Washington Dairygrams - February 25, 2013


As printed in our February 25, 2013 issue...

FOR THE 21ST STRAIGHT YEAR, cheese production posted a new record. It rose 2.5 percent (unadjusted for leap year) to 10.86 billion pounds.

AT 244.8 MILLION POUNDS, Wisconsin posted record cheese output, up 4.8 percent; representing 25.4 percent of the nation’s cheese, California 20.7.

FOR ONLY THE FOURTH TIME, the butter churn netted over 1.8 billion pounds. Last year’s butter make represented the highest level since 1941. Yogurt production totaled a record 4.45 billion pounds, up 4.2 percent.

ICE CREAM PRODUCTION DROPPED for the fifth straight year. From 1950 to 1988, ice cream consumption hovered between 17 and 18 pounds per person. Since then, it has slipped to 11.5 lbs., the lowest since the 1940s.

2012 DAIRY EXPORTS INCHED PAST the previous year: up 3 percent on a volume basis; 8 percent by value. In the second half of 2012, both volume and value were down 9 to 10 percent when compared to 2011.

GLOBAL PRODUCT PRICES ROSE 2.4 PERCENT in early February. The eight-product index averaged $1.63 per pound. Cheddar cheese traded at $1.60; that’s the midpoint for blocks and barrels on the U.S. spot market.

HIGH FEED COSTS continue to hamper profitability. January’s ration costs averaged $12.66 per cwt. with an income over feed cost at $7.34.

A $19.50 ALL MILK PRICE from 2013 to 2017 was the latest projection from USDA’s Agricultural Projections to 2022. USDA economists predicted cheese sales will continue to rise due to greater consumption of processed foods while fluid milk will lose more market share.

STRONG HEIFER INVENTORIES PERSIST. On January 1, there were 4.55 million head (500 pounds or larger) which is a ratio of 49.4 heifers per 100 cows. Replacements were valued at $1,370, down $110 since July.

FEBRUARY TO SEPTEMBER CLASS III FUTURES held steady in recent weeks to average near $17.90. Projected MILC payments range from June’s low of 27 cents to March’s high of 60 cents for the next five months.

BRIEFLY: Tuberculosis was detected in a West Coast cow for the second straight month. This time in Tulare, Calif. Only a 25 percent chance to pass a farm bill before year’s end, suggested the American Farm Bureau’s Mary Kay Thatcher. When it expired last year, no one really noticed except dairy, she said. About 20 of the nation’s 211 ethanol plants ceased refining over the past year, reported the Boston Globe. Bred heifer exports fell 41.2 percent or by 30,000 head in 2012. Russia and Kazakhstan grew imports; Turkey and Mexico were down. The Canadian Food Inspection Agency released a new dairy-farm biosecurity standard. It focused on animal health and movement, premise sanitation and people flow. USDA announced final rules for Class III and IV make allowances. It would complete a process that began in August 2008.

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