Washington Dairygrams - February 10, 2013


As printed in our February 10, 2013 issue...

YEARLY MILK FLOW TOPPED 200 BILLION POUNDS for the first time in the U.S. That represented a 2.1 percent or 4-billion-pound gain over 2011.

DECEMBER OUTPUT GREW 1.7 PERCENT with 15 of the 23 leading dairy states posting gains. California fell 2.3 percent compared to the same time last year; Wisconsin rose 5.5. Kansas led all gainers, up 10 percent.

U.S. DAIRY PRODUCT SUPPLIES continue to be relatively tight. However, Oceania’s output remained robust and has held world prices in check.

DAIRY FARMERS OF AMERICA (DFA) and four other affiliated defendants agreed to settle the Southeast Milk Antitrust Litigation before it was slated to go to trial. However, the co-op admitted no wrongdoing.

IT INCLUDED A $158.6 MILLION SETTLEMENT; when factoring Dean Foods’ $140 million, the recent agreement pushed the total payout to nearly $300 million in the antitrust case. DFA and the co-defendants also agreed to a number of changes in how business is conducted in the Southeast.

10.8 BILLION BUSHELS was USDA’s final estimate for the 2012 corn crop. Due to the drought, yields plummeted by 24 bushels per acre, from 147 to 123 bushels, when comparing the last two crop years.

MORE CORN WAS HARVESTED FOR SILAGE due to parched conditions. Overall 113 million tons of silage — 15.4 tons per acre — went through choppers. Yields fell by 3 tons compared to 2011; acres rose 24 percent.

WITH TIGHT CORN INVENTORIES, markets will be quite sensitive to any weather-related event throughout the 2013 growing season.

AT 17.3 MILLION ACRES, farmers harvested the fewest acres of alfalfa since 1948. A total of 52 million tons or 3 tons per acre came off fields last year, estimated USDA. New seeding rates rose 3 percent over 2011.

OVER $12 BILLION HAS BEEN PAID OUT in crop insurance claims, and that number was expected to keep climbing. Corn accounted for $7.8 billion; soybeans $1.6 billion and other crops totaled $2.9 billion.

OVER 3.1 MILLION DAIRY COWS WERE CULLED last year. The total represented only the third time since the 1986 whole-herd buyout program that 3-million-plus dairy cows were sent to packing plants.

DESPITE HIGH DAIRY CULL RATES, record beef prices are forecasted as production is projected to drop 5 percent this year. It would mark the sixth consecutive year global beef trended downward.

BRIEFLY: February to September Class III futures fell over 80 cents per cwt. since Christmas to a $17.83 average at the magazine’s close. California blend prices will go up by 25 cents per hundredweight from February 1 to May 31, announced the California Department of Ag. After TB was discovered in a Washington state cow, test results indicated all lactating herdmates were TB-free; testing is now taking place on replacements.

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