Archive for the ‘Todays Dairy News’ Category

Minnesota Crowns 61st Princess Kay of the Milky Way

August 20, 2014 – Jeni Haler, a 19-year-old college student from Norwood Young America, Minn., representing Carver County, was crowned the 61st 61st Princess Kay Jeni Haler wavingPrincess Kay of the Milky Way in an evening ceremony at the Minnesota State Fairgrounds, August 20.

Haler will serve as the official goodwill ambassador for more than 3,600 Minnesota dairy farm families. Jeni is the daughter of Rick Haler and Connie Helget Haasken, and attends the University of Minnesota – Twin Cities, where she double majors in animal science and Spanish/Portuguese studies.

Twelve county dairy princesses from throughout Minnesota competed for the Princess Kay of the Milky Way title. Audrey Lane of Prior Lake, representing Scott County, and Sabrina Ley of Belgrade, representing Stearns County, were selected as runners-up. Gabriella Sorg of Hastings, representing Dakota County, was named Miss Congeniality. Scholarships were awarded to Annie Culbertson of Pine Island, representing Olmsted County; Sarah Post of Chandler, representing Murray County; and Lane.

Haler’s first official duty as Princess Kay will be to sit in a rotating cooler in the Dairy Building for nearly six hours to have her likeness sculpted in a 90-pound block of butter on the opening day of the Minnesota State Fair. Each finalist will also have her likeness carved in butter during the fair. This year marks butter sculptor Linda Christensen’s 43rd year carving the Princess Kay of the Milky Way winner and finalists at the Minnesota State Fair.

Throughout her year-long reign as Princess Kay of the Milky Way, Haler will make public appearances to help connect consumers to Minnesota’s dairy farm families. She will also promote the Fuel Up to Play 60 program, through which she encourages students to get 60 minutes of exercise each day and eat a healthy diet that includes three servings of dairy.

Princess Kay candidates are judged on their general knowledge of the dairy industry, communication skills and enthusiasm for dairy. The Midwest Dairy Association sponsors the Princess Kay program, which is funded by the dairy checkoff.

Midwest Dairy Association® is a non-profit organization funded by dairy farmers to build demand for dairy products through integrated marketing, nutrition education and research. Midwest Dairy is funded by checkoff dollars from dairy farmers in a 10-state region, including Minnesota, North Dakota, South Dakota, Nebraska, Iowa, Illinois, Missouri, Kansas, Arkansas and eastern Oklahoma. For more information, visit www.midwestdairy.com. Follow us on Twitter and find us on Facebook at Midwest Dairy.

Photo Credit: Midwest Dairy Association

Grab Opportunity, Prepare For Uncertainty

August 20, 2014 – Today on DairyLine we head to the corner of Strategy & Discipline and visit with Scott Stewart, CEO of Stewart-Peterson, Inc. He tells us the good news for dairyStrategyDiscipline producers, and it’s not all about the milk price. Cattle and Feed prices are also looking good for producers. Stewart explains how to take advantage of good prices now, which can help create a financial cushion when milk prices drop and feed prices rise.

July Milk Production Jumps 4%

August 19, 2014 — The Agriculture Department’s preliminary data issued this afternoon in its latest Milk Production report, shows July milk output in the top 23 producing states at 16.39 billion pounds, up 4 percent from July 2013. The 50-state total, at 17.45 billion pounds, was up 3.9 percent from a year ago. Sequestered 2013 data was reinstated in the July report.    Revisions added 50 million pounds to the original June 23-state estimate, now reported at 16.2 billion pounds, up 2.3 percent from a year ago.    July cow numbers in the 23 states, at 8.58 million head, were up 6,000 from June and 56,000 more head than a year ago. The 50-State count, at 9.27 million head, is up 5,000 from June and 37,000 more than a year ago.    July output per cow in the 23 states averaged 1,911 pounds, up 18 pounds from June, 61 pounds above July 2013, and the highest production per cow for the month of July since the 23 State series began in 2003.

Selected state data is posted below:

State          Cow #s             Milk lbs./Cow        State Change vs.’13

Arizona       193,000                       1,960                      +8.9%

California    1.778 mil                      1,980                     +4.4%

Colorado    145,000                        2,135                     +7.6%

Florida        123,000                        1,710                     +5.0%

Idaho          580,000                        2,105                     +4.0%

Illinois           95,000                        1,660                     +5.3%

Indiana       179,000                        1,875                     +6.3%

Iowa           207,000                        1,890                     +1.6%

Kansas       142,000                        1,845                     +5.6%

Mich.          391,000                        2,120                      +8.2%

Minn.          460,000                      1,660                      -0.1% N

Mex.        323,000                       2,130                       -0.1%

New York    615,000                     1,935                      +4.8%

Ohio            266,000                     1,735                      +3.4%

Oregon       123,000                      1,750                      -0.9%

Penn.          530,000                     1,690                      +3.0%

S Dakota       97,000                     1,845                      +2.9%

Texas          470,000                     1,840                      +5.5%

Utah              95,000                     1,940                      +4.5%

Vermont      132,000                     1,730                      +4.1%

Virginia          92,000                    1,585                      +3.5%

Wash.          272,000                    2,070                      +2.9% W

Wisconsin    1.270 mil                     1,885                      +3.4%

 

CME Butter Continues to Rise

August 19, 2014 — International butter prices have topped out and are starting to work their way lower, but when is that going to take place here in the U.S.? CME spot butter slipped

Bill Brooks, FC Stone

Bill Brooks, FC Stone

a bit Monday but gained 2 1/2-cents Tuesday to rise to $2.66 per pound

“It’s just a matter of time, unless we see some weather related impact out of New Zealand and Australia,” said FC Stone’s Bill Brooks.  We have a pretty healthy spread between U.S. butter prices compared to international prices.

“It does cause some concern about how low prices will end up either later this year or the end of next spring, as folks bring butterfat into the country to take advantage of difference in prices between our level here and what’s going on internationally,” he said.

Here in the U.S. we are anticipating a growing dairy herd, with more milk per cow expected. Historically, the higher prices climb, the farther we fall, according to Brooks. At the moment, these butter prices have been a boon to producers, pushing the Class I and II prices higher.

Cheese prices are also helping the Class III price. We have seen an inverted spread between the blocks and barrels for nearly two months.

“The block market is more than adequately supplied with fairly heavy trading throughout that period,” Brooks said. “As a result the price has been struggling against the barrel price.”

We have a bit of displacement in the marketplace between the types of Cheddar that is in demand, which has been challenging for the industry to get their arms wrapped around because of the quick shifts we have seen.

“With cheese, we haven’t been that out of line with the international market,” he said. “It’s still essentially a domestically driven market.”

Brooks anticipates less pressure on declining cheese prices compared to what we might expect with butter.

Chicago Prices Defy World Market Levels

August 15, 2014 — We’ll Have a $2 Cheese Market at Least Through the End of August. Incredible cash prices are being seen in Chicago and continue to defy world market levels, with block cheese up 6 cents Thursday to the highest level since April 28, and barrels up 3 1/2-cents. Butter came back to life this week with a vengeance, skyrocketing 16 cents Thursday, to $2.66 per pound, a new high for 2014 beating late July’s $2.62, and may pound on the door of the all time record of $2.81 in September 1998.

FC Stone dairy broker Dave Kurzawski said in Friday’s DairyLine that domestic demand for cheese and butter is still very strong and may continue for some time. “I don’t know FCstonewhere the top of these markets will be,” he admitted, “I don’t know if anybody can answer that question, but what has happened here is that there remains a strong demand for fat and demand for butter.” Cream demand remains strong as well, he said, although cream demand has ticked down a little but “nothing too worrisome from the standpoint of the market bulls.”

Cheese has “chopped sideways, around the $2 level for several months now,” Kurzawski explained, “And now we’re starting to break back to the upside and all the bearish news globally has yet to translate into anything here domestically and so from that standpoint, if there’s still tightness the market might have to go up into a price where they’ll bring some excess inventory to the exchange.” Things are stronger than most people expect, he said, and “No one knows how long it will last but I think we will have a $2 cheese market at least through the end of August.”

The “bearish” news would appear to be the threat of rising milk production and Kurzawski says globally there’s no doubt about that and things will be changing in that regard next year in Europe and there’s concern about good weather in Australia and New Zealand as the El Niño scare “loses its steam,” but “Domestically here we have yet to see any of these real high prices that producers are receiving really translate into much of a big milk production situation in 2014 and we’ll probably see about a 1 1/2 percent increase and that’s just not enough at this point in time,” he concluded.

Milk Prices See Double Peak

August 14, 2015 — There has been a double peak in farm level milk prices. The U.S. dairy industry reached a record high earlier in the spring before dipping back down, but then prices went back up in July. That’s going to give us stronger prices in August.

This is despite some of the continued overall weakness in world markets. The European Union is currently shut out of Russia as they put sanctions on Europe’s export of dairy products.

“That means there’s more cheese trying to find a home in other markets because it can’t be sold now in Russia,” National Milk’s Chris Galen reported.

That being said, the U.S. exported 16.5% of its total milk solids during the first half of 2014, that’s an increase of 2% from last year. All the major categories including cheese and butter were well over last year’s level.

“This is one of the reasons why we’re seeing that double peak in prices,” Galen said. “Even though world prices are sagging now, the combination of our strong exports and internal demand and slower milk production means we will see above average prices for the remainder of the year.”nmpf

One of the big questions is why haven’t prices dropped more and is that related to slower milk production.

“You would think that with these record high prices that more cows and more milk per cow would have been more evident in the latest milk production report, but it’s been fairly slow going,” he said.

June Milking cow numbers were only raised slightly from a year ago.  For the most part milk production is growing but it hasn’t been coming on in torrents yet.  Because of that, we are not exceeding demand.

The National Milk Producers Federation (NMPF) will release their August issue of the Dairy Market Report Monday (Aug. 18th). The report will be available at nmpf.org

California Ramps Up New Pricing Proposal

August 12, 2014 — California Department of Food and Agriculture (CDFA) Secretary Karen Ross has proposed a significant change to the way milk is being priced in the state of WUDCalifornia.

“We’re having discussions with the dairy industry in the hopes that something (draft legislation) can occur this year,” CDFA’s Steve Lyle told DairyBusiness.

The proposal would index California Class 4a and 4b regulated minimum prices to announced Federal Order Class III and IV prices. It would also allow for manufacturing milk processors to enter into individual agreements to purchase milk outside of the pool.

“Actually we had a pretty good discussion,” Western United Dairymen CEO Michael Marsh said of a recent meeting. “Although producers and processors are not on the same page…which probably doesn’t surprise you.”

Marsh says he’s happy that Secretary Ross recognizes there is a significant problem with California’s 4b price.  He said there’s a transition period where indexing would be at a certain level below the federal prices. Early estimates indicate that it would be a substantial amount of additional money for dairymen coming out of the 4b price, but they would also give up a little bit on the indexing of the Class IV price.

Regarding the de-pooling of milk, WUD asked the Secretary to include an independent economic analysis on the impact it has on producers and processors as well as on plant capacity.  Also within 36 months, producers by referendum would be allowed to vote as to whether or not they wanted to continue de-pooling in a California milk marketing order.

“We’re really trying to get some additional protections into the secretary’s proposal on behalf of California dairymen,” Marsh said.

A joint meeting of the Dairy Task Force and the Dairy Advisory Committee is scheduled for Wednesday (August 13th), where they hope to review the Secretary’s final draft.

“This is the Secretary’s own attempt to come up with draft legislation, and we’re looking at what her thoughts are,” Marsh said. ““We’ll know also whether she has chosen to include some of the additional protections to dairymen that WUD proposed.”

The Secretary must move quickly as the California legislature concludes their session August 31st.  That would mean the legislation would have to move through policy committees of both the Assembly and the Senate, followed by the same legislation off both floors and then to the governor’s desk.

 

Biogas Opportunities Roadmap Will Foster Revenue Streams for Dairy Farms

August 11, 2014 — The White House recently released a Biogas Opportunities Roadmap highlighting the economic and environmental benefits and potential for biogas systems on dairy farms in the U.S. According to the Roadmap, biogas systems offer a wide range of potential revenue streams, growing jobs and boosting economic development for communities. The systems work by recycling organic material — including cow manure and food waste — into valuable co-products such as renewable energy, fertilizer, separated nutrients and cow bedding.

“This does several things for dairy farmers,” Tom Gallagher, chief executive officer of the Innovation Center for U.S. Dairy told DairyBusiness Weekly. “The most important thing it does is put us on a level playing field with wind and solar when it comes to accessing resources both from the government and private equity firms.”

To develop the Roadmap, The White House worked with the U.S. Department of Agriculture (USDA), Department of Energy (DOE) and Environmental Protection Agency (EPA), and worked with the dairy industry through the Innovation Center for U.S. Dairy, which was established under the leadership of dairy farmers.

“Farmers are the original stewards of the land, this will help them go faster in the environmental arena,” Gallagher said.

Biogas initiatives completed by the Innovation Center helped inform the Roadmap, including 2013 research that identifies a $2.9 billion market potential for anaerobic digester systems that co-digest dairy cow manure and food waste.

“The Biogas Opportunities Roadmap will help stimulate the emerging biogas market in ways that could provide revenue-generating opportunities for dairy farms of all sizes,” said Jim Mulhern, president and chief executive officer of the National Milk Producers Federation, which develops and carries out policies that advance the well-being of dairy farmers and the cooperatives they own.

The Roadmap strategies are entirely voluntary, not regulatory. “This validates the proactive and voluntary path the industry is already taking to reduce methane emissions, and provides direction for future actions and opportunities,” said Mulhern. NMPF sits on the Board of Directors for the Innovation Center.

The USDA, DOE and EPA will take these steps to promote the development of biogas systems:

  • Fostering investment in biogas      systems: To help overcome barriers to      the widespread investment in biogas systems, USDA will lead efforts to      better understand and track the performance of anaerobic digesters, seek      opportunities to broaden financing options, and review Federal procurement      guidelines.
  • Strengthening markets for      biogas systems and system products:      The Roadmap identifies activities that could strengthen the market for      biogas systems and system products including energy and other value-added      products. For example, dairy farms of all sizes could enhance their      revenues through nitrogen and phosphorus recovery.
  • Improving communication and      coordination: USDA will establish a Biogas      Opportunities Roadmap Working Group including the dairy industry to      implement the strategies in the Roadmap, with a goal to identify and      prioritize policies and technology opportunities by August 2015.
  • Promoting biogas use through      existing agency programs:      Leveraging existing programs will provide a way to enhance the use of      biogas systems in the U.S. by ensuring existing criteria for technical and      financial assistance considers the benefits of biogas system, leveraging      research funding, and strengthening programs that support the use of      biogas for clean energy, transportation fuel, and other biobased products.

“On dairy farms, digesters can increasingly be part of the solution to manure management challenges and enhance our ability to sustain our farms for the next generation,” said Jim Werkhoven, a dairy farmer in Washington and Chairman, Darigold, Inc.

Biogas systems could help the dairy industry, which contributes approximately 2 percent of total U.S. greenhouse gas emissions, to further reduce its carbon footprint. In 2009, the dairy industry established a voluntary goal to reduce its carbon footprint by 25 percent by 2020. The Dairy Power project is one of a portfolio of projects to help achieve that goal; it focuses on harnessing the value of manure and realizing the potential of biogas systems for U.S. dairy farmers.

“Dairy farmers are taking many steps to provide nourishing dairy foods and beverages that are responsibly produced,” Gallagher said. “Biogas systems are one example of many technologies available to the industry today that help us continuously improve our stewardship and contribute to our communities.”

Visit USDairy.com/DairyPower for information and case studies about biogas projects on dairy farms, and watch this video to see how a coalition of urban and rural partners — including the Cleveland Browns — used a biogas system to recycle cow manure and food waste.

 

Dairy Products Report Revision is NOT Bearish

August 8, 2014 — The additional cheese in USDA’s revised June Dairy Products report this week did impact dairy product commercial disappearance data generated by Jerry Dryer, Editor of the Dairy and Food Market Analyst, but it not necessarily a negative factor. He talked about it on Friday’s DairyLine.

A little over 37 million pounds of cheese had to be factored in, in a rare correction, which resulted in USDA republishing its report on Monday. The data was inaccurately reported to

Jerry Dryer Dairy Market Analyst

Jerry Dryer
Dairy Market Analyst

USDA, Dryer pointed out, and he praised the Agriculture Department for its prompt revision.

Given the original report, Dryer reported that commercial disappearance of American type cheese was virtually unchanged from a year ago. The revision resulted in commercial disappearance being up 2.2 percent during the most recent three months, in other words, Second Quarter of this year, and “a nice bump,” he said.

Other cheese disappearance was up 3.1 percent in the Second Quarter, “another strong number,” according to Dryer, butter disappearance was up almost 15 percent and skim milk powder/nonfat dry milk was up 5.3 percent, “so good solid commercial disappearance across the board during the Second Quarter of this year.”

Dryer does not see the added cheese as a bearish signal. “The cheese was produced and it was consumed,” Dryer argued. “The inventory numbers at the end of June didn’t change. They didn’t go up because cheese production went up, they actually in general went down, signaling to us stronger consumption.”

I asked him about this week’s continued drop in the Global Dairy Trade weighted average and the uncompetitiveness of U.S. dairy product prices on the world market.    “Uncompetitive?” Dryer responded. “Cheese exports in June were up 30 percent versus a year ago, I think we’re still competitive in the cheese market for sure and nonfat dry milk shipments were up 25% versus a year ago.” “U.S. prices are higher than anyone else’s,” he concluded, “But we also have the product to deliver and they don’t necessarily have it to deliver from other locations.”

FDA Has a Lot to Digest

August 7, 2014 –The National Milk Producers Federation wants the Food and Drug Administration to fix a problem in the planned definition of added sugars on food labels, saying it appears to include dairy products used as food ingredients, even though the lactose – or “milk sugar” – in those products occurs naturally.

Commenting August 1st on the FDA’s proposed changes to the nutrition facts label, NMPF was basically supportive of FDA’s proposal to list added sugars, saying it will clarify the contribution of lactose to dairy products and allow consumers to pinpoint added sweeteners in foods.

But, under FDA’s proposed definition, NMPF said the lactose in a tablespoon of nonfat dry milk incorporated into another food would count as an “added sugar,” while the lactose in a glass of milk would not.

“Surely, that can’t be what FDA intends,” said Beth Briczinski, NMPF’s vice present for dairy foods and nutrition. “We assume this is simply an oversight, since nonfat dry milk is often an ingredient in dairy products like yogurt and ice cream, as well as other foods, including baked and processed foods that benefit from added milk solids.”

“Either way,” Briczinski added, “this needs to be corrected.”

NMPF offered three specific reasons to exclude lactose-containing dairy ingredients from the definition of added sugars:

  • Unlike typical added sugars, dairy ingredients containing lactose are not used primarily to sweeten foods. In fact, compared with other sugars, lactose is not very sweet (it would take six times the amount of lactose to equal the sweetness level of table sugar). Instead, dairy ingredients like milk powder or whey powder are added to foods for other reasons, like texture and appearance.
  • The federal definitions of many standard dairy products allow them to include lactose-containing dairy ingredients, like nonfat milk powder, while still allowing the product to be called “unsweetened.” Examples include unsweetened yogurt and no-sugar-added ice cream.
  • Under FDA’s proposed definition, confusion would likely be created, since otherwise-identical dairy products would list or not list added sugars, depending on what ingredient was used. For example, a yogurt made with nonfat dry milk would be required to list added sugars, while the same yogurt made solely from skim milk would not list any added sugar.

NMPF also used its comments on the proposed revisions to the nutrition facts label to remind the FDA that it is allowing manufacturers of imitation dairy products, including soy “milk” and rice “yogurt,” to trick consumers into thinking their products are nutritionally equivalent to real-milk products.

“The name on a food conveys significant nutritional information,” said Briczinski. “Consumers think non-dairy alternatives with the term ‘milk’ or ‘yogurt’ in their name are nutritionally the same as real dairy products. But they are not. In addition, allowing these imitations to call themselves “milk” or “yogurt” is a clear violation of FDA’s own food standards and labeling regulations.

“It’s unfortunate that FDA has ignored this blatant misbranding of food products for decades, and is now touting its efforts to provide meaningful nutrition information to consumers,” Briczinski said.

Other points made in NMPF’s comments on FDA’s proposed revisions to the Nutrition Facts label:

  • Since industry in recent years has drastically reduced the trans fat in food – with a corresponding reduction in the trans fat in the American diet – it may no longer be necessary to list trans fat in the nutrition facts label. Regardless, ruminant trans fatty acids, which occur naturally in meat and dairy products, are not the same as added trans fats and should be exempt from the labeling requirement.
  • Dual-column labeling, designed to allow consumers to see nutritional information per-package as well as per-serving, doesn’t work for some dairy products, which should be exempted from the requirement – including quarts of milk, pints of cottage cheese, and dairy foods that are used primarily as ingredients, like butter and buttermilk.

In separate comments on serving-size issues, NMPF supported reducing a typical serving of yogurt from eight ounces to six ounces and opposed increasing a serving of frozen desserts from half a cup to a full cup. “The yogurt change makes sense,” Briczinski said, “since it brings the government’s measurement in line with packaging found in the marketplace.”

At the same time, Briczinski said, while FDA is proposing to increase a frozen dessert serving, consumption of both ice cream and frozen desserts generally has been declining steadily for two decades. “Consumption data,” she said, “strongly suggests that an increase in the frozen dessert serving size is not warranted.”

“Overall,” said Briczinski, “FDA’s proposed Nutrition Facts and serving size changes will have a positive impact. They will provide accurate nutrition information to consumers. But a few aspects of the proposals will result in unintended consequences for some dairy foods and FDA needs to review those aspects and correct them.”

The National Milk Producers Federation (NMPF), based in Arlington, VA, develops and carries out policies that advance the well being of dairy producers and the cooperatives they own. The members of NMPF’s cooperatives produce the majority of the U.S. milk supply, making NMPF the voice of more than 32,000 dairy producers on Capitol Hill and with government agencies. For more on NMPF’s activities, visit our website at www.nmpf.org.

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