Washington Dairygrams - September 10, 2012



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

COW NUMBERS WERE DOWN 44,000 HEAD this July when compared to April’s nationwide peak of 9.27 million. As a result, milk production grew only 0.7 percent, the smallest gain over the previous year since last July.

MILK FLOW FELL IN A NUMBER OF WESTERN STATES. A combination of reduced plant capacity and high feed costs caused California’s output to drop 1 percent. Washington, Oregon, New Mexico and Texas also fell.

HIGH FEED COSTS are again taking their toll on all producers, especially those who buy a lion’s share of feed. Banks are keeping a close eye on all dairy loans. Some analysts predict more than 10 percent of dairies west of a line from Idaho to west Texas could go into receivership this year.

CORN YIELD IS PROJECTED TO BE 123 BUSHELS per acre, down nearly 24 bushels from last year, said USDA. It would be the lowest yield since 1995. Soybeans are expected to average 36 bushels, down 5.4.

$8.05 BUSHEL CORN WOULD BE IN STORE if yields were 128 bushels per acre, reported specialists at the University of Illinois. If yields fall to 120 or 115 bushels, corn could reach $9 to $9.60 per bushel.

NEARLY 80 PERCENT OF ILLINOIS CORN IS INSURED; similar coverage exists across the Corn Belt. Since 2003, the crop insurance program has had underwriting gains. However, losses could approach $15 billion this year, noted Kansas State University’s Art Barnaby.

2012 DAIRY EXPORTS through June were $2.7 billion, up 19 percent from a year earlier. As U.S. milk prices have climbed to cover higher domestic feed costs, world prices have not kept pace. This could slow U.S. exports.

NUMBER OF YOGURT PLANTS in New York jumped from 14 to 29 during the past decade. Last year, yogurt accounted for 1.2 billion pounds or 10 percent of the state’s milk. More milk is needed to meet expected demand.

TO ENCOURAGE MILK FLOW, New York could boost from 200 to 300 the herd size to trigger CAFO status, announced Governor Cuomo. With national CAFO limit at 700 cows, New York’s regs are still more stringent.

AT 33.7 POUNDS, CHEESE CONSUMPTION reached a new domestic per capita record last year. This marks the 11th straight year cheese consumption was over 30 pounds. Mozzarella experienced the most growth.

FLUID MILK USE CONTINUED DOWNWARD to 201 pounds per person which is the lowest since tracking began in 1909. Butter has rebounded, though, at 5.4 pounds of per capita consumption; the highest since 1968.

BRIEFLY: USDA declared nearly 1,800 counties as disaster areas; 1,670 due to drought. Two aid packages of $30 million and $170 million have been announced to date. New Zealand’s Fonterra exported 36 percent more product from May to July than it did last year. The CME Group has announced plans to create a similar exchange in the United Kingdom

Click here to see the previous months Washington Dairygrams