Washington Dairygrams - March 10, 2012


As printed in our March 10, 2012 issue...

MILK PRODUCTION WAS UP 3.4 percent nationwide over a year ago in January. Cow numbers rose 76,000 head (+1 percent) from last year and 13,000 from December. Nation’s herd numbered 9.236 million cows.

ALL TOP 23 DAIRY STATES WERE UP except for Vermont, down 0.5 percent. California rose 6.6 percent, Wisconsin (+3.7), Idaho (+4.7).

GREATER MILK FLOW put downward pressure on the markets. March to December Class III futures fell over 55 cents since early February trading and averaged $15.93 at the magazine’s close. Block cheese at $1.48.

EXPECT MILC PAYMENTS to return based on high feed costs and sluggish milk prices. A 50 cent-per-hundredweight payment could occur in March. Projected payments may reach 70 to 80 cents from April to June.

TO MANAGE PLANT CAPACITY, the Northwest Dairy Association has established a temporary production base for each cooperative member in Washington and Oregon. It will apply volume assessments to excess milk.

BASE WAS DETERMINED by each producer’s highest monthly production in the previous three years. Initial program to run from April to July.

DAIRY EXPORTS ACCOUNTED for 13.3 percent of U.S. milk solids during 2011. That compared to 12.8 percent in 2010; 9.3 percent in 2009; and 11 percent in 2008. Global shipments could soften in 2012.

VALUE OF EXPORTS TOTALED $4.82 billion in 2011, up 30 percent from the previous year. Mexico became nation’s first $1 billion dairy customer.

AMERICA SENT A RECORD $136.3 BILLION in farm products overseas last year. Total ag exports grew 18 percent. Dairy’s share was 3.5 percent.

CLASS I UTILIZATION in federal orders was 35 percent last year. Class II, III, and IV marketings were 11, 44, and 10 percent, respectively.

CONSUMING RAW MILK or products made from unpasteurized milk are responsible for most disease outbreaks, concluded a Centers for Disease Control study. Risks go up 150-fold when compared to pasteurized products.

FURTHER DROP in pick-up tanker milk samples testing positive for antibiotics . . . 671 out of 3.2 million or 0.021 percent. It set an all-time low.

A PARTIAL SETTLEMENT in an antitrust milk lawsuit reinstated by a U.S. District Court Judge for over 7,000 Southeast dairy producers.

BRIEFLY: The Commodity Futures Trading Commission instituted new rules that require investment companies to register before making trades in futures markets. Dairy futures activity on the CME was up 32 percent compared to last January. MILC payments could be extended one more year in a bill introduced by Vermont representatives. Under current law, MILC will expire this October. Exports of dairy replacement almost doubled last year to 73,639 — Turkey imported 68 percent.

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