Labor attorney Anthony Raimondo teams up with a dairy producer and a Homeland Security representative to address employer obligations to comply with current immigration laws and practical guidance on the legal hiring and retention of employees.
Dr. Frank Mitloehner, UC Davis researcher discusses air quality issue on dairies.
World Ag Expo (WAE) takes place this week in Tulare, California. DairyLine’s Bill Baker is there and is the Emcee for the Western DairyBusiness Dairy Profit seminars. WAE manager Jerry Sinift reported in Wednesday’s DairyLine that some major changes have been made to the dairy center building at Expo, including a cement floor and the fabric siding was replaced with metal. Wednesday was “FFA Day,” according to Sinift and about 2,000 students from schools in five western states were expected to be there at the show as part of a statewide assembly of the FFA with Michael Peterson the keynote speaker.
The show is huge and features equipment and services for any crop grown on the face of the earth. Sinift stated that over 300 different commodities are grown just in Tulare County alone so “you’ll see everything out on the show grounds.”
Also new this year is the beef and livestock pavilion. Surveys indicated that the beef industry is an important part of the lives of many attendees at Expo. Live cattle demonstrations are part of Expo this year, he said, related manufacturers are demonstrating their wares, there’s new developments for pregnancy testing in cattle are featured so this is an exciting thing for the beef industry and he likened Expo to the “Disneyland of agriculture.”
It is World Ag Expo and some 70 different countries are represented at Expo, either by attendees or exhibitors and he said it was fun watching the translating going on between the different languages being spoken. For more information, log on to www.worldagexpo.com.
Cash cheese prices continue to climb, perhaps in celebration of the cheese head victory of the Green Bay Packers in Sunday’s Super Bowl. Downes-O’Neill dairy economist Bill Brooks reminded Tuesday’s DairyLine listeners of an old adage that, “If the Packers made the playoffs it helped cheese sales,” but “those wearing the green and gold in Wisconsin or anywhere else in the country; “they’ll take credit for it and smile all the way to buying their Super Bowl merchandise.”
Brooks agrees with concerns that the market may be overheating but a better explanation of what’s happening, he said, may be that cheese prices are in a catch up mode to the butter and nonfat dry milk complex and may have more to do with the disparity in milk prices between Class III and Class IV, which, at times had been above $4 per hundredweight in favor of the Class IV. That’s likely impacting supplies of milk, Brooks explained, as well as the storms which spurred fluid sales and pulled milk that normally would have gone into the cheese vat.
That’s keeping a tighter supply in 4-30 day old product that trades at the CME even though we have historically high cheese inventories in commercial stocks. Normally, that would keep a lid on prices, he said, but “it’s not the right age of product to bring to the exchange and put a lid on these cheese prices.” Butter traders on the other hand appear to have shut off the lights and gone home. The price remains at $2.10, where it’s been since January 7. Downes said “they may be in winter hibernation and the ground hog hasn’t popped his head up to see what’s going on.” Brooks knows of no one who is comfortable at $2.10. Manufacturers are concerned about their inventory if the price falls and buyers are concerned that the price might move higher, though prices are at record levels for January, “so it’s a tenuous situation and nobody’s comfortable and they’ll get even less comfortable if the price does start to move against their interests.”
Dairy Management Incorporated’s Joe Bavido continued his series in Mondays DMI Update, looking back on the major accomplishments of the dairy checkoff in 2010. He began with the effort to deal with lactose intolerance among consumers and reported that the dairy check off partnered with H.P Hood and its Lactaid brand to grow lactose free dairy product sales.
There are millions of consumers who restrict or avoid dairy products due to real or perceived lactose intolerance, Bavido said, and if they can be brought back to consuming dairy products, it could mean an additional 2 billion pounds of milk sales annually. To that end; the checkoff has developed a website at www.moovision.com to build awareness and provide dairy first solutions to those suffering from lactose intolerance.
Last June dairy producers funded the Dairy Research Institute which Bavido said was founded to strengthen the U.S. dairy industrys access to industry investment, industry money, and technical research to drive innovation and grow sales. Through this institute, the dairy industry is hoping to combine resources and avoid duplication by working together with the industry total to conduct pre-competitive dairy product nutrition and technical research, he concluded.
Dr. Mike Hutjens, Extension Dairy Specialist at the University of Illinois, continues his discussion on alternatives to feeding corn.
The nation’s benchmark milk price has slipped some more. The Agriculture Department announced the January Federal order Class III price this morning at $13.48 per hundredweight (cwt.), down 35 cents from December, $1.02 below January 2010, and 99 cents above California’s comparable 4b cheese milk price. It equates to about $1.16 per gallon. Thursday’s Class III futures portend a February Class III price of $16.63, March $18.37, and April $18.08.
The Class IV price is $16.42, up $1.39 from December and $2.57 above a year ago.
The four-week, NASS-surveyed cheese price averaged $1.4076 per pound, down 5.3 cents from December. Butter averaged $1.8428, up 18.9 cents. Nonfat dry milk averaged $1.2530, up 6.8 cents, and dry whey averaged 39.35 cents, up 1.5 cents.
We’ve been reporting on the impact of milk and feed prices on dairy farm income but Friday’s DairyLine explored the impact on the prices of dairy cows with Dairy Profit Weekly editor Dave Natzke.
Natzke reported that USDA estimates that the average price paid for a dairy cow was $1,300 in January, down about $30 per head from October 2010, and $40 less than a year ago. Even more dramatic, he said, is that the average price paid in January 2011 is $600-$700 below peak prices paid in 2007 and 2008.The decline is due to a couple of factors, according to Natzke. As noted, the high cost of feed relative to milk prices is driving down dairy profitability, and may be limiting demand and the amount of money available to pay for replacement cows.
Second, USDA estimates there are nearly 50 dairy heifers for every 100 milk cows currently in the U.S. herd, making replacement animals plentiful. USDA estimates more than 3 million of those heifers will start producing milk this year, up 85,000 head from a year ago.
On the flip side, Natzke said beef prices for culled dairy cows are extremely high, averaging $63 per 100 pounds in January. Multiply that by a 1,400 pound cull dairy cow, and she’s worth nearly $900 as beef, or just $400 less than the replacement cow price, probably one of the smallest gaps in quite some time.
“With high beef prices and high numbers of heifers, we may see more dairy farmers selling older cows for beef, replacing them with heifers,” Natzke said. Super Bowl 2011 is Sunday and we’ll soon learn whether the “cheese heads” or the “steel heads” will be victorious but irregardless, consumers and dairy farmers will be victorious because Super Bowl is one of the biggest days for cheese consumption in the U.S. Natzke reported that many major pizza chains predicted some “super” results. Pizza Hut, the nation’s largest pizza chain, expects to sell a record 2 million pizzas that day, according to Natzke.
Dominos, with its partnership with the nation’s dairy farmers to increase cheese sales, expects to sell about 1.2 million pizzas nationwide, and Papa John’s, which is making a major marketing push during the Super Bowl, expects to sell 1 million pizzas.Check here for this morning’s announcement of January Federal order milk prices. Market analyst Alan Levitt predicts the Class III price will come in at $13.50 per cwt. That would be a drop of 33 cents from December and would be $1.00 below January 2010. He looks for a Class IV price of $16.50, up $1.47 from December and $2.65 above a year ago.
The Agriculture Department and the Department of Health and Human Services held a media conference to discuss the new 2010 Dietary Guidelines for Americans on Monday. National Milk’s vice president of Scientific and Regulatory Affairs, Jamie Jonker, told DairyLine listeners Thursday that the guidelines have positive things for the dairy industry and challenging things.
First, the “3 A-Day of Dairy” message is still important for the average American consumer, according to Jonker, and the Dietary Guidelines recommend average Americans continue to consume three servings of dairy daily, including low fat and nonfat milk, yogurt, and modest amounts of cheese.
In fact, Jonker said the Guidelines point out that that recommendation is currently not being met so, not only is the recommendation still included in the Guidelines, the recommendation is not being met meaning the dairy industry has an opportunity to increase consumption among Americans.
When asked if that principle carries into school feeding programs, Jonker said it certainly does because school lunch programs are based on the Dietary Guidelines, however the challenge here is the Guideline’s focus on what Jonker called the “nutrients to avoid,” things like sodium, solid fat, and added sugars.
“Those are challenges for the dairy industry,” Jonker said, “in such things as cheese on pizzas, flavored milks, and cheese snacks.”
The regular reassessment of the Dietary Guidelines behooves the dairy industry to remain vigilant in this process. Jonker also pointed out that the dairy industry needs to produce the products that Americans wish to consume.
The vegetarian and anti animal agriculture lobby is also involved in those process as Jonker pointed out there is an undertone of moving toward a vegan diet but the Dietary Guidelines recognize the important nutrients that dairy products contribute to the diet such as calcium, prosperous, protein, vitamins A and D, B-12, riboflavin, and niacin. Milk and dairy products are a complete nutritional package for consumers and I think that’s why the Dietary Guidelines continue to recognize them as being an important part of the American diet.”
The International Dairy Foods Association’s (IDFA) annual Dairy Forum held last week in Miami confirmed that there is far more consensus in the dairy industry than there has been in a long time, according to IDFA’s Jerry Slominski. Speaking in Wednesday’s DairyLine, Slominski said that dairy processors and producers agree that existing dairy policy needs to change and he reported that IDFA CEO, Connie Tipton said the dairy industry is “at a crossroads and IDFA believes that the path forward is with policies that promote growth to the benefit of all of us.”
A new study from Informa Economics was introduced at the Forum that shows the Dairy Market Stabilization Program, a key proposal of National Milk’s Foundation for the Future, would have withheld an estimated $626 million from dairy farmers if it had been in place from 2000-2009. The report also highlighted the program’s regional differences, according to Slominski, citing Wisconsin farmers as an example, stating that they would have paid $150 million while California’s dairies would have only paid $28 million.
“Taking money from dairy farmers during hard times, instead of helping, would be a remarkable turn-around for our nation’s dairy policy,” Slominski said. “In 2009, the worst year on record for dairy farmers, the stabilization plan would have withheld $390 million from producers. That very year Congress appropriated an extra $350 million, mostly in direct payments, to increase producer’s incomes.”
One of the most convincing arguments at the Forum against growth management, according to Slominski, came from Nestle’s Patricia Stroup, who told attendees that in order for companies like hers to continue their preferred course of sourcing high quality milk from the United States, they need to be assured that that supply will continue to be available and reliable. “There are many policy areas where we agree,” Slominski argued, “but the stabilization program, or any other government program to manage growth is the wrong path forward.” “Instead of being secondary, margin insurance, and other proposals where processors and producers agree, should be the essential part of that plan,” he concluded, and “programs to limit milk supply or impose penalties on producers should not be part of what is shaping up and on full display at Dairy Forum to be a very productive discussion about the future of our industry.”
