Washington Dairygrams - November 2012


As printed in our November 2012 issue...

FARMFIRST DAIRY COOPERATIVE would be the name of the merged cooperatives of Family Dairies USA, Manitowoc Milk Producers Cooperative and Milwaukee Cooperative Milk Producers. More details on page 744.

THE FUTURE OF THE FARM BILL was one of many topics discussed at National Milk Producers Federation (NMPF) annual meeting (see page 743). NMPF CEO Jerry Kozak predicted that the farm bill would be passed in the lame duck session of Congress set to begin on November 12.

KRAFT WILL REQUIRE PHASEOUT OF TAIL DOCKING by 2022 for all suppliers. However, the company will encourage early implementation and has endorsed other guidelines in the National Dairy FARM Program.

CLASS III PRICE TOPPED $21 IN OCTOBER. It was up $2 versus the previous month and $3 above the same time last year. Class III futures for December to May averaged just over $19 in early November trading.

THE MILK:FEED RATIO REMAINS LOW. However, at 1.68, it has reached the highest point since February 2012’s 1.56. October’s feed costs were $12.56 per hundredweight of milk with an income over feed cost of $8.54.

AT 91 PERCENT COMPLETE, the corn harvest was well ahead of the five-year average of 60 percent. A similar story for soybeans as USDA pegged 87 percent of the crop in the bin compared to the 78 percent five-year norm.

$6.95-PER-BUSHEL CORN was reported in USDA’s October issue of Agricultural Prices. That is $1.22 higher than the same time last year. Meanwhile, soybeans were $14.20 per bushel, up $2.40 from last year.

ALFALFA HAY SUPPLIES are expected to remain tight as the harvest was 9.8 million tons or 15 percent less than last year. Nationally, prices averaged $212 a ton with a high of $246 in Texas and $243 in New Mexico.

AS THE EASTERN SEABOARD was being ravaged by Hurricane Sandy, much of the Midwest still suffered from lack of rainfall. The U.S. Drought Monitor indicated 60 percent of the lower 48 states were still experiencing drought conditions; nearly 20 percent in the worst two categories.

DAIRY COW CULLING HAS GROWN 6.1 PERCENT or 131,000 head through this September when compared to the same time last year. USDA has projected that cull rates will slow for the remainder of 2012.

BRIEFLY: Credit availability continues to tighten in the West with a higher than usual number of bankruptcy filings and people considering leaving the dairy business. Dairy replacement prices continue a downward trend as October’s national average of $1,390 is nearly $100 less than the same time last year; $30 off from July 2012. The Kansas City Board of Trade was acquired by the CME Group for $126 million. Frustrated with California’s Department of Ag, the Western United Dairymen voted to work on advancing a bill to legislate a fix to the whey price.

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