

If a company produces milk protein concentrate and can’t find a buyer, they have a problem, Dryer concluded, and “That has limited some of the innovation and competitiveness and sense of adventure that we should have had among manufacturers in the U.S.”  

The American cheese inventory for March stood at 561.7 million pounds, unchanged from February, but 35.7 million pounds or 7 percent above a year ago. February American cheese stocks were revised down  17.3 million pounds.

Total cheese stocks amounted to 892.5 million pounds, up 2 percent or 17.4 million pounds from February, and up 68.2 million pounds or 8 percent from a year ago. February total cheese stocks were revised down 17.8 million pounds.

(April 21, 2009) The cash dairy markets showed little reaction to what could have been perceived as a bullish production report. The University of Wisconsin’s Dr. Brian Gould said in Tuesday’s DairyLine that the market was neutral in its response because the report was what the market had expected, yet he thought it surprising, being as this was the first down turn in production since June 2004.

He said the drop was a result of per cow output being down and a drop in cow numbers but he believes revisions will show an even larger drop in cow numbers.  

He also pointed to the regional variation in milk output from the impact of current low milk prices. He cited California’s, Idaho’s, and New York’s drop and Wisconsin and Minnesota’s increase. Texas and New Mexico also registered increases, he said, and it’s “interesting as to who is being impacted by current prices. The Upper Midwest seems to be weathering this storm quite nicely.”

But Gould warned that last week’s Dairy Market News shows that the heavy culling that we have seen result from the CWT herd removals and the higher feed costs appears to be leveling out and the decline in milk output may not hold.

DMI Update
(April 20, 2009) California dairy producer and DMI board member, Steve Maddox, was back on Monday’s “DMI Update” in a recorded interview from February’s World Ag Expo in Tulare, said he has been on the board for about two years and has served 19 years on the California Dairies board, a cooperative that handles 43 percent of the state’s milk supply.  

He said he and his family are dedicated to helping the industry because it has given them so much, a lifestyle to raise a family on certainly not done for the money and you love the cows and the industry as a whole is like a big fraternity that tries to help one another.

Maddox has seen a lot of ups and downs in the dairy industry but admitted that this down swing is the worst he has ever seen and, while milk prices have been this low or lower in the past, they were coupled with lower input costs but that is not the situation right now, with corn at record highs mainly due to ethanol mandates etc. plus there’s a liquidity crisis, and high energy prices so it’s not feasible for dairymen to pay their bills.

DMI and the National Dairy Board can’t get too political, Maddox admitted, and they leave that to the individual cooperative boards but the two boards are made up of dairy producers so they feel the pain and it’s drastic when you income is 40 percent less than the cost of production.

“We have to look at the long term,” he said, “And try to encourage demand because we’re out of balance in supply and demand and things like Domino’s new pizzas that use 40 percent more cheese or working with McDonalds, or working with the protein and energy drinks, trying to get more dairy products used will tighten up that surplus and hopefully push up prices so we’re closer in the black.”

Butter closed at $1.2025, down a quarter-cent on the week and 19 cents below a year ago. Eight cars were sold on the week. NASS butter averaged $1.1575, down 1.3 cents. NASS nonfat dry milk averaged 82.03, up 0.4 cent, and dry whey averaged 19.31 cents, up 1.5 cents.

May Federal Order Class I Price Up 61 Cents
(April 17, 2009) The May Federal order Class I base price was announced this morning by USDA at $10.97 per hundredweight, up 61 cents from April but $5.65 below May 2008. This is the price that each individual order adds its local Class I differential to, to determine its Class I milk price. The 2009 base average is now $11.44, down from $18.51 a year ago and $11.71 in 2007.  

The Class III advanced pricing factor was the “higher of” in determining the Class I value and the Milk Income Loss Contract (MILC) payment to producers will be a minimum of $1.22, according to National Milk’s Roger Cryan, who adds that the feed cost adjustor could be an additional 0-2 cents, but he not making a projection at this time..

The NASS-surveyed butter price averaged $1.1640 per pound, up 4.3 cents from April. Nonfat dry milk averaged 81.81 cents, up from 81.52 cents. Cheese averaged $1.3030, up 4.85 cents, and dry whey averaged 18.52 cents, up 2.2 cents from April.

2-week Product Price Averages:

February exports, valued at $160 million, declined 9 percent from January and are down more than 55 percent from a year ago. Meanwhile, February imports, valued at $259 million, were up more than 10 percent from January and February 2008. After a dairy trade surplus of $1 billion in fiscal year 2008, the U.S. now has had five consecutive months of dairy trade deficits.

While the trade picture isn't very pretty, Natzke said the news is better for U.S. dairy product consumers. According to Bureau of Labor’s Consumer Price Index data for March, retail dairy prices were down 2.4 percent compared to February and 3 percent less than a year ago.

Fluid whole milk prices were down about 6 percent from February, and nearly 15 percent from a year ago. Cheese, butter and ice cream prices were all down compared to last month, but up slightly from March 2008.

Natzke also reported news on the controversial National Animal Identification System (NAIS), a centralized registry system designed to identify livestock premises and individual animals in event of an animal disease outbreak.

One of the concerns of farmers has been how the information would be used, especially if it got into the hands of animal activists. In a ruling earlier this month, U.S. District Court Judge Emmet Sullivan denied public access to NAIS data.

Attorney and freelance writer Mary-Louise Zanoni had filed suit against USDA, seeking a Freedom of Information Act request to view program records.

(April 16, 2009) Milk production is forecast to decline in 2009 on the basis of smaller herd size and a scant yield increase over 2008, according to the Agriculture Department’s latest Livestock, Dairy and Poultry Outlook issued this morning. The Outlook says domestic demand may have stabilized at a lower level and some export interest remains in dry products. Prices were raised slightly from last month.

Above-normal levels of commercial cow slaughter thus far in 2009 are a continuation of above-normal beef cow slaughter that began in the first half of 2006, when dry conditions held sway over large portions of the Central, Mountain, and Southeastern United States.

Beef cow slaughter has been influenced by intermittent drought in the West, Plains, and Southeastern United States since 1996.

In addition, beef cattle prices have declined since 2005 and feed costs, while down significantly from their peaks, have been high since dry conditions and rapidly expanding ethanol production sparked grain price increases in late 2006.

Dairy cow slaughter surged ahead of year-earlier levels for the third month in a row in February, aided in part by the sixth Cooperatives Working Together (CWT) buyout since 2003, which removed over 50,000 cows from the dairy herd, mostly in the first quarter of 2009. According to recent Livestock Slaughter reports, dairy cow slaughter had moved ahead of year-earlier levels for much of 2008. The liquidation has been especially notable in the mountain western states.

For the country as a whole, slaughter was 17 percent above year-earlier levels in February, 19 percent in January, and 12 percent in December. However, by region, slaughter exceeded year-earlier levels by 46 percent in December and 118 percent in January for region six, which includes New Mexico, Oklahoma, and Texas. January and February slaughter exceeded year-earlier levels by 83 and 49 percent, respectively, in region ten, which includes Idaho, Oregon, and Washington. Other regions also recorded double-digit increases in cow slaughter.

Although The CWT program is expected to remove additional cows from the herd by this summer, these data suggest that herd liquidation is well underway. The liquidation appears to be strongest in those regions that expanded most rapidly in the last few years. USDA forecasts that the dairy herd will contract to an average 9.2 million cows in 2009, compared with 9.3 million in 2008.

The contraction is expected to continue throughout the year; by the fourth quarter of 2009, the number of dairy cows will likely average about 300 thousand fewer than those on hand in the fourth quarter of 2008.

Expected corn and soybean meal prices have been revised upward from earlier forecasts. Higher feed costs will likely continue to pressure producer profits. Milk per cow will climb only incrementally in response to poor producer returns. The yield increase is expected to be less than one-half of 1 percent this year, adjusting for leap-year, continuing the trend toward smaller year-over-year increases that began in 2006. The outcome from these adjustments is a decline in milk production in 2009 to 187.1 billion pounds from 190.0 billion pounds in 2008.

Officials Discuss Changes in TB Eradication Program
(April 16, 2009) National Milk and the National Cattlemen’s Beef Association (NCBA) leadership met Wednesday with USDA officials to discuss changes they would like to see in the Agriculture Department’s bovine tuberculosis (TB) eradication program. National Milk’s Jamie Jonker, said the meeting was a follow up to a joint letter to USDA last fall from NMPF and NCBA on the need to update the program.  

Jonker reported that there are two unique TB issues to deal with today. Producers in Michigan and Minnesota face endemic wildlife populations infected with TB and it has appeared in the Southwest in strains that are consistent with those in Mexico. The recent TB discovery in California is a case in point, he said.

“We need to modernize our TB eradication program to reflect the realities of the low levels of TB that we have in the U.S.,” Jonker said, “And the unique issues that we have with TB in wildlife populations in one area and strains that are of foreign origin in another area.”

One of the recommendations NMPF is calling for is to develop and implement improved diagnostic tests. We’re still using the skin fold test that has been around for a very long period of time, he said, and we need to have a test that is more accurate and easier to do on live cattle.

We also need to look at changing feeder cattle practices to reduce exposure of breeding cattle to cattle of Mexican origin.

Thirdly, Jonker said we need to look at what we can do to reduce TB in wildlife, such as developing an effective vaccination. If you look at what we have done with rabies vaccination in wildlife in some areas, perhaps we can do similar things for TB in wildlife populations.

(April 15, 2009) We continued Tuesday's dairy market discussion on Wednesday with Downes-O’Neill dairy broker, Dave Kurzawski, and ask about the charges that have been made that the system is broke, that the markets are being manipulated, and that imports are raising havoc with domestic markets. How much is reason and how much is emotion?

Kurzawski responded, “The bulk is emotion right now.” He recalled how just a short while ago it was buyers of milk and cheese who were making the same complaints. The past two years they were paying a $2 plus per pound cheese price and they were making the same cries.

“It doesn’t mean it’s (the cries) not warranted,” he said, “But it does mean it’s probably more emotion than anything else and so long as we believe in the dairy industry and we believe that dairy products are good and that they’ll be around, the market will fix itself.”

How will that happen? Kurzawski said the market will adjust and he believes grain prices will come down and input costs will lessen as “they have been over valued for too long.”

He added that a bull market is best when it’s demand driven, not supply driven. “The buyers of feed in this country are going through a very difficult time right now and that’s going to come through in price on that feed, if not this month, in the very short future,” he said, “And as a result, I think you’re going to see a situation where producers who have gone through three or four or five months of just being completely backwards in the market, come into an area where they will have profitable levels.”

Regarding the import question and the fact that the U.S. is really a milk deficit nation that does not produce enough of its own milk to meet its needs; Kurzawski doesn’t see imports as “the big game in town.”

He recalled how six or seven years ago imports of milk protein concentrate was “a very big deal,” but the U.S. eventually became a net dairy exporter so “these things ebb and flow,” he said, and he doesn’t see imports as detrimental to the dairy industry as some others do. The big question, according to Kurzawski, is when will export demand start to pick back up. “It will,” he concluded, “It’s just a matter of when and that’s the bigger question right now.”

(April 14, 2009) Cheese prices continued to slip Monday, further discouraging farmers whose milk check hinge on those prices. Downes-O’Neill dairy economist, Bill Brooks, said in Tuesday’s DairyLine that, while it’s not much comfort, the market always does turn around eventually, but there’s been a lot of pain felt by producers.

Cheese is like a lot of other commodities, he said. “We’re chasing a declining demand base and we just haven’t reduced our supplies enough to match up with that.” Cheese is purchased when the buyers see good value, according to Brooks, and “That value is in the upper teens to the low $1.20s.”

Thankfully, prices haven’t plunged to the $1.04 bottom seen in January, Brooks said, and we’ve seen the market move up 10, 15, or 20 cents, but then we hit a “tipping point” and “That value that folks were looking for goes away and now unfortunately we’re seasonally outside of a good demand period, in between Easter and the unofficial start of summer on Memorial Day, and a lot of product has probably already been put away for that.”

He assures us the market will rebound but there’s likely more pain before that happens and trading will likely take place in a range of $1.15-$1.35 per pound until we get into the summer months, demand picks up seasonally, and supplies slow down.

Friday’s March Milk Production report will attract attention, according to Brooks, especially the cow numbers to see if they dropped like they did in January. He’s not sure that will happen, given the slowdown in slaughter that we have seen, but people will be looking for more visible signs of a slowdown in milk production. Some hope it will be below a year and he admits that’s possible, but more than likely it will still be slightly above last year’s level.

(April 13, 2009) 2009 will be a challenging year for U.S. dairy exporters but some suppliers are still finding success, according to the U.S. Dairy Export Council’s (USDEC) Margaret Speich. Speaking in Monday’s “DMI Update, Speich reported that, in some cases, sales have continued despite the difficult conditions, thanks to USDEC programs designed to build long-term demand.

For instance, South Korea is one market where U.S. dairy has enjoyed recent success. Last year, U.S. cheese exports to South Korea increased 56 percent, to almost 29 million pounds, Speich reported, and it has become our second-largest export market for cheese.

Last fall, we scored a success with string cheese, she said. A Korean cheese importer introduced U.S. string cheese in two of the nation’s largest convenience-store chains. After initial success, two more large chains added the product. As a result, U.S. string cheese quickly became the second-largest selling dairy product in the entire Korean c-store channel, according to Speich.

“This success didn’t come by accident,” Speich warned. “USDEC and the U.S. cheese supplier had built a relationship with the Korean importer over several years. The buyer had built a profitable business selling U.S. cream cheese to Korean bakeries and just a year earlier they had introduced single-serve cream cheese packs in convenience stores.”

“It was this long-term relationship with both USDEC and the cheese maker that was key to getting the string cheese project off the ground,” she concluded.

This Week in Dairy Profit Weekly

1) Outlook:  USDA’s Ag Supply and Demand Estimates report lowers the 2009 milk production forecast to 187.8 billion lbs., and raises the 2009 milk price forecast 50¢-60¢/cwt., with an average price of $11.85-$12.35/cwt. USDA forecasts a Class III milk price average of $10.65-11.15/cwt., while the Chicago Mercantile Exchange Class III futures price average at the close of trading on April 9 was about $12.55/cwt.

2) California : California ’s May Class 1 milk price is $12.68/cwt. for the North, up $1.10 from April, but $6.10 less than May 2008. The Southern price is $12.96/cwt., up $1.11 from April, but $6.09 less than a year ago. The federal order Class I base price will be announced April 17.

3) rbST: A 44-page opinion and order by U.S. District Judge James Graham, issued on April 3, details a decision denying an injunction sought by the International Dairy Foods Association and Organic Trade Association regarding an Ohio milk labeling rule. In Kansas , a bill containing provisions similar to the Ohio labeling rule was approved by both houses of the state legislature. And, the Oregon Physicians for Social Responsibility, which has coordinated a nationwide campaign opposing use of rbST, said more than half of the nation’s 100 largest dairies have completely or partially discontinued accepting milk from cows supplemented with rbST.

4) Federal orders: USDA will hold a national public hearing, May 4, in Cincinnati , on proposed changes to producer-handler provisions in all federal milk marketing orders.

MILC Payment Rates and Projections
(April 9, 2009) Here is the MILC projections, updated through the end of this week. Feed prices are up, which is raising the MILC target over the next several months.

If these increases continue, they could have a substantial impact on the MILC rate through the spring.
                                               
        MILC Payment Rates and Projections             
        Year    Boston Class I  Payment        
                Actual  Target  Rate           
        FY 2009                                
        October '08     18.78   18.48   0.0000         
        November        20.58   18.10   0.0000         
        December        18.68   17.76   0.0000         
        January '09     18.99   17.98   0.0000         
        February        13.97   17.33   1.5135         
        March   12.68   17.23   2.0487         
        April   13.61   17.00   1.5263         
        May     13.93   16.94   1.3526         
        June    14.08   17.04   1.3298         
        July    14.76   17.04   1.0222         
        August  15.84   17.17   0.5989         
        September       17.19   17.14   0.0000         
        FY 2010                                
        October '09     18.00   17.31   0.0000         
        November        18.34   17.31   0.0000         
        December        18.40   17.32   0.0000         
        January '10     18.38   17.50   0.0000         
        February        18.41   17.50   0.0000         
        March   18.42   17.50   0.0000         
        April   18.42   17.62   0.0000         
        May     18.78   17.62   0.0000         
        June    19.01   17.72   0.0000         
        July    19.08   17.72   0.0000         
        August  19.57   17.66   0.0000         
        September       20.09   17.65   0.0000         
        Projections based on futures as of 4/9/2009      

Roger Cryan,Vice President, Milk Marketing & Economics
National Milk Producers Federation

Producer-Handler Debate Illustrates How The Dairy Industry Has Changed
(April 10, 2009) Commenting on the announced hearing regarding the producer handler status in Federal orders, Dairy Profit Weekly editor, Dave Natzke, said in his weekly Friday report that the debate “illustrates is how the dairy industry has changed.”

Decades ago, a producer-handler was like his grandfather who milked 25 cows and had a door-to-door milk-delivery business. A majority of today’s producer-handlers are still relatively small, Natzke said, but USDA estimates the average business handles about 1.4 million pounds, or about 163,000 gallons of milk, per month.

“While producer-handlers face additional business risks, because they essentially buy milk from themselves,” Natzke reasoned, “They can avoid paying the federal order Class I differential, which, depending on location, can range anywhere from $1.70-$3.60 per hundredweight.  That's money not shared by farmers regulated by the federal order system.”

Also brought to light in this debate, according to Natzke, are 2008 Farm Bill requirements to speed up the federal order rule-making process. There have been times when USDA has taken a long time, in some cases years, to act on federal order proposals. National Milk petitioned USDA for producer-handler changes in late January, so the rule-making process appears to be on a relatively fast track, Natzke said.

Meanwhile; with high input costs and low milk prices, it's been a rough economic stretch for dairy farmers, Natzke said. However, USDA’s latest World Agriculture Supply and Demand Estimates report “provides a small glimmer of light at the end of the tunnel.”

Citing the recently announced Cooperatives Working Together herd retirement program and other herd liquidations due to poor economic conditions, USDA lowered its 2009 forecast for both cow numbers and total milk production.

With less production, USDA raised its milk price forecast 50-60 cents per hundredweight. The latest forecast puts the average price at between $11.85 and $12.35 per hundredweight, which would be at least $6 less than the 2008 average.

USDA forecasts a Class III milk price average $10.65-11.15/cwt., while the Chicago Mercantile Exchange Class III futures price average as of April 8 was about $12.57.

Dairy Farmers Plan Rally Tuesday in Des Moines
(April 10, 2009) Dairy farmers in Des Moines, Iowa will stage a grassroots rally to call attention to financially-struggling producers across the country.

One of the rally’s organizers, Dave Knipper, a local AI technician, told DairyLine that many of his customers are having to borrow money to pay monthly feed bills and stay in business and he hopes the rally will attract the attention of consumers and politicians.

The rally will take place at the Capitol in Des Moines Tuesday morning at 11AM and will feature a variety of speakers.  

Dairy Markets Weekly Recap
(April 10, 2009) The cash dairy markets were mixed in the Good Friday holiday shortened week. Block cheese closed Thursday at $1.2350 per pound, down 4 1/2-cents on the week, and 60 cents below a year ago. Barrel closed at $1.17, down 9 cents on the week and 58 cents below a year ago. Twenty one cars of block traded hands on the week and 17 of barrel.
        
Cash butter strengthened, likely driven by last minute Easter/Passover demand, and closed Thursday at $1.2050, up 2 1/2-cents on the week, but still 18 1/2-cents below a year ago. Nineteen cars were sold.

Milk Production Estimate Lowered for 5th Month in a Row
(April 9, 2009) The Agriculture Department has lowered its milk production estimate for the fifth month in a row. Department bean counters, in this morning's World Agriculture Supply & Demand Estimate report, now project 2009 output to be 187.8 billion pounds, down from 188.5 billion projected a month ago. 2006 output was 190 billion.

Cow numbers for 2009 were lowered as producers are expected to “liquidate herds in response to poor returns.” It suggests that the recently announced CWT herd removal will encourage a more rapid reduction in cow numbers.

Milk per cow growth has slowed from last month, according to USDA, also reflecting poor returns. Import forecasts were unchanged from last month however commercial exports were lowered due to reduced butter exports. Government price support removal projections were also reduced as “strengthening prices through the year will result in lower sales to the CCC.”

Milk price estimates were raised for 2009. The Class III benchmark is now projected to average $10.65-$11.15 per hundredweight, up from $10.05-$10.65 projected a month ago. That’s still a long ways from the 2008 average of $17.44. The Class IV price is projected at a range of $9.95-$10.55, up from $9.50-$10.20 expected a month ago, and compares to $14.65 in 2008.

Hearing on Modifying Producer-Handler Provision in Federal Order Milk Markets
(April 8, 2009) The Agriculture Department will hold a hearing requested by National Milk and the International Dairy Foods Association to consider modifying the producer-handler provision in Federal order milk markets.

NMPF's Chris Galen reported in Thursdays DairyLine that, as dairy farms have grown, some have begun to bottle their own milk and those plants have grown so large that they resemble privately owned but commercial operations. He warned that they have the potential to disrupt orderly milk marketing orders, particularly because they don't have to pay into the Class I pool that other handlers have to pay into so they're reducing the blend price paid to other dairy farmers and, at the same time, take markets away from, in many cases, farmer-owned bottling operations.

USDA will consider a variety of proposals at a May 4 hearing in Cincinnati so this is good news, according to Galen, because, given the trends in the dairy industry regardless of the fact that prices are low right now, but given the fact that we could certainly see more producer-handlers in the future, we feel that the largest of them, and these regulations would only affect a handful of the very largest producer-handlers, the largest of them need to be regulated in the same way that we have minimum pricing and pooling regulations applied to bottling plants of the same size.

Another story out of Washington concerned the Food and Drug Administrations 60-day delay in implementing the so-called enhanced BSE feed ban. This regulation would make it much harder for renderers to dispose of dead stock because of concern that those animals could transmit BSE.

Were already seeing the rendering options for cattle producers in a variety of places around the country being limited, Galen charged.

NMPF has complained to the FDA about this and their response was to give another 60 days before the regulation becomes final but Galen said It doesn't look like the FDA has any kind of acknowledgement or recognition that the real problem is that you cant easily dispose of a 1400 pound animal, whether its composting, burying, burning, this delay of two months just kicks the can down the road but it doesn't  necessarily get at the heart of the issue which is, if you cant  render these very large cattle, how do you dispose of them in an environmentally sensitive manner. Related Link

Reporting in Wednesday's DairyLine, Dryer said food service sales are very good. There are signs that the restaurant business is lagging because of the recession, he admitted, but the cheese friendly side of the restaurant business is doing pretty well, such as the McDonalds, Hardys, and Carls Juniors of the world and, while same store sales are below a year ago, they're still selling less expensive items off their value menus which are full of cheese.

Dairy exports are also down, he said, but not as much as a lot of people expected and Dryer expects recovery as the year progresses.

Retail cheese sales are very strong, according to Dryer, and for the three months of December, January, and February, natural cheese sales were up 4.4 percent from a year ago as more people spend more time eating at home.

This has also helped fluid milk sales and Dryer reports that retailers have aggressively promoted fluid milk and, in this kind of economy, cheese moves to the center of the plate. You have a grilled cheese sandwich or macaroni and cheese or other casseroles with cheese so its good for demand.

The category that's struggling is pizza and Dryer explained that pizza people haven't been very innovative or aggressive for a couple of years now. DMI has a cooperative effort with Dominos new line of pizza that has 40 percent more cheese on it, Dryer said, and hopefully that works well but there has to be some support for that and its going to take a little time to change peoples minds because they're so used to getting mediocre pizza from a lot of the chains.

Positive News From Dairy Products Report

(April 6, 2009) California dairy producer and Dairy Management Incorporated board member, Steve Maddox, was back on Monday's DMI Update and discussed check off sponsored export market development. The program aids in developing dairy products that are more in line with what overseas consumers want and, in the desired packages, according to Maddox, and through the U.S. Dairy Export Council (USDEC) we are able to educate and facilitate U.S. processors in developing those products.

The effort was so successful that 97 percent of 2007 exports were unsubsidized, according to Maddox. Prior to that, almost 100 percent had to be subsidized, he said, and in 2008, 11 percent of U.S. milk production went to exports.

Things are slower this year, he admitted, but We have our foot in the door, foreign consumers want our products, but right now, with the financial crisis, they're trying to find the money to buy them, but they still want us there.

We have to learn how to deal with that, he said, and We have to further develop those markets so were there, day in and day out. He stressed the importance of exports, Especially when we can export value-added products and clear some of our supply, yet get its true value.  

Nonfat dry milk output amounted to 123 million pounds, down 31.8 million or 20.6 percent from January, but 4.7 million or 4 percent above a year ago.

Mozzarella cheese output totaled 247.5 million pounds, down 20.6 million pounds or 7.7 percent from January, and 17.8 million or 6.7 percent below a year ago. Adjusted for leap day, Mozzarella output was down 3.4 percent.

Total Italian type cheese, at 320.3 million pounds, was down 27.6 million pounds or 7.9 percent from January, and 14.7 million or 4.4 percent below a year ago.

Cheddar production totaled 240.4 million pounds, down 33.7 million pounds or 12.3 percent from January, and 10.9 million pounds or 4.3 percent below a year ago. Adjusted for leap day, Cheddar output was off 0.9 percent.

American type cheese amounted to 319.4 million pounds, down 33.8 million pounds or 9.6 percent from January, but unchanged from a year ago.

Total cheese output came to 768.5 million pounds, down 55.5 million pounds or 6.7 percent from January, and 16.1 million or 2.1 percent below a year ago. Adjusted for leap day, total cheese output was up 1.4 percent from 2008.

Cash Dairy Markets Weekly Recap
(April 3, 2009) The cash dairy markets saw little change the first week of April. Block cheese ended Friday at $1.28 per pound, down a penny on the week and 53 1/4-cents below  a year ago. Barrel closed Friday at $1.26, down 3 3/4-cents on the week and 49 1/2-cents below a year ago. Seventeen cars of block traded hands on the week and 11 of barrel. The NASS-surveyed U.S. average block price gained 1.6 cents, hitting $1.2379. Barrel averaged $1.3173, up 4.1 cents.
 
Butter ended the week at $1.18, down three quarters of a cent, and 19 1/4 cents below a year ago, while the NASS average was up 0.9 cent, at $1.1695. Six cars were sold on the week. NASS nonfat dry milk averaged 81.52 cents, down 0.3 cent. Dry whey averaged 17.45 cents, up 0.2 cent.
 
Uncle Sam purchased 4 million pounds of nonfat dry milk in price support purchases this week, raising the cumulative total to 209.4 million, compared to none a year ago.

Looking ahead; Class III futures settled Thursday as follows: April $11.01, May $11.40, June $12.24, July $13.37, and August at $14.46, with the peak at $15.23 in November. Contrast that to the 2008 peak of $20.25 in June.

The NASS-surveyed cheese price averaged $1.2611 per pound, up 10.9 cents from February. Butter averaged $1.1289, up 5.4 cents. Nonfat dry milk averaged 81.66 cents, down slightly from 82.15 cents, and dry whey averaged 16.62 cents, up almost a penny from February.

USDA issued its annual Prospective Plantings report this week, the first sign of how many acres of major crops will be planted in 2009 and, based on early March surveys, U.S. farmers will plant about 85 million acres of corn, down slightly from last year. However, soybean acreage, at 76 million acres, will be up slightly. And, at about 60 million acres, more area will be devoted to dry hay this year, welcome news after last year’s record-high hay prices, according to Natzke.

USDA also released its Grain Stocks report, an indicator of how much corn and soybeans are currently in storage. That report shows corn inventories are up slightly, but soybean inventories are down about 9 percent from a year ago. 

Taken together, those reports indicate higher corn and soybean prices are ahead, according to Darrel Good, University of Illinois economist. That’s bad news for dairy farmers currently facing some of the lowest milk prices in years.

USDA’s monthly milk-feed price index, an indicator of milk income in relation to feed costs, was just 1.51 in March, virtually unchanged from February. An index of 3.0 is considered positive for dairy farmer income, but the milk-feed ratio hasn't been that high for 16 months.

With the 2008 Farm Bill, feed prices are now factored into federal Milk Income Loss Contract program (MILC) payments, paid to farmers when milk prices are low. With USDA’s final calculations for February feed costs, qualified dairy farmers will receive about $1.51 per 100 pounds of milk marketed in February. But, current milk and feed prices indicate the March MILC payment will be higher, possibly $2.00 per 100 pounds of milk.  

He looks for the Class IV price to come in at $9.66. That would be an increase of 21 cents from February but would be $4.51 below a year ago. We will post official prices here as soon as possible.

CWT will conduct its seventh herd removal
(April 2, 2009) The farmer-funded, voluntary self-help Cooperatives Working Together program (cwt) announced this week that it will conduct its seventh herd removal. Bids will be accepted from CWT members until May 1, 2009.  

National Milk’s Chris Galen, in Thursday’s broadcast, called it “another good sign in the marketplace that things are being done to help bring the supply/demand imbalance, which is creating these very low milk prices, back into balance.” He said they expect a lot of interest, given where milk prices are right now.

Galen also praised the USDA’s decision to move 200 million pounds of nonfat dry milk out of storage into domestic feeding programs and “Both will hopefully change the psychology of the dairy markets and give producers hope that both the government, in this case the USDA, as well as CWT, stand ready to use the resources they have at their disposal to help dairy farmers out.”

No word has been given yet from USDA regarding resurrecting the Dairy Export Incentive program but Galen pointed out that Agriculture Secretary Tom Vilsack did mention it as something he is looking at.

Galen said we have to give him credit for “a good start but hopefully, this will be just one in a series of steps that the government can take to help do something about dairy prices and CWT will be removing cows, starting in May and that will also help reduce the flow of milk into the commercial channels this spring.”

The value of cows and heifers has dropped significantly in the past six months. When asked what impact that might have on the incoming bids, Galen answered, that the CWT’s flat fee for bred heifers is $700 per head, down considerably from the last herd removal. The average bid is expected to be significantly lower, he said, because cow values are down and “We’re not going to pay extravagant prices for cows, particularly at a time where the overall value for these animals has really dropped.”  

The School Lunchroom Has Changed Since We Were There
(April 1, 2009) Miriam Erickson Brown, President and CEO of Anderson Erickson Dairy in Des Moines, Iowa testified Tuesday before the Senate Committee on Agriculture regarding the need for one set of standards to cover foods sold in schools. She represented the International Dairy Foods Association and National Milk and reported highlights in the “Processor’s Perspective” in Wednesday’s DairyLine.  

Brown said she reminded Senators that the school lunchroom has “changed since we were there.” Today there are a la carte menus, vending machines and school stores that provide an array of food. Yet, only the school meal program is required to adhere to the Dietary Guidelines for Americans, which assures that our kids are getting the nutritious foods they need. 

“There should be a range of healthy dairy products available in schools,” Brown said, “including white, lactose-free, and flavored milk as well as yogurt and cheese and it is important to develop school-wide standards that recognize their nutritional value.”

She also asked the committee to be sure to balance nutrition standards with what kids will eat. Foods that are good for you must also taste good, she said, and she gave yogurt as an example of such a popular choice with kids.

One six-ounce carton of yogurt contains as much protein as one large egg and less fat than a quarter pound of lean ground beef, according to Brown, adding that, “Flavored milk is great way to encourage children to drink low-fat and fat-free milk.”

Anderson Erickson’s fat-free chocolate milk has only 140 calories per eight ounce serving, she said, “So we need to make sure that our standards don't restrict sugar levels too far or they could actually limit the availability of this nutrient-rich favorite.”

Brown talked about the importance of dairy foods as an ingredient as well. She testified that the most popular and nutritious dishes served in schools today include cheese, things like pizzas, quesadillas, and pasta. 

Not only is cheese a great source of calcium and protein, Brown said, but it often encourages kids to eat other healthful foods such as vegetables and whole grains, and a wide variety of cheeses are available today, including tasty reduced-fat varieties. 

In conclusion, Brown said she assured the Senators that the dairy industry is “committed to providing new products, new flavors, and new ways for students to enjoy the taste and goodness of dairy products.”