April 2010 Archived Dairy News
April 30, 2010
April Ag Prices Report
Dairy Market Weekly Recap
April Federal Order Benchmark Milk Price Inches Up 14 Cents
Trade Dispute With China Threatens To Slow Dairy Price Recovery
Kagen
Says Trade Deal Could Make or Break U.S. Dairy Industry
Allegheny
couple files lawsuit against Pasture Maid Dairy
Dairy
Business Milk Marketing Cooperative Okayed By USDA
Dairy
panel meets for first time; farmers want help now
Got
Milk? Not if it isn't dairy
MD:
Local teen a national finalist in $30,000 dairy competition
Australia:
Dairy company shuts plant and expands another
April 29, 2010
Hardesty
new USDEC chairman
Crackdown on Misuse of Dairy Terms
FDA Should Stop
Imitation
Products
Cal
Poly Dairy Supporter Update
Update: Dairy Farmers’
Movement for Change
What's
Your Energy Appetite
Letter
to the editor: Gretchen Maine
Letter
to the editor: Linda Broyan
Letter
to the editor: Loren Lopes
Dairy
cows get quality care
Got
milk? Only if it comes from a cow, group argues
Raw
milk may soon be available
Dairy
cows tweet via RFID
PA:
Dairy Princess candidates wanted
St.
Paul junior selected as dairy princess/ambassador
Volcano
takes toll on Iceland farmers
April 28, 2010
The Importance of Farmers Telling Their Story
MPCA
closer to shutting down Thief River Falls dairy
WI:
DNR close to agreement on fee increase for new factory farm
pollution permits
Livestock
Lawsuit: Dairy farm gets millions for shocked cows
MI:
$4.5 Million Paid to MMPA Members
Idaho
Dairy Products Commission seeks nominations
Dairies
can expect more cottonseed
IDFA
Calls on U.S. Leaders to Intervene in Threatened Shut Out of
Exports
to China
Top
cheeses wheel through competition
Former
dairy princess endorsed by DFL for Governor
New
Zealand Dairy upswing already flowing to consumer
New
market study, "Dairy Food in Sweden to 2013"
Canada:
Group backs down from quota challenge
Thousands
of French Farmers Protest in Paris
April 27, 2010
Letter to the
Editor - Dave & Robin Finch
Dairy Checkoff Update - April 2010
We Have A Lot Of Cheese Out There
Excel
Dairy hearing set for Tuesday in St. Paul
ND dairy
business getting milked dry
Cattle
not at fault for greenhouse gases
Fonterra announces
increase in milk price
April 26, 2010
Cropp:
Dairy Market Behavior Not Easy to Explain
Having
cow hard work, but very rewarding
Western
United Dairymen weekly update
Milk
Producers Council weekly update
This Week in Dairy Profit Weekly
Latest FAO Report Good News For Dairy
Understanding
how cattle think can help handlers, veterinarian says
Farmers
hopeful, but unhappy over present
Study
shows feed, not cows, major air-pollution source
Ohio:
ODA reschedules Open House and Public Meeting on Van
Deurzen Dairy
Lessons
in agriculture
Mooving
tribute for Beef Week
Changing
the rule book on corporate mergers
April 23, 2010
May Federal Order Class I Price Up 58 Cents
Legislative
Session Ends: Raw Milk Okayed, Energy/Jobs Act Dies
A Lot of "Hot Air" Related To Dairy Industry's Role in Climate Change
The
Federal Milk Marketing Improvement Act of 2009
Study: Cow
feed may be causing Valley air problem
2011 International Dairy Show
April 22, 2010
March Cold Storage Report
Foundation For The Future Program
Related
Dairy
Farmers Hope For Mandatory, Instant Pricing System
Canadian
milk and milk products interesting facts
N.L.
backs dairy for manure digester system
April 21, 2010
Pressure On The Cheese Market May Not Go Away Soon
Dairy Outlook
Dairy
Industry Advisory Committee Has First Meeting
House
Ag Committee Conducts Dairy Hearing
Dairy
supports debated as work starts on farm bill
Legislators,
dairy farmers discuss risk management measures in future Farm Bill
Cornell
Team Takes Top Prize in Dairy Competition
"Josie"
the Cow Helping to Feed the Hungry
UK:
Dairy farm plan for 8,100 cows is shelved
April 20, 2010
More Milk Will Be Coming On Line
Penn State April
Dairy Outlook
CWT Accepts Bids For 4.5 Million
Lbs. of Cheese Exports; Expands Eligible Product List
Voting Now
Open: America's Farmer Mom of 2010
Welch
unveils legislation to curb volatility in milk prices
Dairy
Price Stabilization Act Would Calm Prices
Speaker
Lineup For 2010 Outlook Conference
April 19, 2010
March Milk Production Up 0.9 Percent
U.S. Cheese Exports Are Coming Back
Welch
unveils growth plan for dairy industry
Alliance
of Western Milk Producers update
Milk Producers Council Weekly Update
This Week in Dairy Profit Weekly
Vilsack to
Dairy Committee: ‘There Is a Lot at Stake’
Watahala
Farms: Last commercial dairy standing in Alleghany County
Cow-Chips-to-Power
Company Sues Idaho
Touchet
dairy feeds cows only grass
Senate
moves raw milk legislation along
Raw
milk supporters stand strong amid tough scrutiny of product
With
retirement approaching, Cornell Co-op's Lehman looks back
Over $20,000 to be awarded in
the 2010 World Forage Analysis Superbowl
Registration Now Open
for 2010 International Dairy Show
April 16, 2010
Dairy Market Weekly Recap
Dairy trade is one of the positive aspects of the dairy economy
Chicago
Milk Traders Hold Sour Outlook Despite Butter Price Surge
Dairy
Industry Advisory Committee - USDA Website
Trade
rep may bring dairy into discussion
California
dairies find greener grass
ID:
Dairy farmers backed into a corner as costs rise, prices fall
IL:
Wal-Mart reduces dairy business with Prairie Farms
MN: Senator Franken Asks
For Help For Dairy Farmers
WA:
Officials seek cause of Snohomish dairy-manure spill
WI:
Kuehn Dairy Farm to host event commemorating the 40th Earth Day
Dairy
producers say robotic milkers work for them
Veterinarians
make house calls for cow herd checks
Dairy
commercial shows Portsmouth High School students 'Got Milk'
April 15, 2010
Mid-Week Milk Production Update
Producers Will Receive About $30 Million in MILC Payments this Year
USDA
Schedules First Meeting of Dairy Industry Advisory Committee for
April 13-15
CA Dairy Council offers tool to industry
Google
Fiber flavor ice cream unveiled
Auction participants believe
in dairy’s future
Kraft
Launches New Mac & Cheese Variety With a Bang
Inspector
General seeks tighter residue monitoring for cull dairy animals,
veal
90,000
guinea heifer breaks sales record
April 14, 2010
Colorado Dairy Producer Endorses Beef Checkoff
WA:
Big manure spill at dairy flows into Snohomish River
Weld
County mulls lawsuit over vehicle tests
Iowa
seizing on golden opportunity
Ganeden
Biotech, Guernsey Farms Dairy Introduce New Probiotic Milk Line
Florida
Departments of Agriculture and Education Join "Fuel Up to Play
60"
Firefighter
killed in silo explosion on NY farm
Aurora
Organic Dairy Named Best Fluid Milk Plant
Dairy
exec hopes to moooove Larson out
Babcock
Institute Helps Build Dairy Industry in Turkmenistan
Wind
project generates heat
WY:
Officials order raw milk pulled
40%
of New Zealand's dairy herds are now in drought declared zones
April 13, 2010
Market Analysis With Dr. Robert Cropp
Idaho
dairies struggle to hang on
Bovine
Calving Management: Impact Of Dystocia On Dairy Calves & Cows
New
dairy regulations subject of NM water commission hearings
WI
Students Earn Top Placings at Dairy Challenge Competition
NFL
& dairy farmers lead anti-obesity campaign
IDFA
Lauds Healthy Milk, Dairy Choices in Schools Act
April 12, 2010
California May Class 1 Prices Announced
Slightly Higher May MILC
Payment Rate Projected
States
woo Calif. dairymen with less regulation
Hundreds
gather in Madison to promote raw milk sales
Sales
of raw milk should get trial period
Dairy
groups push legislation
DMI Update
Western
United Dairymen weekly update
Milk
Producers Council weekly update
Dean
Foods Antitrust Case Over WI Plants Will Go Forward
Milk
temperature becomes an issue
DNA
markers offer a new viewpoint for US dairy breeding industry
Canada:
For Sale - One Farm
FDA
Says Indiana Dairy Misused Antibiotics
Fire at
NY dairy farm kills 104 cows We
Will Rebuild
April 9, 2010
Dairy Market Weekly Recap
ASDE: Milk Production Estimate Raised Again
Several Proposals To Create Supply Management Progam
Judge
denies Dean Foods' motion to dismiss antitrust case
Cross
Country: Chapman Brothers Dairy bucking trend of family farm loss
22 Cows
Die in Barn Fire
April 8, 2010
Time For Balance, Not Balancing Jerry
Kozak, NMPF
Wisconsin
farmers struggling for needed loans
Democrats
back tax credits for companies, farmers
MN:
Budget balancing bill cuts agriculture by $7 million
Dean
Foods Antitrust Case Over WI Plants Will Go Forward
USDEC
Applauds the Successful Brazil Cotton Dispute Negotiation Outcome
Biographies
of the candidates from the WMMB 2010 elections
Canada's
first eco-dairy set to launch
Remembering James
Francis Cavanaugh
April 7, 2010
Be Prepared
Mid
Sized Dairies Wins Consumers
Export
outlook holds promise for dairy farmers
Idaho
regulators approve contract for electric utility
Dairymen
talk recovery plans at Ohio conference
April 6, 2010
Market Talk with Alan Levitt
Local
milk venture backers confident
Research
to Benefit Dairy Industry Worldwide
Milk
Moustache Tour Touts Benefits of Family Meals
About
100 cows die in Frederick fire
Key
nutrient information helping increase dairy farm efficiency
From Cow to
Can: WSU's Homegrown Cheeses
Relation
Flooring Systems and Mastitis in Dairy Cows
Fonterra
plans new milk plant on NZ South Island
April 5, 2010
CWT
Helps Members Export 3.5 Million Pounds of Cheese
Idaho Dairy Focus -
April 2010
CO:
Dairy loans sold, but future's unsure
Alliance
of Western Milk Producers update
Open Meeting with
Congressman Costa in California at Maddox Dairy
Western
United Dairymen update
Milk
Producers Council update
NY Dairy
Farmers Voice Milk Pricing Complaints
ME:
Reporter gets a handle on quality checks at Oakhurst
Cows
die in farm shed fire near Gilman
Farm
Technology Days completes grant program
Water
rights legal battle is very important for local dairy farmers
National
dairy competition coming to Visalia
I Keep My Cows Comfortable
Hunterdon
County dairy princess gets in the game
April 2, 2010
March Federal Order Benchmark Milk Price Drops $1.50
Good News For Future Dairy Feed Prices
Editorial:
Let's not throw the baby out with the bath water
Oregon's
agriculture sales wither
Cross
Country: Oshkosh farm show a 'must-see' event for farmers
New
Farmstead Dairy Equipment Company Opens in South Royalton, Vermont
Dr.
Harold Farrell presented the William C. Haines Dairy Science Award
April 1, 2010
February Dairy Products Report
Milk Feed Price Ratio is 2.26
New Research Challenges Assumptions Regarding Global Warming and Agriculture
Dairy
farmers talk of industry on verge of collapse
Vermont
dairy summit talks of milk production limits
Animal
ID needs to move forward
Wet
spring could lead to increase in mastitis
IA:
AE Dairy employee dies in accident
Winchester
dairy farm to pop hazardous gas bubbles in manure lagoon
Seventy-six
Groups Push USDA to Get Tough on Canadian BSE
April Ag Prices Report
(April 30, 2010) The April Milk-Feed Price Ratio is 2.15, down
from March's revised estimate of 2.19, according to USDA’s
“Ag Prices” report issued Friday, and compares to 1.59 in
April of 2009.
The All Milk Price was estimated at $14.60 per
hundredweight, down 20
cents from last
month's estimate, but $2.70 above a year ago.
Corn averaged $3.51 per bushel, down 4 cents from March, and 34 cents below a year ago. The soybean price, at $9.48 per bushel, was up 9 cents from March, but 31 cents below a year ago. Alfalfa baled hay was $113.00 per ton, up $2.00 from March, but $18.00 below a year ago.
Dairy Market Weekly
Recap
(April 30, 2010) Cash dairy trading didn’t see a lot of change the last week
of April but the block cheese price closed 2 cents higher, at $1.3875 per pound,
23 1/2-cents above that week a year ago. Barrel closed Friday at $1.38, up 3
1/4-cents on the week, and 29 1/4-cents above a year ago. Only two cars of block
traded hands on the week and one of barrel. The U.S. average, NASS-surveyed
block price gained 4.7 cents, hitting $1.4384. Barrel averaged $1.4209, down 1.2
cents.
Butter
closed Friday at $1.62, up a nickel on the week, and 39 cents above a year ago.
Nothing was sold. NASS butter averaged $1.5153, up 2 cents.
Grade A and Extra Grade nonfat dry milk closed unchanged on the week at $1.2975 and $1.25 respectively. NASS powder averaged $1.1774, up 3.4 cents, and dry whey averaged 35.23 cents, down 1.2 cents.
April Federal Order Benchmark Milk Price Inches Up 14 Cents
(April
30, 2010) The April Federal order benchmark milk price inched 14
cents higher Friday, to $12.92 per hundredweight. That’s $2.14
above April 2009 and pulls the 2010 average up to $13.62, up
from $10.33 at this time a year ago, but compares to $17.78 in
2008. Futures price portend more gains to come. The May contract
settled Thursday at $13.42, June $13.95, July $14.52, August
$15.00, with a peak of $15.10 in September before heading back
down seasonally. The April Class IV price is $13.73, up 81 cents
from March, and $3.91 above 2009.
The
NASS-surveyed cheese price averaged $1.3827 per pound, up 2
cents from March. Butter averaged $1.4773, up 3.9 cents. Nonfat
dry milk averaged $1.1208, up 7.5 cents, and dry whey averaged
36.43 cents, down 1.2 cents. California’s comparable 4a and 4b
price are issued May 3.
|
CLASS & COMPONENT PRICES: |
|
COMMODITY |
April 2010 | March 2010 | Feb 2010 |
|
Class II Milk Price |
$13.78 cwt. | $14.46 cwt. | $15.65 cwt. |
|
Class II Butterfat Price |
$1.5883 lb. | $1.5417 lb. | $1.4474 lb. |
|
Class III Milk Price |
$12.92 cwt. | $12.78 cwt. | $14.28 cwt. |
|
Class III Skim Price |
$7.65 cwt. | $7.68 cwt. | $9.57 cwt. |
|
Class IV Milk Price |
$13.73 cwt. | $12.92 cwt. | $12.90 cwt. |
|
Class IV Skim Milk Price |
$8.49 cwt. | $7.82 cwt. | $8.14 cwt. |
|
Butterfat Price |
$1.5813 lb. | $1.5347 lb. | $1.4404 lb. |
|
Nonfat Solids Price |
$0.9435 lb. | $0.8688 lb. | $0.9043 lb. |
|
Protein Price |
$2.1449 lb. | $2.1311 lb. | $2.7066 lb. |
|
Other Solids Price |
$0.1702 lb. | $0.1823 lb. | $0.1992 lb. |
|
Somatic Cell Adjustment Rate |
$0.00069 per 1,000 cells | $0.00068 per 1,000 cells | $0.00076 per 1,000 cells |
| PRODUCT PRICE AVERAGES | Jan 2010 | March 2010 | Feb 2010 |
| Butter | $1.4733 lb. | $1.4388 lb. | $1.3609 lb. |
| Nonfat Dry Milk | $1.1208 lb. | $1.0454 lb. | $1.0812 lb. |
| Cheese | $1.3827 lb | $1.3632 lb. | $1.5110 lb. |
| Dry Whey | $0.3643 lb. | $0.3761 lb. | $0.3925 lb. |
(April
30, 2010) A
dispute with China threatened to slow dairy price recovery,
according to Dairy Profit
Weekly editor Dave Natzke. Speaking in Friday’s broadcast,
Natzke reported that a
small but growing market for U.S. dairy exports could be closed
as early as May 1, after Chinese officials abruptly said they
would no longer accept terms of a 2007 agreement. However,
Friday they agreed to give the U.S. 30 days to work with
authorities to secure an agreement on a new health certificate
for food-grade dairy exports to China.
On
April 22, the Chinese government informed U.S. officials it
intended to block imports of U.S. dairy products due to alleged
deficiencies in “export certification.” In negotiations for
the 2007 agreement, China had requested certification statements
regarding animal health issues, which the USDA said were
unnecessary for dairy products made from pasteurized milk. China
eventually signed the English/Chinese USDA Agricultural
Marketing Service (AMS) Sanitary Certificate agreement without
that language. However, in last week's letter, China apparently
retracted that decision.
The
value of 2008 U.S. dairy exports to China totaled about $180
million, or about 5 percent of the record $3.8 billion in dairy
products exported that year. According to the U.S. Dairy Export
Council, primary products were whey proteins, milk powders and
lactose. As of late this week, U.S. officials hoped to
avert the trade blockade, or at least request an extension to
the May 1 deadline, so negotiations can continue.
May
could also be a pivotal month for the future of any federal
dairy policy reforms, according to Natzke. A team of economists
are evaluating the economic impact of policy proposals,
including several supply or so-called growth management plans,
on dairy farmers.
Meanwhile, a spokesman for California U.S. Rep. Jim Costa said the congressman is close to introducing a dairy supply management bill in the House. And, the Dairy Policy Action Coalition said a bill to fund mandatory, daily price reporting of dairy product sales is also advancing. Finally, the National Milk Producers Federation is expected to provide details of its Dairy Producers Income Protection Program in May.
Crackdown on Misuse of Dairy Terms(April
28, 2010) National Milk is renewing its call on the Food and
Drug Administration to crack down on the misuse of dairy terms
like milk, cheese, and yogurt by imitation products made from
soy, rice, almonds, and hemp.
Chris
Galen reported Thursday that in 2,000, NMPF sent a petition to
the FDA asking them to crack down on processors who used dairy
specific terms, primarily milk with “things that don’t got
milk.”
The
Federation predicted that, if the FDA did not do this, there
would be a proliferation of those labels and other products and
“sure enough 10 years later,” Galen said, “We’re seeing
soy cheese, hemp milk, and non dairy ice cream.”
He
pointed out that there are standards of identity in place and
“If you use terms like ice cream, cheese, yogurt, or milk,
they must be made from dairy milk, milk from the lactation of an
animal. You can’t make dairy products out of hemp or rice or
soy.”
Galen
reported that they received no response in its initial call on
the FDA, calling it “very frustrating because we felt that we
had a good case and we still feel, 10 years later, that we have
a good case here, in fact we have a better case because we’re
seeing a bevy of new artificial dairy products reaching store
shelves that have imitation products made from hemp, rice,
almonds, and other plants, legumes, and vegetables. He added
that, in some cases marketers create new words like cheese,
spelled with a V instead of an S “in an attempt to skirt the
standards of identity.”
This isn’t just a labeling issue, according to Galen, because a lot of these products do not have the same nutritional level or value as real dairy products do and consumers of so-called rice or soy milk, think they’re getting the same vitamin and mineral content as real cow’s milk, don’t.
Related: FDA Should Stop Imitation Products
The Importance of Farmers Telling Their Story
(April
28, 2010) Seven Valleys, Pennsylvania dairy producer and Beef
Board member Joyce Bupp talked about the importance of farmers
“telling their story” in Wednesday’s DairyLine.
Bupp is in the process of completing the beef check off’s
“Masters of Beef Advocacy” program. She said the program is
designed to take information that farmers are very familiar with
everyday but don’t give a lot of thought to and put it into a
compiled, easy-to-read form that reinforces what farmers do. She
said it includes information on modern meat production, animal
care, beef safety, nutrition, and “things that consumers,
neighbors, and friends are interested in.”
She
acknowledged that there is an information gap among consumers
and said it’s sad because people are interested in what
farmers do and are supportive once they know but “there’s
such a disconnect of a lot of society today from agriculture
that they just don’t understand they’re and really hungering
for information.”
She
agreed to the importance of farmers telling their story before
someone else does it for them because “there are a lot of
organizations out there with agendas and large advertising
dollars.” She admitted that farmers don’t have a lot of
dollars but “we do have a lot of care and belief in our
industry, a lot of passion for what we do so it really behooves
us as producers to be ready to step up to the plate and educate
ourselves.”
The program “makes us more comfortable with what we’re talking about,” she said. “We know what we do but it just helps us to organize our thoughts and have some facts at hand and be better spokespersons for our industry.”
We Have A Lot Of Cheese Out There
(April
27, 2010) Cash
dairy trading was pretty quiet in the last Monday of April, with
block and barrel cheese inching a quarter cent higher on two
unfilled bids of each to $1.37 and $1.35 respectively, and
butter holding steady at $1.57 on one bid.
Downes-O’Neill
dairy economist Bill Brooks said in Tuesday’s DairyLine
that we have a lot of cheese out there and last week trading saw
the highest volume on blocks in a year but we may be starting to
bottom out as buyers feel comfortable about owning product,
according to Brooks.
Butter
wise, Brooks said we saw a pretty good run up, following the
heavy demand period of Easter but “we’re not seeing a great
deal of production come in even with the wide disparity between
Class III and Class IV prices and there’s still a lot of pent
up demand for future product. A lot of people want to own butter
right now, he said, in anticipation of tighter
supplies or export markets later on but right now it’s in a
“pause period while people evaluate whether the price is at
the right level or not.”
The
basic message from last week’s Cold
Storage report is that we still have a lot of cheese
relative to demand, Brooks said. We’re back over a billion
pounds, he said, a level achieved once last year but not since
1984 prior to that. We do consume a lot more than we did in
1984, he admitted, but we still have a healthy supply on hand,
35 days worth, the same as what we had at the end of February.
Butter
looks more promising, according to Brooks, with levels
comparable to a year ago or a 46 day supply but we have price
that’s 20-25 cents so it goes back to the anticipation of the
market and folks want to own product right now because they
believe that there’s going to be more prices increases later
on down the road that they can either take advantage of or they
don’t want to get hurt by.”
Latest FAO Report Good News For Dairy
(April
26, 2010) Dairy Management Incorporated’s Joe Bavido discussed
the U.N.’s Food and Agricultural Organization’s report on
Greenhouse Gas Emissions from the Dairy Sector in Monday’s “DMI
Update.” He said that the report states that approximately 4.1
percent of total global GHG emissions are related to the global
dairy sector. The figure includes emissions associated with milk
production, processing and transportation as well as the
emissions from meat production from dairy-related culled and
fattened animals.
“Considering
just global milk production, processing and transportation and
excluding meat production, the global dairy sector contributes
2.7 percent of GHG emissions, according to the new report,
Bavido said.
Bavido
called the report “good news for dairy because it is
significantly less than the 18 percent figure cited for
livestock agriculture in the November, 2006 report. The 18
percent number has been inaccurately attributed to dairy GHG
emissions, he said, “and dairy has taken some negative press
in regard to that.”
Bavido
also reported that work is underway at the Innovation Center for
U.S. Dairy to “build a foundation of credible data to help
tell consumers about the longstanding commitment of dairy
farmers and the dairy industry to the environment.” The Center
works with the University of Arkansas Applied Sustainability
Center and other experts to determine GHG emissions for U.S.
dairy, he said, beginning with a comprehensive life cycle
assessment for fluid milk. Preliminary research attributes an
estimated 2 percent of total U.S. GHG emission to U.S. dairy,
according to an Innovation Center press release.
Dairy Market Weekly Recap
(April 23, 2010) The block cheese price ended the third week of April at $1.3675 per pound, down 3 cents on the week, but still 18 3/4-cents above a year ago. Barrel closed at $1.3475, down 1 3/4-cents on the week, but 24 cents above a year ago. Fifty nine cars of block traded hands and 23 of barrel. The NASS U.S. average block price jumped 7.5 cents, to $1.3917. Barrel averaged $1.4330, up 7.3 cents.
Butter closed the week at $1.57, up a penny, and 34 3/4-cents above a year ago. Nothing was sold all week. NASS butter averaged $1.4958, up 2.1 cents.
Cash Grade A nonfat dry milk
closed Friday at $1.2975, up a half-cent on the week. Extra
Grade closed at $1.25, up 4 cents. NASS powder averaged $1.1428,
up 3.2 cents, and dry whey averaged 36.48 cents, up 0.2 cent.
May
Federal Order Class I Price Up 58 Cents
(April
23, 2010) The May Federal order Class I base milk price was
announced this morning by the USDA at $13.80 per
hundredweight, up 58 cents from April and $2.83 above May 2009.
That brings the year’s average to $14.25, up from $11.44 at
this time a year ago, but compares to $18.52 in 2008.
The
NASS-surveyed butter price averaged $1.4861 per pound, up 6.1
cents from April. Nonfat dry milk averaged $1.1250, up 7.9
cents. Cheese averaged $1.39, down 1.5 cents, and dry whey
averaged 36.36 cents, down 1.9 cents from April.
|
|
May 2010 | April 2010 | March 2010 |
| Class I Base | $13.80/cwt. | $13.22/cwt. | $14.34/cwt. |
|
*The Base Skim Milk Class I: |
$8.53/cwt. | $8.19/cwt. | $9.60/cwt. |
|
Class III skim: |
$7.69/cwt. | $8.19/cwt. | $9.60/cwt. |
|
Class IV skim: |
$8.53/cwt. | $7.82/cwt. | $8.69/cwt. |
|
**Butterfat |
$1.5920/lb. | $1.5179/lb. | $1.4515/lb. |
|
Class II Skim price: |
$9.23/cwt. | $8.52/cwt. | $9.39/cwt. |
|
Class II NFS price: |
$1.0256/lb. | $0.9467/lb. | $1.0433/lb. |
2-week Product Price Averages:
|
|
May 2010 | April 2010 | March 2010 |
|
Butter |
$1.4861/lb. | $1.4249/lb. | $1.4823/lb. |
|
NFDM |
$1.1250/lb. | $1.0459/lb. | $1.2701/lb. |
|
Cheese |
$1.3900/lb. | $1.4049/lb. | $1.5764/lb. |
|
Dry Whey |
$0.3636/lb. | $0.3821/lb | $0.3629/lb. |
(April
22, 2010) There's been a lot of “hot air,” If you'll pardon
the pun, related to the dairy industry's role in greenhouse gas
(GHG) emissions and global climate change but a new United
Nations’ Food and Agriculture Organization (FAO) report
counters some of that rhetoric, showing dairy contributes far
less to greenhouse gas emissions than what is widely cited by
anti-livestock groups.
Dairy
Profit Weekly
editor, Dave Natzke, said in Friday’s broadcast that much of
the ongoing greenhouse gas and global climate change debate
related to the livestock and dairy industries centers around a
2006 United Nation’s report, “Livestock’s Long Shadow –
Environmental Issues and Options” which claimed livestock
agriculture contributed 18 percent of the world's greenhouse gas
emissions, even more than emissions from all transportation.
Anti-meat
and milk groups have used those estimates to call for
"Meatless Mondays," Natzke said, and a reduction in
dairy product consumption as a means to “save the planet.”
However,
one of the authors of that earlier report has admitted
statistics were exaggerated, and this week, a new FAO report
estimates global milk production, processing and transportation
contributes just 2.7 percent of global greenhouse gas emissions.
And, if you add emissions related to meat produced from dairy
animals, the estimate is just 4 percent.
The
FAO report, Greenhouse
gas emissions from the dairy sector, focuses on the
entire dairy food chain, from feed production and on-farm
emissions, to emissions associated with milk processing and
packaging and transportation of dairy products to retailers.
Dairy industry leaders applauded the new information, saying it gives a more accurate assessment of dairy's greenhouse gas emissions, and helps identify the key areas where dairy research and industry organizations, such as the Innovation Center for U.S. Dairy, can work to drive greenhouse gas emissions even lower.
March Cold Storage Report
(April
22, 2010) March butter stocks totaled 196.6 million pounds, down
6.6 million pounds or 3 percent from February and 15.9 million
pounds or 7 percent below March 2009, according to preliminary
data in the Agriculture Department’s latest Cold
Storage report issued this afternoon.
The March American cheese inventory, at 600.8 million pounds, was unchanged from February but 52.2 million pounds or 10 percent above a year ago. February revised estimates were raised up nearly 1.1 million pounds.
Total cheese stocks amounted to 1 billion pounds, up 15.1 million pounds or 2 percent from February, and 85.6 million or 9 percent above those a year ago. February total cheese stocks were revised up 2.1 million pounds from previous month.
Foundation
For The Future Program
(April 22, 2010)
National Milk, represented by Pennsylvania dairy producer Lauren
Mosemann, testified Tuesday before a dairy specific 2012 Farm
Bill hearing in that state by the House Agriculture Committee.
She spoke of National Milk’s new “Foundation for the
Future” program, according to Chris Galen in Thursday’s
broadcast “Because the Federation is trying to align the
thinking of lawmakers behind the rational for coming up with our
new approach to setting up a safety net for dairy farmers and
helping to manage some of the price volatility that’s out
there that has been plaguing the industry for years, especially
the last 18 months.”
The hearing was mainly to garner input from Pennsylvania dairy farmers about what they would like to see in dairy policy ahead, Galen reported, and that was followed by a hearing Wednesday in Washington where Agriculture Secretary Tom Vilsack spoke about the upcoming Farm Bill.
Galen said it’s preparation for getting the Committee to deal with the new Farm Bill and, while it’s a couple years away, “they are trying to be aggressive in the House Ag Committee because they realize that, apart from all the other challenges we have in dairy or in some of the other commodities, one of the biggest challenges is going to be the budget and how you pay for any new programs.” “They want to move aggressively to try to come up with some new ideas because one of the huge issues confronting Congress is going to be the enormous national deficit and what types of government programs we will be able to afford,” he said.
The Federation has proposed replacing the dairy price support program with an income insurance program similar to the one Brian Gould talked about Wednesday from the University of Wisconsin. But, Gould questioned the chances of NMPF’s proposal which would require government funding.
Galen countered, saying that National Milk proposes that current government funding of the price support program and the MILC program be redirected to a margin insurance program that “has wider applicability and deals with the types of pricing situations that farmers are increasingly going to face in the future.” “We need to transition to a new and different safety net,” Galen concluded.
(April 21, 2010) Monday's March Milk Production report is bearish but may not necessarily impact cheese prices, according to Downes-O’Neill dairy broker, Dave Kurzawski. Speaking in Wednesday’s broadcast, Kurzawski said there’s been pressure on the cheese market in the past six or seven trading sessions and while, that pressure “may not go away today,” he believes demand will respond to a price that’s now “south of $1.40.”
Pointing to the January and February downward revisions of milk output, Kurzawski said “We’re starting from a little bit lower point of total production than we initially thought but that number is relatively bearish for the market right now.”
Weather is also improving and the spring flush is occurring around the country so there’s not much worry of a shortage of milk production right now he acknowledged, but “The caveat here is that Wisconsin, Washington, Michigan, and Idaho (states registering sizable increases) are not the only places that we need to be producing milk. The world needs milk to make their products so while we have a bearish report here I tend to think that the bubbling of demand from butter, nonfat powders, and the dry whey powder markets will ultimately supersede this milk production report.”
Oceania is struggling with low milk production, according to Kurzawski. New Zealand is in a two month draught and didn’t have a great flush a few months back and output is 2 1/2-3 percent below that of a year ago. Australia is down 5-6 percent, he said, “So we have to look at the supply of milk from a worldwide standpoint, not just what’s going on here domestically.”
Kurzawski suggests producers lock in a floor price, admitting that “today may not be the day to do that but they should be shopping around for the best possible/worst case scenario price.”
He remains relatively bullish for milk prices for the next 60-90 days and believes futures prices will “give these guys a good opportunity to lock in that floor price to potentially market milk outright and lock in a profitable level to bring to the dairy.”
Looking
ahead on our week; the Agriculture Department’s monthly
Livestock Dairy and Poultry Outlook is issued this morning. the
March Cold Storage report is out tomorrow afternoon, and Friday
morning USDA issues its monthly Livestock Slaughter report
and the May Federal order Class I base milk price is
announced.
As
always, we will post complete details here as soon as
possible and please vote on our new website poll.
(April 21, 2010) The Nation’s dairy herd continues to contract on a year-over-year basis, according to the Agriculture Department's latest Livestock, Dairy, and Poultry Outlook released this morning. However, milk per cow continues to rise incrementally. The April Milk Production report indicated that milk per cow was 51 pounds (lbs) higher in March compared with a year ago.
Moderating feed prices for 2009/10 and the prospect of continued moderate feed prices into the next crop year have provided an incentive to increase output. However, lower milk prices have kept the milk-feed profitability ratio below 2.5. A milk-feed price ratio above 2.5 is considered necessary to begin any expansion.
Although the U.S. dairy herd continues to decline, the rate of decline appears to be moderating. The March Livestock Slaughter report showed 223,000 dairy cows slaughtered under Federal inspection in February, the second lowest total since last May.
Meanwhile, producers added 3,000 cows in both January and February. For 2010, the U.S. dairy herd is expected to average 9,065,000 cows, a 1.5 percent decline from 2009, but somewhat higher than recent USDA estimates. Output per cow is projected at 20,950 lbs resulting in a forecast 189.9 billion lbs of milk in 2010.
Although
stock estimates were slightly higher than forecast last month,
ending stocks for 2010 on both a fats and skim-solid basis are
still expected be below 2009. Ending stocks on a fats basis are
projected to end 2010 at 10.4 billion lbs; stocks on
a skim basis are forecast to end the year at 10.8 billion lbs. Most of the drawdown in stocks is likely to occur in the second half of 2010.
Commercial
use is projected to reach 188.4 billion lbs in 2010 on a fats
basis, up 1.3 percent. Moderating prices for cheese and economic
recovery are the basis for stronger domestic commercial use on a
fats basis. The higher commercial domestic
use should drawdown currently high cheese stocks over the course of the year and firm cheese prices by year’s end. Commercial use on a skim-solid basis is expected to reach 167.6 billion lbs, up 0.5 percent from last year.
Higher exports of powder, especially later in 2010, are expected to draw powder from the domestic market, strengthening prices for nonfat dry milk in the second half of 2010. Commercial milk equivalent exports are forecast at 4.75 billion pounds and 25.4 billion pounds on a fats and skim-solid basis, respectively. Most of the expected increases are based on higher expected exports of butter, milk fat, and nonfat dry milk (NDM).
While exports have been modest in the first quarter, movement is likely to improve in later quarters due to economic recovery in importing countries and tighter supplies from potential competitors.
Higher
forecast milk production and relatively high cheese stocks
suggest a scaleback in prices. Cheese prices could strengthen in
the second half, if recovery continues and stocks are drawn
down. Cheese prices are expected to average $1.490
to
$1.540 per lb this year. Butter sales have been at least
reasonable, and production
will
likely tighten seasonally as cream supplies move to production
of ice cream.
Butter
prices are forecast to rise over the course of the year as
demand improves despite second-half increases in milk
production. Butter prices are expected to average $1.420 to
$1.500 per lb in 2010.
NDM prices should climb in the second half of 2010 as exports increase. NDM prices are forecast to average $1.110 to $1.150 a lb in 2010. Whey prices have already rebounded from last year and are expected to remain near present levels for the balance of 2010. Prices will likely average 37.5 to 40.5 cents a lb this year.
As
milk production increases encounter expected increases in
demand, prices are likely to be higher than 2009 but not rise to
2007 or 2008 levels. The Class IV price is forecast at $13.40 to
$14.00 per cwt in 2010. The Class III price is expected to
average $14.10 to $14.60 per cwt, and the all milk price is forecast to average $15.45 to $15.95 per cwt.
More
Milk Will Be Coming On Line
(April 20, 2010) The continued
descent of cheese prices is evidence of a fear that more milk
will be coming on line, according to the University of
Wisconsin’s Dr. Brian Gould in Tuesday’s DairyLine.
Producers are responding to the temporary gains in prices a
couple months ago, he said, and are increasing their production
and there’s concern that too much milk is entering the
pipeline.
He mentioned the significant gains and the significant losses in the CME cash cheese market and said volatility is ever present and was a front and center topic at last week’s first meeting of USDA’s Dairy Advisory Policy Committee.
He also mentioned the Livestock Gross Margin insurance program, which the University of Wisconsin has been working on for about two years along with National Milk’s proposed Dairy Producer Income Protection program.
The two have similarities, he said, but there are significant differences. Gould has put together a power point presentation comparing the two and listeners were invited to send him an e-mail requesting the presentation at bwgould@wisc.edu.
He predicted that there’ll be a lot of discussion about this, concluding that “it’s hard to say whether there’ll be any real change down the road but there are some innovative ideas being tossed about.”
.
March Milk Production Up 0.9 Percent|
State by State |
Milk Cows
|
Output Per Cow
|
Milk Production
|
|
Arizona |
-19,000 |
+70 lbs. |
-7.0% |
|
California |
-63,000 |
+55 lbs. |
-0.7% |
|
Colorado |
-12,000 |
+20 lbs. |
-8.3% |
|
Florida |
-4,000 |
-60 lbs. |
-6.8% |
|
Idaho |
+4,000 |
+40 lbs. |
+3.0% |
|
Illinois |
-1,000 |
+40 lbs. |
+1.2% |
|
Indiana |
+2,000 |
+15 lbs. |
+2.1 |
|
Iowa |
-5,000 |
+45 lbs. |
+0.3% |
|
Kansas |
-6,000 |
Unchanged |
-4.9% |
|
Michigan |
+1,000 |
+80 lbs. |
+4.5% |
|
Minnesota |
+2,000 |
+55 lbs. |
+3.8% |
|
Missouri |
-7,000 |
-25 lbs. |
-8.4% |
|
New Mexico |
-12,000 |
-5 lbs. |
-3.8% |
|
New York |
-13,000 |
+40 lbs. |
+0.2% |
|
Ohio |
-9,000 |
+70 lbs. |
+0.9% |
|
Oregon |
+1,000 |
+30 lbs. |
+2.6% |
|
Pennsylvania |
-10,000 |
+60 lbs. |
+1.6% |
|
Texas |
-20,000 |
+40 lbs. |
-2.6% |
|
Utah |
-2,000 |
+40 lbs. |
Unchanged |
|
Vermont |
-1,000 |
+40 lbs. |
+1.9% |
|
Virginia |
-2,000 |
-40 lbs. |
-4.5% |
|
Washington |
+10,000 |
+70 lbs. |
+7.9% |
|
Wisconsin |
+4,000 |
+100 lbs. |
+6.3% |
|
23 State Total |
-162,000 |
+51 lbs. |
+0.9% |
(April 19, 2010) U.S. cheese exports are coming back, thanks in part to exciting new foodservice programs in Japan, according to Margaret Speich of the U.S. Dairy Export Council in Monday’s “DMI Update.” She said that dairy producers should be encouraged to see this improvement in U.S. cheese exports in recent months, reporting that, from October to January, U.S. cheese exports were up 15 percent.
The biggest growth area has been Japan, according to Speich, and, in January, U.S. cheese exports to Japan were up 93 percent. “We’re seeing greater use of U.S. cheese in the foodservice sector,” Speich said, “Thanks to USDEC promotional activities with some of the major chains.”
For instance, about 18 months ago, USDEC’s Japan office conducted a foodservice cheese seminar that featured recipes for several different cheeseburgers using Monterey Jack from the United States. This event was attended by five menu-management officials from McDonald’s Japan.
Following the program, McDonald’s Japan developed two quarter-pound burgers, a New York burger and a California burger, using U.S. Monterey Jack. The company introduced the new burgers in February and March, accompanied by TV commercials featuring the theme, “Big America.” This is the first time McDonald’s Japan has used U.S. cheese, she said, and it expects to use close to 400,000 pounds of U.S. cheese during a six-week promotion.
Several other foodservice chains have started using U.S. cheese in the last year as well, including Lotteria, the third largest hamburger chain in Japan, Gusto, the largest family restaurant chain in the country, and Sizzler.
“This is good news for U.S.
dairy producers,” Speich concluded. “Activities like these
help build demand for U.S. dairy products around the globe.”
(April
16, 2010) The cheese price roller coaster is back in business as
the blocks tumbled 10 cents the second week of April, ending
Friday at $1.3975 per pound, still 22 3/4-cents above that week
a year ago. The barrels rolled 7 1/2-cents lower, to $1.3650,
but that’s 25 1/2-cents above a year ago. Only two cars of
block traded hands on the week and 13 of barrel. The lagging
NASS-surveyed U.S. average block price hit $1.3166, up 3.1
cents. Barrel averaged $1.3598, up 6 cents.
University
of Wisconsin Emeritus Professor, Dr. Robert Cropp, commenting in
Tuesday’s DairyLine,
recalled that it was just a few weeks ago the price was at $1.26
or $1.27 and “that seemed way too low,” then it approached
$1.50, and “now we’re going back down again.”
February
cheese stocks were relatively high, he explained, and the other
disturbing thing is that USDA revised its 2010 milk production
forecast again. It had once predicted a 0.7 percent decrease
from 2009 but is now expecting a 0.3 percent increase, plus
growing cow numbers is another concern, he said.
“The
concern is that milk production is not going to decline as we
thought,” Cropp said. That, with plentiful stocks and a weaker
than expected export market on nonfat dry milk, portends cheaper
powder and more milk going to cheese.
The
market has to strengthen in the second half, he warned, because
these cheese prices portend a Class III milk price below $14 and
that will continue to stress farmers, with no recovery for lost
equity. That could mean second half decreases in the milk supply
and a recovery in prices, he said. Cropp looks for cheese to
“bounce around $1.40-$1.45 until we move further into summer.
Butter
remains strong and closed Friday at $1.56 per pound, up 6 cents
on the week, and 35 3/4-cents above a year ago. Only four cars
were actually sold on the week. NASS butter averaged $1.4749, up
2.3 cents.
Cropp
said cream supplies are tighter as temperatures rise and more
cream goes into ice cream. Butter sales are “half way
reasonable,” he said, and earlier, there was some inventory
building by buyers who recognize that the cream supply and
butter production will get tighter as we move into summer.
Butter stocks are also slightly below a year ago, he said.
Cash Grade A nonfat dry milk closed Friday at $1.2925, up 2 3/4-cents on the week. Extra Grade closed at $1.21, up 2 cents. NASS powder averaged $1.1111, up 4.5 cents. Dry whey averaged 36.34 cents, up 1.9 cents.
Colorado Dairy Producer Endorses Beef Checkoff
(April
14, 2010) Jim Docheff is a Longmont, Colorado dairy producer who
believes in the beef checkoff. He said so in Wednesday’s DairyLine,
saying it’s “dollars well spent and something every dairy
producer needs to pay into and be happy to do it.”
“Ultimately,
all these milk cows become beef and enter the food chain,” he
reasoned, and while he admits that beef sales on a dairy farm
are a small part of its income, in financial times like now,
“we looking for every dollar out there and if we can raise the
price of those beef cows, $10-$15 a head for that dollar we’re
paying, I think that’s a pretty good return for our money.”
He
pointed out that a lot of culled dairy cattle go to ground beef
and he suggests a partnership with the dairy check off to
promote cheeseburgers, especially with summer grilling upon us,
he believes we could increase beef and cheese sales at the same
time. He has suggested this to the Beef Board to not just
promote beef, but include dairy and this would be “good for
everybody involved.”
He admits the calf issue is a tough one. They do have a value, he said, we just need to determine what that value is. It’s a sore subject for dairy farmers, he concluded, “I can’t say that we’ve seen a real bang for our buck on those but we need to get some brains together on that, sit down and see what we can come up with because there has to be something we can do with those dairy calves.”
National Milk dairy economist Roger Cryan has raised his May Milk Income Loss Contract Payment (MILC) projection. He will talk about it and look ahead on tomorrow's DairyLine broadcast and Select Sires has its weekly "Reproductive Moment" in our second half.
Market
Analysis With Dr. Robert Cropp
(April 13, 2010) The cheese price roller coaster seems
to be back in business as the blocks tumbled 2 3/4-cents in the
first day of trading of the new week. The barrels rolled 2 cents
lower. University of Wisconsin Emeritus Professor, Dr. Robert
Cropp, commenting in Tuesday’s DairyLine, recalled that
it was just a few weeks ago that price was at $1.26 or $1.27 and
“that seemed way too low,” then it approached $1.50, and
“now we’re going back down again.”
February cheese stocks were relatively high, he explained, and the other disturbing thing is USDA revising its 2010 milk production forecasts again. It had once forecast a 0.7 percent decrease from 2009 but it’s now expecting a 0.3 percent increase, and growing cow numbers is another concern, he said.
“The concern is that milk production is not going to decline as we thought,” Cropp said. That, with the plentiful stocks on hand and a weaker than expected export market on nonfat dry milk, portends cheaper powder and more milk going into cheese.
The market has to strengthen in the second half, he warned, because, these cheese prices portend a Class III milk price below $14 and that will continue the stress on dairy farmers, with no recovery for lost equity. That could mean second half decreases in the milk supply and a recovery in prices. He looks for cheese to “bounce around $1.40-$1.45 until we move further down into summer.
Butter remains strong and Cropp says it could move a penny or two higher. Cream supplies are tighter as temperatures rise and more cream goes into ice cream.
Butter sales are also “half way reasonable,” he said, and earlier, there was some inventory building by buyers who recognize that the cream supply and butter production will get tighter as we move into summer and butter stocks are slightly below a year ago.
California May Class 1 Prices Announced
DMI Update
(April
12, 2010) Dairy Management Incorporated’s senior vice
president of industry relations, David Pelzer, explained why
dairy farmer check off dollars were used to fund the dairy
crisis drill in Seattle March 31 in Monday’s “DMI Update.
“
“We’re
all in this together,” Pelzer said, “In making sure that we
maintain public confidence in the dairy industry and dairy
products, especially in an industry wide crisis where the safety
of dairy products would be called into question.”
“Dairy
farmers rely on the whole dairy market chain to supply products
to consumers, Pelzer explained, “And we want to make sure that
we get everybody (processors and cooperatives) on board in using
unified messaging.”
He
said it’s important that they’re aware of the various crisis
management tools that the dairy checkoff offers and to recognize
the importance of crisis preparedness and to communicate with a
common voice to the public during a crisis situation.
Two
of these drills were conducted last year, according to Pelzer,
and there’ll be one in Atlanta in July and Dallas in November.
A
number of companies have gone back and done their own drills
internally, Pelzer said, and DMI applauds that and he reported
that state and regional organizations also work with companies
if they desire council in increasing their crisis preparedness.
(April
9, 2010) The big question after Easter was; will the run up in
cheese prices hold? That appeared to be the case the first full
week of April as prices advanced for the fourth week in a row
but they reversed gears Friday, resisting the climb above $1.50.
The blocks closed Friday at $1.4975 per pound, down 1 1/4-cents
on the day, up 6 3/4-cents on the week, and 26 1/4-cents above a
year ago. Barrel closed at $1.44, down 1 1/2-cents on the day,
up 6 1/2-cents on the week, and 27 cents above a year ago. Three
cars of block traded hands on the week and nine of barrel. The
NASS-surveyed U.S. average block price lost 1 1/2-cents, hitting
$1.2866. Barrel averaged $1.3003, up 1.1 cents.
Butter
closed Friday at $1.50, up a half-cent on the week and 29
1/2-cents above a year ago. Three cars were sold. NASS butter
averaged $1.4524, up 0.1 cent.
Cash Grade A nonfat dry milk closed the week at $1.2650, up 4 cents, while Extra Grade closed at $1.19, up 2 1/2-cents. NASS powder averaged $1.0657, up 1.4 cents, and dry whey averaged 38.22 cents, up 1.3 cents.
WASDE: Milk Production Estimate Raised Again
(April
9, 2010) The Agriculture Department has raised its 2010 milk
production forecast again in this month’s World
Agricultural Supply and Demand Estimates report issued
this morning, based on a reduced herd reduction from last
month. Output is now projected to hit 189.9 billion pounds, up
400 million pounds from last month’s estimate, and compares
to 189.3 billion produced in 2009.
Dairy
exports on a skim-solids basis were lowered due to
weaker-than-expected sales early in the year. Both fat and
skim-solids basis imports were reduced from last month due to
weaker-than-expected imports of cheese, the report stated. Fat
and skim stocks were forecast higher for 2010 as cheese stocks
have not declined as expected.
Product
price forecasts were generally lowered from last month as milk
production was forecast higher and demand is weaker than
expected. The cheese price was reduced as stocks remain high,
according to the report, but the butter price forecast was
unchanged “as stronger prices in the first half of the year
may largely be offset by lower second-half prices as butter
production increases.” The nonfat dry milk price was
forecast lower as export demand lags and the whey price was
lowered slightly.
The
2010 Class III milk price forecast was lowered due to lower
cheese and whey prices and is expected to average
$14.10-$14.60 per hundredweight, down from the $14.20-$14.80
projected a month ago. The 2009 average was $11.36.
The Class IV price was also lowered to $13.40-$14.00, down from the $13.65-$14.35 range expected last month. The Class IV averaged $10.89 in 2009. The all milk price for 2010 is forecast at $15.45-$15.95.
(April
9, 2010) After peaking in January, a three-month decline in milk
prices has increased efforts to create a nationwide milk supply
management program. Dairy Profit Weekly editor Dave Natzke
reported Friday that low milk prices continue to stress dairy
farmers nationwide, resulting in several proposals to create a
supply management program.
Meetings
in Vermont and California in the past week each attracted about
200 farmers, industry and political leaders to discuss efforts
to control milk supply and stabilize milk prices, Natzke
reported. The California meeting featured Democratic Congressman
Jim Costa (D-Fresno), who is drafting a bill to establish a
mandatory supply management program.
Under a preliminary draft of Costa's bill, a producer board and
the U.S. secretary of agriculture would establish allowable
quarterly milk production levels for each dairy, as well as a
market access fee, based on historical production levels, a
milk-feed price index, and other milk marketing factors. Dairy
farmers who surpass their assigned milk production level would
have to pay the market access fee on that excess milk, with the
money shared with all producers who stay within their assigned
production levels for the quarter.
The
nation’s largest dairy cooperative, Dairy Farmers of America,
and the Midwest's largest dairy co-op, Associated Milk Producers
Inc., have embraced some form of supply management, according to
Natzke, but not any specific proposals. One of the largest dairy
co-ops in the Northeast, Agri-Mark, has drafted a proposal of
its own, called "marginal milk pricing,” he said, and
several other plans have been developed. A University of Cornell
study comparing various proposals is expected at the end of May.
Support of a mandatory supply management plan is not universal,
Natzke warned. Opposition is strongest in the Upper Midwest, he
said, which is seeing a dairy resurgence and a recent meeting of
farmers in Idaho’s Magic Valley found nearly two-thirds
opposed a government-mandated supply managed program.
He
said that many believe the program should be eliminated and the
resources that the government has devoted to it should be
shifted to a new income protection program that would provide a
better safety net for dairy farmers.
“The
price support program has worked well historically,” Galen
admitted, “But, I think in the past decade; it has become
clear that it’s time for a new approach.” He explained that
the program is not being administered effectively and companies
often chose not to sell product to the government, particularly
cheese, and the product that does get sold to USDA is nonfat dry
milk.
“Milk
that U.S. farmers produce,” Galen argued, “Rather than being
sold commercially either domestically or internationally, gets
sold to government warehouses where ultimately it does get
returned to the market in one way, shape, or form.” National
Milk doesn’t think that’s the best way to handle the
occasional surplus, he said.
The
price support program also acts as a disincentive to product
innovation, Galen charged. “We have processing plants that are
designed to produce nonfat dry milk simply to be sold, at least
sometimes, to the government rather than that milk be processed
into things that the market actually wants,” he said, “So
that’s not the most effective way to conduct business.”
The program also supports dairy farmers around the world, not just U.S. farmers, according to Galen, “because other countries, particularly farmers in Australia and New Zealand, benefit from the price protections of our price support program.” Kozak’s editorial is posted on our website at www.dairyline.com under the dairy news link for April 8.
(April
7, 2010) IDFA’s Peggy
Armstrong, said in Wednesday’s DairyLine
that the dairy crisis drill last Wednesday brought about
90 people to Seattle, and called it a “terrific day and a
great learning experience.” She added that a lot of strong
relationships were built there which is key to working
effectively in a crisis.
She
said the drill was important because the industry needs to
effectively respond in any food safety crisis and to have a
plan in place so all the players across the industry
understand the importance of a plan. Many organizations
already have plans in place, she said, so those people who
attended the drill were able to practice their skills.
“The
more you plan and think through what is unthinkable, the
better prepared you are,” Armstrong said.
Research shows that the organization that plans for
crisis, recovers two to three times faster than one that
doesn’t so our goal is to really be ready for anything.
She admitted that the drill forced people to work with people they never met before. That doesn’t happen in the real world but questions and changes come to you very very quickly during a real crisis so we want to make sure people understand that and are prepared.
Two
words remain in my thinking process from my short stint in the
Boy Scouts as a kid; “Be Prepared,” a bit of wisdom that
has served me well over the years. I thought of that and was
reminded of the old fashioned “fire drills” we used to
have in grade school as I participated in a “dairy crisis
drill” in Seattle the last day of March, hosted by Dairy
Management Incorporated and the International Dairy Foods
Association. I literally saw farmer and processor check off
dollars at work!
There
were about 90 participants from several states, made up of
dairy processors, state and regional check off staff, state Ag
department people, a Food and Drug Administration official,
and three real live FBI agents, one of which even handed me a
Haggen daz bar, another topic for another day.
Attendees
were divided into small groups and assigned to fictitious
dairy companies where various titles, job descriptions, and
roles were given. I was an “imbedded reporter.”
So
far so good until a news bulletin reports a large outbreak of
Staphylococcus Enterotoxin B (or SEB if you’re a TV or radio
announcer). Board members are summoned together to discuss the
news accounts that soon start pointing to dairy as a possible
suspect until the “you-know-what really hits the fan.”
Those familiar with the story of Job know that bad news often
comes in waves and such was the case in our “drill,” or
should I say “grilling.”
Just
as the board members are trying to decide how their company
will respond to calls from consumers and the media regarding
their company brand and any implication it may have in the
ongoing crisis which is escalating. board member blackberries
and e-mails are coming fast and furious and the public wants
to know if it’s safe to eat your dairy products. There’s
no passing the buck in a crisis when you’re up to your,
you-know-what in alligators.
Several
of these “officials” had to face me and media colleague
Kate Sander of Cheese
Market News in mock news conferences where Kate and I role
played as aggressive reporters trying to get the story for our
readers and listeners.
I
refrain from further details so as not to give too much away
for upcoming future drills like this around the country but
I’m confident the drill drove home the point that, while
this was a fake exercise, it was a realistic one and one that
could one day, God forbid, really happen. What would your
dairy cooperative do in such a case? Does it have a plan in
place, ready to go?
These
CEOs and board members will be the ones to defend your
cooperative and its dairy farmer members in such a situation
and I couldn’t help but think that I’d sure want a
competent, qualified, trained person to answer the press’
tough questions, instead of the janitor or a milk truck
driver.
The
training was tough, intensive, and probably cost a few bucks
to put on. But, in the spirit of “Boy Scout preparedness,”
is vital in the world we live in today. Thankfully, the dairy
industry has been pro active for some time in this area and
has a Dairy Communication Management Team in place made up of
Dairy Management Incorporated, the International Dairy Foods
Association, U.S. Dairy Export Council, National Milk, and
MILKPEP so the industry can, as was pointed out; speak with
one voice, respond only when dairy is called into question,
and follow the government’s lead in such events.
The Tylenol Company laid the right response ground work in the nightmare it went through years ago, a nightmare that the CEO and board members of Toyota have surely learned of late. Airlines have done these drills for years. Is your cooperative prepared?
Market
Talk with Alan Levitt
(April
6, 2010) The big question post Easter is will the run up in
cheese prices hold. Dairy producers saw a big cut last week in
their farm gate Class III milk price. Alan Levitt, editor of the
CME’s Daily Dairy
Report, pointed out in Tuesday’s DairyLine
that the Class III will be at the lowest level since September
so profitability will be down in March and at the lowest since
last fall, but the loss maybe offset some by lower feed prices.
He said there were actually three positives last week.
First,
a bearish USDA plantings report sent corn prices down as May
corn futures dropped to the lowest level since last September,
Levitt reported.
Secondly,
international markets are starting to improve. Overseas buyers
are getting nervous about supply and availability for the second
half of the year. They saw an unusually cold winter in Europe,
Levitt said, which put a dent in their spring flush, and a
draught in Oceania has left their production flat for the
current season, he said, which is winding down. Oceania
suppliers say they’re mostly sold out for the rest of the
marketing year, Levitt reported, and that strengthened the U.S.
nonfat dry milk market and added bullishness to the outlook.
Thirdly,
the cash cheese market shot up sharply last week. Sellers have
had almost nothing to offer, Levitt said, and the price has
strengthened mostly on unfilled bids so “Hopefully, it’s
sustainable though not that much has changed fundamentally.”
We still have pretty strong cheese production and pretty heavy
inventories, he said, “So we don’t know if the strength was
just pipeline filling.”
He
doesn’t see cheese taking off like it did a couple years ago.
Consumers are still in a value mindset, according to Levitt. He
reported that Wal-Mart, this month, announced that it was
reducing prices on 10,000 items so he doesn’t think people are
willing to pay what took place a couple years ago. He looks for
stronger prices but not the kind of run ups we have seen in the
past.
I Keep My Cows Comfortable
(April
5, 2010) Pennsylvania dairy producer Paula Meabon talked with DairyLine’s
Bill Baker about the reasons she is involved with the National
Dairy Board at this year’s World Ag Expo in Tulare.
California. That interview aired on Monday’s “DMI Update”
and Meabon pointed out that she was asked to serve about six
years ago and she readily agreed.
She
said she loves dairy farm living and knows that promotion is an
important part of that life and urges farmers to “tell their
story” instead of letting the neighbors do it.
“I
keep my cows comfortable,” Meabon said, “With fresh feed,
fresh water and I want consumers to know that; why would I treat
my cows badly. They’re my bread and butter.” She said it’s
why farmers need to tell their story and treat their animals
like they should be treated.
A
lot of assumptions are made and bad press can put dairy farming
in a bad light and sometimes you have seven seconds to defend
yourself. Meabon stresses that “We treat our cows like they
should be treated. They’re our family. My calves are my babies
and, if I treat them kindly, they know who I am when they grow
up and, if they get loose, all I have to do is call them and
they come. Sometimes you can’t even call your children to
come.”
“As a dairy farmer, we have to keep our cows healthy so that they can produce nature’s most perfect food and that’s what we do on our farm,” she concluded.
March Federal Order Benchmark Milk Price Drops $1.50
Class
III futures portend another small drop in April, which settled
Thursday at $12.72. May rebounds to $13.28, June $14.00, and
July at $14.49, with a peak of $15.08 in September before
beginning the traditional seasonal decline.
The NASS cheese price averaged $1.3632 per pound, down 14.8 cents from February. Butter averaged $1.4388, up 7.8 cents. Nonfat dry milk averaged $1.0454, down 3.6 cents, and dry whey averaged 37.61 cents, down 1.6 cents.
|
CLASS & COMPONENT PRICES: |
|
COMMODITY |
March 2010 | Feb 2010 | Jan 2010 |
|
Class II Milk Price |
$14.46 cwt. | $15.65 cwt. | $15.22 cwt. |
|
Class II Butterfat Price |
$1.5417 lb. | $1.4474 lb. | $1.4475 lb. |
|
Class III Milk Price |
$12.78 cwt. | $14.28 cwt. | $14.50 cwt. |
|
Class III Skim Price |
$7.68 cwt. | $9.57 cwt. | $9.80 cwt. |
|
Class IV Milk Price |
$12.92 cwt. | $12.90 cwt. | $13.85 cwt. |
|
Class IV Skim Milk Price |
$7.82 cwt. | $8.14 cwt. | $9.13 cwt. |
|
Butterfat Price |
$1.5347 lb. | $1.4404 lb. | $1.4405 lb. |
|
Nonfat Solids Price |
$0.8688 lb. | $0.9043 lb. | $1.0148 lb. |
|
Protein Price |
$2.1311 lb. | $2.7066 lb. | $2.7916 lb. |
|
Other Solids Price |
$0.1823 lb. | $0.1992 lb. | $0.1946 lb. |
|
Somatic Cell Adjustment Rate |
$0.00068 per 1,000 cells | $0.00076 per 1,000 cells | $0.00077 per 1,000 cells |
| PRODUCT PRICE AVERAGES | March 2010 | Feb 2010 | Jan 2010 |
| Butter | $1.4388 lb. | $1.3609 lb. | $1.3610 lb. |
| Nonfat Dry Milk | $1.0454 lb. | $1.0812 lb. | $1.1929 lb. |
| Cheese | $1.3632 lb. | $1.5110 lb. | $1.5374 lb |
| Dry Whey | $0.3761 lb. | $0.3925 lb. | $0.3880 lb. |
Good
News For Future Dairy Feed Prices
(April
2, 2010) Several USDA reports were released this week and
provided some good news for future dairy feed prices, according
to Dairy Profit Weekly
editor Dave Natzke. He reported in Friday’s DairyLine
that “While March closed with lower milk prices, dairy farmers
may find some solace in the fact feed prices may also be
lower.”
USDA’s
monthly Ag Prices
report issued March 30, estimated that March all milk prices
averaged $15.10 per hundredweight, down 80 cents from February.
That decline offset decreases in corn and soybean prices,
according to Natzke, meaning the income margin over feed costs
was lower.
Dairy
farmers received better news the next day regarding feed prices
from USDA’s 2010 Planting
Intentions report and updated monthly Grain
Stocks estimates.
The
Planting Intentions
report shows U.S. growers will plant nearly 89 million acres of
corn this spring, up about 3 percent from both 2008 and 2009. In
addition, this year's soybean acreage is estimated at about 78
million acres, up less than 1 percent from last year, but still
the highest total on record.
Looking
at grain remaining in storage from 2009, USDA estimated there
were about 7.7 billion bushels of corn and 1.3 billion bushels
of soybeans stored in all locations as of March 1. Those
estimates put the corn inventory up 11 percent from a year ago,
but the soybean inventory down about 2 percent.
Reaction
to all this information on the Chicago Mercantile Exchange
pushed both corn and soybean futures prices lower through the
end of 2012, Natzke reported, “providing good news for dairy
farmers who must buy feed.”
The Planting Intentions report indicated 2010 U.S. hay acreage will be up about 1 percent from last year. And, for dairy farmers looking to feed cottonseed, cotton acreage is expected to be up 15 percent from a year ago, he said, concluding with the caveat, “Of course, Mother Nature still has lots to say regarding the 2010 crop harvest, but for now, the news appears better for dairy farmers.”
February
Dairy Products Report
(April 1, 2010)
The Agriculture Department’s February Dairy
Products report puts butter production at 141.1 million pounds,
down 21 million pounds or 12.9 percent from January and 4.6 million pounds or
3.1 percent below February 2009.
Mozzarella cheese output totaled 260.7 million pounds, down 24.3 million pounds or 8.5 percent from January, but 13.3 million or 5.4 percent above a year ago.
Total
Italian type cheese, at 332.8 million pounds, was down 29.9 million pounds or
8.3 percent from January, but 12.9 million
or 4 percent above a year ago.
American type
cheese amounted to 318.9 million pounds, down 28.7 million pounds
or 8.2 percent from January, and down 1.9 million pounds or 0.6
percent from a year ago.
Total cheese output came to 777.2 million pounds, down 64.4 million pounds or
7.7 percent from January, but 7.4 million
pounds or 1 percent above a year ago.
Milk
Feed Price Ratio is 2.26
(April 1, 2010) The March Milk-Feed Price Ratio is 2.26, down
from February's revised estimate of 2.35, according to USDA’s
“Ag Prices” report issued this week, and compares to 1.56 in
March of 2009.
The All Milk Price was estimated at $15.10 per
hundredweight, down 80
cents from last
month's estimate, but $3.30 above a year ago.
Corn averaged $3.49 per bushel, down 6 cents from February, and 36 cents below a year ago. The soybean price, at $9.16 per bushel, was down 25 cents from February, but 4 cents above a year ago. Alfalfa baled hay was $111.00 per ton, unchanged from February, but $27.00 below a year ago.