Archive for Dairy Industry

The Future of the Dairy Industry in Scotland

Must-attend events for Scottish dairy farmers in July

Scottish dairy farmers are being urged to attend meetings on the future of dairy farming in Scotland being held in early July.   

The must-attend meetings, being held in Kinross (3 July); Thainstone (3 July); Castle Douglas (4 July) and Renfrew (4 July) are in anticipation of the UK Government’s consultation on the regulation of contracts between dairy farmers and processors.

The consultation is likely to be the most significant for the industry since deregulation of the milk industry 25 years ago.

Government has acknowledged that there is a need to improve stability in the dairy supply chain by addressing bargaining power, contract terms such as exclusivity, trust and transparency.  

The seminars, which are open to all, will help inform farmers and other stakeholders of the potential for change in the dairy sector and will be led by well-informed experts from NFU Scotland, NFU England and Wales, AHDB and Scottish Government.

Speaking on the first day of the Royal Highland Show in Edinburgh (20 June), NFU Scotland Vice President Martin Kennedy said: “This is the start of the most important conversation with dairy farmers and other stakeholders in a quarter of a century.   

“UK farming unions have a strong desire to work with farmers, processors and retailers to develop the type of relationships which will drive fairness, efficiency and competitiveness in the UK dairy sector, making it fit for purpose for decades to come.

“The voluntary code on milk contracts, agreed in 2012, covering dairy contracts, has disappointingly fallen short of expectations and Government now sees a need for some form of statutory requirement to secure more equitable, progressive dairy contracts between farmer and processor.

“These seminars are the beginning of an ongoing discussion to agree what an effective milk contract should cover and how this is agreed.  I urge every dairy farmer in Scotland, where possible, to get involved and feed in their views.  It’s your dairy industry and it’s your future.”  

 

Source: NFU Scotland

Several buyers interested in purchasing Fonterra’s Dennington factory

A Fonterra spokeswoman said interested buyers had approached the milk processor after the company announced in May it would close the site later this year.

“We have been contacted by several non-dairy companies that have expressed interest. We are talking with them; however these discussions are commercial in confidence,” she said. 

The company said at the time of announcing the shutdown that it had explored all options for the site, including selling it, but there had been no genuine interest.

South-West Coast MP Roma Britnell, who had accused the company of “mothballing” the site, said she was aware of several interested buyers from the dairying industry. 

Ms Britnell said she met with Fonterra on Friday to discuss the site’s future options.

“My focus is the Dennington site and keeping it open, it is an important site for our community and if we can see that continue to be operational that’s what we are looking for,” she said.

“It is looking promising, I am hopeful for a positive outcome.” 

Fonterra milk supply general manager Matt Watt said the company was preparing to exit the site and exploring plans for possible environmental remediation.

“With local community groups and stakeholders we are going to have to make sure that whatever it looks like post (November), it’s in the shape people expect it to be,” Mr Watt said.

Focusing on what works

CLOSING Dennington will allow Fonterra to better utilise its remaining assets, milk supply general manager Matt Watt said while visiting the south-west.

Mr Watt said limited milk supply, drought, and the under-utilisation of the Dennington plant were the key reasons for the plant’s closure.

But he said the closure allowed Fonterra to focus on the “the stuff that works” which includes the high-value Western Star butter produced at Fonterra’s Cobden factory which attracts 200,000 new consumers a year.

“By putting milk in Dennington, it doesn’t create the same level of value as putting milk into Cobden and producing something like Western Star”,” Mr Watt said.

“So we make the choice that says ‘actually we are just going to double down on the stuff that works’.

“There are bits of our business in a smaller milk pool that aren’t as relevant and aren’t working.”

He also confirmed that milk was flowing out of south-west Victoria to Fonterra’s modern milk processing facility in Stanhope, increasing competition on the Dennington plant, but added it was “by no means the majority”.

“Over the last 12 months we have certainly seen milk move that way,” Mr Watt said.

“We have times where factories here will be shut, and that will increase with only having one plant here. We will be saying ‘where do we best allocate that milk?”

Mr Watt ruled out future risk to the Cobden plant, which he said was a “corner stone” of Fonterra’s Australian operations.

“Western Star is its forte. It also has powder-drying capability, and it’s a beverages plant. It’s a corner stone plant in terms of what we do,” he said.

“We have made our decision around our network, and what that does is make the rest of the network, and Cobden especially in this region stronger.”

‘Increase your milk price’

FONTERRA will review its opening milk price after suppliers called for a step-up at meetings in the south-west this week.

Farmers told Fonterra Australia’s managing director Rene Dedoncker and general manager Matt Watt in Warrnambool and Camperdown this week that they expected a step-up following announcements of competitors’ prices, some as high as $7.20.

Mr Watt said the company had announced its 2019-20 $6.60 a kilogram of milk solids opening price in May to give farmers certainty ahead of the new season.

“We have seen others come out with their prices and they have been high. We are going to have to respond to that,” Mr Watt said.

“We are reviewing that now, and we have said to farmers you can expect us to be competitive and you can expect to see that soon.” 

He said the business had between 250 and 300 south-west suppliers and the roadshow was an opportunity to discuss the “challenging” setting the industry faced.

“It’s clear it’s been a very challenging 12 months across the industry with droughts and changes,” Mr Watt said.

“We would expect to see production in the next 12 months to be lower than this last 12 months.”

Some farmers also have 12 months remaining on controversial ‘claw-back’ loans they received following Fonterra dropping its milk price in 2016, meaning a percentage of farmers could choose a different supplier when the loans mature.

“In terms of the loans itself, that’s around 20 per cent of our supply base,” Mr Watt said. 

“Now that’s significant, but I would say, if you look at the Dairy Australia stats, across the whole industry, 25 per cent of milk moved last year. 

“So that just reflects that the whole market is competitive and whether that’s this year or next year whether the loans expire, our farmers are going to have to see a bottom line return.”

Farmers make decisions for next season

WITH one-in-four of Australia’s dairy farmers choosing a new processor this year, farmers are looking at options for next season.

Dairy Australia says in 2019, 25 per cent of farmers changed processor, compared to 10 per cent in 2015. The number one reason was milk price.

Kennedy’s Creek Fonterra supplier Allan, who did not want his surname published, said he and others at the Camperdown meeting had pushed for a price step-up.

“They got the message and they reckon they are going to review it by the end of the week,” he said.

Allan said any price changes in coming weeks could determine if he remained a Fonterra supplier.

“I am under no contract so I can do what I like, it’s an open market,” he said.

Princetown Fonterra supplier Eva Vickers said she had supplied four different processors in the past two decades, but she had no plans to leave Fonterra. 

“If we think something affects our business to its detriment we will move,” Ms Vickers said.

“Fonterra have actually paid reasonably well in comparison over the last couple of years. They haven’t been at the bottom of the heap every year, I don’t think there is any reason to be looking elsewhere.”

South Purrumbete dairy farmer Adam Jenkins, a former Fonterra supplier, said trust between milk processors and farmers was taking time to rebuild following the dairy crisis and ongoing climate challenges.

“There’s no doubt that farmers are feeling very jaded over the last number of years. Yes we enjoy the competition. But the trust and transparency and the complication of the pricing and the special deals … and with fires and drought, people have reviewed their assets,” Mr Jenkins said.

But he said headline milk prices were of secondary importance to choosing a pricing structure that best suited farmers’ grass curve.

“Our farms business will look at maximising the grass that we have that maximises our profit. We are not interested in chasing a $7 milk price if it’s going to cost us $7.20 to produce it,” Mr Jenkins said. 

 

Source: The Standard

Two Minnesota Holstein Association Members Run for Region 6 National Director

The Minnesota Holstein Association is proud to have two members that are running for the Holstein USA Region 6 Director position. Elections will be held at the 2019 Holstein Association USA, Inc. Annual Meeting on Wednesday, June 26, 2019 for officers and directors in Regions 1, 4, 6 and one at-large director. Any unsuccessful regional director candidate may run for the one at-large position.

On behalf of your fellow Holstein enthusiasts from Minnesota, we would like to introduce the two highly-qualified Minnesota candidates running for the National Holstein Board of Directors. Each of these upstanding Registered Holstein breeders continue to put forth elite genetics and unique breeding philosophies that shine in the barn and in the show ring. Their leadership in the industry and in their communities only complement their extensive accolades and speaks to the high level of character they each possess. Both continuously support the State and National Associations through their active participation in Holstein events. Multiple generations within our membership have benefited from the mentorship and advisement of each individual, as well as their willingness to tackle current issues facing the dairy industry and the Holstein cow. The Minnesota Holstein Association is proud to present both hardworking and dedicated individuals as candidates for the National Holstein Board of Directors:

Spencer Hackett – Rice, MN Mike Schiller – Freeport, MN
Background:

  • Spencer and his wife Stacey, alongside their two sons operate Melarry Farms.
  • Currently milk 170 cows and farm 1,000 acres

Leadership in Holstein:

  • 2019 MN Holstein Show/Sale/Futurity, committees
  • 2019 HAUSA Genetic Advancement Committee
  • 2001-2011 MN Holstein Board Member
    • President (2 years)
    • Executive board (5 years)
    • 2005 President’s Award, recipient
    • Breed Activities (Chair), State Sale (Vice Chair), Junior Activities, State Show
  • Spencer also serves on two local co-op boards, 4-H livestock and auction committee volunteer.  The farm hosts farm tours, as well as showing, fitting, and judging workshops.

Holstein Achievements:

  • Melarry Robust Miles-ET – 2016 Gold Metal Sire
  • Melarry Josuper Frazzled
  • 2005 National Distinguished Young Breeder
  • 2011 PDCA Distinguished Breeder
  • Markets genetics domestically and internationally
Background:

  • Mike and his wife Karen, alongside their son Charlie operate Schillview Holsteins.
  • Currently milk 100 cows and farm 380 acres

Leadership in Holstein:

  • 2019 MN State Holstein Sale, committee
  • 1990-1998 MN State Holstein Board Member
  • Associated Milk Producers (AMPI)
    • Corporate Board (12 years)
  • 2014-2019 World Dairy Expo, Board of Directors
  • Stearns County Holstein Association, member
  • Mike also serves as his township supervisor (9 years) and has hosted various events involving barn meetings, Holstein classification seminars, dairy cattle judging contests, fitting workshops,and  farm tours. Schillview Holsteins shows at county, state, and national competitions.

Holstein Achievements:

  • 2007 MN Livestock Breeders Association
    • Hall of Fame, Inductee
  • 2009 Minnesota Distinguished Holstein Breeder
  • He has marketed embryos and A.I. bulls to several foreign countries

 

Source: Minnesota Holstein Association

Dairy Farmers Are Closing Up Shop. A Rite of Summer That Celebrates Them Lives On.

Thousands of people in Wisconsin visit farms each June for a tradition known as the dairy breakfast. In one county where the industry struggles, two families kept the breakfast going.

It was just shy of 5 a.m. on Saturday, and a determined crew of volunteers fanned out across the farm on Creamery Creek. Men mixed pancake batter in buckets. Daisies were arranged in vases on long tables. The smell of Folgers wafted through the tents.

Soon, a rural traffic jam materialized like something out of “Field of Dreams,” a long line of cars snaking through the countryside to reach the farm.

They came for the county dairy breakfast, which, like many Wisconsin traditions, is fiercely cherished within the state and mostly unknown outside of it. The annual early-summer gatherings are held across the state, with thousands of people showing up at a farm at dawn to socialize over a spectacularly lactose-rich spread of milk, yogurt, cheese curds, scrambled eggs, pancakes and sausage. For dessert, there is ice cream or frozen custard, often topped with local strawberries.

In rural Wisconsin, the dairy breakfast is as indispensable as a Fourth of July parade, an annual tradition that celebrates a common bond and gathers neighbors together.

This one almost didn’t happen.

Last year was a brutal one for dairy farmers in Wisconsin, as the price of milk slumped, cutting into profits. Many farmers simply gave up. Five years ago, there were 96 dairy herds in La Crosse County, where Creamery Creek Holsteins, the farm named for the stream that runs through it, sprawls across 2,200 acres. Now, there are 60.

Video

 
Credit

When the committee that plans the annual La Crosse County dairy breakfast met this spring, the members came to a crushing realization: No farmer had stepped forward to host and, with time running out, the breakfast would have to be called off.

“The dairy industry in Wisconsin is struggling to keep afloat, and our farmers in La Crosse County are not immune to this,” the committee posted on its Facebook page. “We remain hopeful that things will turn around and our farmers will pull through.”

Megan Hansen, a 21-year-old dairy science major at the University of Wisconsin whose family is an owner of Creamery Creek, called it the “woe-is-the-dairy-industry message.”

“I texted my dad and said, ‘We have to do this,’” she said.

Mark Hansen, her father, immediately agreed. “I got a tear in my eye reading that text,” he remembered.

Phone calls were placed. Family meetings were convened. Back-of-the-envelope calculations were made. Louisa Peterson, whose family co-owns the farm, was also unwilling to let the dairy breakfast die. Creamery Creek, which had hosted in 2018, would do it again, she announced.

More than 3,000 people were expected, and she had less than 12 weeks to prepare.

By the morning of the breakfast, the farm had been neatened. Antique tractors were on display. An old alfalfa field was now a parking lot.

When the color guard marched down a gravel road and fired a salute to begin the festivities, a line of cows in a nearby barn — tagged with numbers and names like Milkshake and Galapagos — startled and jumped to their feet. (Even cows know to stand at attention, a Marine in attendance said.)

“You have commanded us to work the land and cultivate it,” said the Rev. Raja Kennedy, a Roman Catholic priest, leading a prayer. “Your devoted people now pray that you will grant us an abundant harvest from our flocks, fields, vineyards and orchards.”

“Amen,” the crowd murmured.

Image

Creamery Creek Holsteins is the largest dairy in the county. Ms. Peterson and her husband, Justin, both 38, met as undergraduates at Michigan State University and moved to western Wisconsin in search of the farming life. In 2010, they partnered with the Hansen family, who had been farming their land since the 1930s.

The farming was different out here, Ms. Peterson quickly realized. The Driftless region of Wisconsin, which the glaciers missed during the ice age, is marked by river valleys and bluffs, so farms tend to have less room to spread out.

Creamery Creek is an exception, a relative behemoth with 675 cows and 11 full-time employees. All four Peterson children pitch in with chores around the farm.

Louisa Peterson, left, with her husband, Justin, and their children at the dairy breakfast.

Image

Louisa Peterson, left, with her husband, Justin, and their children at the dairy breakfast.

On the day of the breakfast, Ms. Peterson, friendly and unflappable, was a jack-of-all-trades — decision maker, problem solver, farmer.

“If this is the only farm people ever visit, if this is the only farmer they ever meet, what do I want them to see?” she said. “That’s why I do the breakfast.”

Image

At 7 a.m., a three-person band began playing “Stand by Me.” (They would have come earlier, Ms. Peterson said, but they had to milk their own cows.)

The breakfast tends to have different meanings for people, depending on where they stand on the generational ladder. Those who have been coming for decades often grew up on a farm and like the excuse to come back to one.

For younger families who live in the college town of La Crosse, the breakfast is more of an agri-tourism activity, an opportunity to show their small children how a cow is milked and where food comes from.

Image

Dale Kirchner, 84, grew up on a farm in Mindoro and worked for the local agricultural co-op for 52 years. When he was a boy, there were 34 dairy farms in the valley where his parents farmed, he said. Now there is one.

It used to be that nearly everybody worked in the same business, said his wife, Betty. Hollywood has film. Washington has politics. And this part of Wisconsin had dairy.

“There are so many scary changes, but you just have to accept them,” she said, checking on a vat of coffee. “You can’t be bitter. It’s just progress.”

Image

Betty Kirchner.

Image

Dale Kirchner.

Then there is the rising generation on the farm, full of ambition and ideas.

Megan Hansen is studying agriculture, and like many young would-be farmers, she plans to get an advanced degree.

“A lot of people tell me, ‘You shouldn’t go into this,’” she said. “But I want to do something to help the industry.”

She was an ambassador of sorts for the business on Saturday, watching the birth of a heifer calf that attracted a crowd of onlookers and feeding a 3-day-old calf a mixture of electrolytes and water.

Image

 

Image

 

“It’s like Gatorade for cows,” she said.

Jeff Heitkamp, chairman of the dairy breakfast committee, was running on about 30 minutes’ sleep on the day of the event, after being consumed for weeks by the planning process. He keeps doing the work for its own rewards, even though he was recently laid off from his job as a salesman in the agriculture business.

Jeff Heitkamp and Ms. Peterson.

Image

Jeff Heitkamp and Ms. Peterson.

Mr. Heitkamp grew up on a farm in East Dubuque, Ill., and has never worked in another field. He is considering two job leads right now — one of them in a different business.

“I don’t know if I’ll still be in the dairy industry down the road,” he said. “So many farms are selling out. I’d like to stay. But it’s getting harder and harder.”

As the lines dwindled and guests left the farm, Ms. Peterson, finally able to relax, took her first bite of food all day — a spoonful of frozen custard. She has already volunteered to host another dairy breakfast, but for a notably far-off and specific year, 2032, when the farm would celebrate its 100th birthday.

Most of her children will be grown by then. The oldest, Joseph, who is 12, has “an incredible sense of duty,” she said, doing chores without complaint.

He says that he wants to be a priest, another job that is sorely needed in La Crosse County, where their pastor shuttles between parishes.

Ms. Peterson is supportive of whatever her children someday decide to do, she said, especially if one of them goes into the dairy industry.

New USDA Program, Other Assistance, About to Kick in for America’s Dairy Industry

Each June, we celebrate National Dairy Month! Since 1937, this month has been set aside to mark the importance of the dairy industry and the products it produces to America’s agricultural sector and to hundreds of millions of Americans and consumers around the world.

Many of the country’s 37,000 dairy farms are family-owned, and more than 3 million jobs are supported, with $38 billion in direct wages for workers, by the U.S. dairy industry.

Times are tough for America’s dairy industry. Costs are high, and margins have been squeezed. In fact, the dairy industry is now in its fifth consecutive year of low prices, which – at least in part – prompted more than 2,700 dairy farms to go out of business in 2018 alone.

Dairy Margin Coverage Program

USDA is working to support dairy producers. One way is through the Dairy Margin Coverage (DMC) program, which producers can begin signing up for this week. The signup began Monday and runs through Sept. 20. USDA has partnered with the University of Wisconsin-Madison to provide a DMC decision tool that will help producers make coverage choices that will best benefit their individual dairy operation.

Want to Sign-up?

Through the provisions of the 2018 Farm Bill, dairy producers will be eligible for coverage retroactive to January 1, 2019. It’s expected to be a vast improvement over the former Margin Protection Program for Dairy (MPP-Dairy), with lower premiums.

The DMC program offers protection to dairy producers when the difference between the all-milk price and the average feed cost (the margin) falls below a certain dollar amount selected by the producer. So far this year, DMC payments have triggered in January, February, March and April.

The 2018 Farm Bill also allows dairy producers who had been covered and paid premiums under MPP-Dairy to be eligible for reimbursements. An operation either can receive 50 percent of the reimbursement amount as a cash refund or take 75 percent of the amount as a credit toward premiums for DMC. Producers must make repayment elections by September 20, 2019.

Implementing the 2018 Farm Bill

FSA and other USDA agencies are working diligently to implement the new programs and policies of the 2018 Farm Bill. DMC was the first large implementation effort of FSA because we recognize the importance of making this program available to dairy producers.

Producers interested in learning more about the program should contact their local FSA county office. Additionally, FSA is planning outreach meetings in some local communities to help with sharing information and answering questions on the new program. Learn more on the DMC webpage as well as by listening to this June 17 webinar.

WA dairy farmer announced as Holstein Australia Youth UK Exchange winner

Fourth-generation dairy farmer, Tahlia McSwain, from Chapman Hill in Western Australia has been announced as the 2019 Holstein Australia Youth UK Exchange winner. Funded by Holstein Australia, in partnership with Holstein UK, the exchange begins in late September.

Tahlia will spend a month travelling the length and breadth of Britain staying and working with Holstein UK members, and will also take part in the South West Dairy Show, the UK’s largest dairy show, and the All Britain All Breeds Calf Show. The All Breeds All Britain Calf Show is one of the highlights of the UK’s Holstein Young Breeders calendar, featuring showmanship & calf conformation classes for seven dairy breeds.

The focus of Tahlia’s trip will be learning, practical on-farm experience, skills development and networking. She will gain first-hand knowledge of dairy farming in the UK and is planning to use that information to further her own career in the family business, Boallia Creek Holsteins.

Twenty-four year old Tahlia is a Western Dairy Young Dairy Network committee member, Southern Districts Rural Ambassador and graduated from Charles Sturt University with a Bachelor of Agricultural Business Management. She holds a Certificate III in Agriculture through the National Centre for Dairy Education Australia.

In conjunction with her parents, Kingsley and Judy, Tahlia runs Boallia Creek Holsteins, milking 600 Holsteins on the 800-hectare property. The farm has been in the McSwain family since 1930 when Ms McSwain’s great-grandfather moved from Victoria to set up the farm with humble beginnings – six Jerseys and 38 hectares as part of the WA Government’s group settlement farm program.

Tahlia’s passion in the business is in the breeding and genetic selection of her animals and the science of improving overall milk quantity and quality. She is also focused on the many changes facing the industry and how the next generation of dairy farmers will need to adapt to meet an environment shaped by a changing climate and animal welfare issues.

“I’m really excited to be heading to the UK in September and looking forward to gaining a real insight into the differences and similarities in the Holstein world between the two countries.

“Visiting Holstein operations overseas, understanding the way they farm and operate, is a fantastic opportunity. In an ever-changing world with technology in farming becoming more and more important to meet the challenges my generation will face, seeing the technologies available in Europe will allow me to bring back ideas for the future of Boallia Creek,” says Ms McSwain.

Graeme Gillan, Holstein Australia CEO, says Tahlia’s passion, knowledge and commitment to the dairy industry, the Holstein breed and the family business were key in her selection for the exchange.

“Our interview panel were impressed with Tahlia’s vision, and how she intends to use the experience she gains in the UK to further both her dairy career and the family business. She will be a great ambassador for the next generation of the dairy industry in Australia overseas.

“Interest in the Holstein Australia Youth UK Exchange continues to grow, with a record number of applicants this year. Overall the calibre of applicants was very high, and if this is representative of our future dairy farmers and industry leaders, I think the Australian dairy industry will be in very good hands,” says Mr Gillan.

The return leg of the exchange program will take place in early 2020 with a young UK dairy farmer spending a month working with Holstein Australia members in Victoria, South Australia and Western Australia, taking in International Dairy Week and a dairy youth camp.

 

Source: NewsMaker

Westland Milk boss promised $680k bonus if sale to Chinese goes through

Westland Milk Products chief executive Toni Brendish has been criticised for a “huge conflict of interest” over a $680,000 bonus if the co-operative is sold to Chinese company, Yili.

Bonuses will also be paid to other top management including $360,000 to its chief operating officer, $302,700 to its general sales manager and $100,000 to its chief financial officer.

Otago University senior accountancy lecturer Dr Helen Roberts said it appeared Yili was willing to pay the management to encourage farmers to sell their assets, raising a conflict of interest.

“If you were in that position would you say no?

“It’s a problem with these kinds of ownership structures where the management is supposed to represent the best interests of the true owners, but they have a conflict because they have their self-interest vested in their remuneration,” Roberts said.

Harihari farmer Jon Sullivan accused the Westland board of “taking the p…” out of farmers and that the sale was against New Zealand’s interests.

The bonuses are to be paid by Yili if farmers vote in favour of the sale on July 4 of the century-old company that is the West Coast’s biggest industry and employer.

The average West Coast farmer will receive $500,000 cash, plus the Fonterra equivalent payout price for the next 10 years. State-owned corporate farmer, Landcorp, will receive $11 million for the 3.25m shares it holds.

Brendish is paid $1.1m a year, and 16 further employees receive more than $200,000.

For years the co-op has struggled to make a profit, last year finally managing to run into the black with a $3.3m profit before tax.

Controversially in 2016 former boss Rod Quin was handed a departing bonus of $290,000, despite the co-op recording an after-tax loss of $14.5m.

Agriculture Minister and West Coast-Tasman MP Damien O’Connor has described the bonus deal as “outrageous and an insult to farmers”.

However, Westland board chairman Pete Morrison, who was paid $142,500 for his governance role, has defended the promised bonuses.

He said they were negotiated when the offer was made last year by Yili, and were standard to stop top management from leaving during the sale process, and would be made only if the deal went through.

“If senior executives left during the process it would have presented a picture of instability and that would have undermined possible interest and proposals,” Morrison said in a statement.

Management were also not involved in selling the sale to farmers and other stakeholders.

Sullivan said the $500,000 being offered to the average farmer had to be put into context.

“Last year I was $300,000 behind the price paid to Fonterra farmers and we’ve had that for the last few years, so the $500,000 is just a fraction of what we’ve missed out on.”

He also queried the role of Australian investment banker Macquarie, which is managing the sale. It would receive at least $5.8m if the sale did not go ahead, and much more if it got across the line, but the amount had not been disclosed.

Sullivan complained shareholders had not been given enough time to scrutinise the sale. He hoped it would be opposed and a “ruthless” person would be appointed to turn the co-op around.

Roberts queried whether Brendish would also have been promised the carrot of a continuing chief executive role at Westland.

“Someone’s going to have to manage it, at least be an interim manager, the new owners won’t know everything they need to know,” Roberts said.

The deal was likely to be a good one for the Chinese buyers because they knew the demand for high quality milk products in China and they would have direct access to the market there without having to go through a lot of red tape.

“Even though it might seem they’re paying a lot, in the long term they’ll make money,” Roberts said.

 

Source: Stuff

USDA aims to help dairy farmers with new insurance program

The number of dairy farmers across America has dwindled significantly in recent years. Low milk prices and high feed costs are the primary culprits.

Now, there’s a new United States Department of Agriculture (USDA) insurance program that promises to bring some stability. It’s called the Dairy Margin Coverage program.

The USDA Farm Service Agency hosted a meeting in Oronoco Monday to educate local dairy farmers about the program and answer any questions.

“Essentially what it is, is it’s an insurance program so producers can ensure some profitability for their dairy,” said Rich Bauer, USDA Farm Service Agency County Executive Director.

Under the 2018 Farm Bill, the USDA was able to construct the program with the goal of creating some stability for these farmers.

“We look at the national milk price is and we compare that to the feed cost of producing 100 pounds of milk,” said Bauer. “You can insure up to a $9.50 margin and whenever it gets over a $9.50 margin then we will start subsidizing that difference.”

So, if feed costs get extremely high or milk prices get extremely low in relationship to feed costs, then the USDA’s Farm Service Agency is able to step in and help.

This will replace the previous program known as the Margin Protection Program for Dairy.

“It’s similar to the last program but it’s improved,”said Bauer. “The fees are less and the coverage is more.”

Farmers across Olmsted County have been feeling the pressure to make ends meet the past few years. They know this isn’t a permanent solution, more of a temporary fix.

“It will help,” said dairy farmer Donny Thompson. “Just looking at the number, it’s not going to keep us in business but it will help.”

“I mean every little bit helps I guess,” said dairy farmer Corey Hoffman. “Like every farmer, not just dairy producers, we hope to get a decent price for our product that way we aren’t asking for a government handouts all the time.”

Farmers can participate year to year or lock in for five years.

Sign-up goes from June 17th until September 20th.

In case you missed Monday’s meeting, there will be three more this week:

Tuesday, June 18th; 1 p.m. at the Dodge County Farm Service Agency Office
Wednesday, June 19th; 1 p.m. at the Oronoco Peoples Energy Coop
Thursday, June 20th; 1 p.m. at the Dodge County Farm Service Agency Office

For more information about the Dairy Margin Coverage program, click here.

 

Source: Fox47

Marc Comtois Among Six Inductees for 2019 Canadian Agricultural Hall of Fame

Six exceptional Canadians have been selected to join the Canadian Agricultural Hall of Fame as 2019 inductees in recognition for their lifelong contributions to the agricultural sector. JoAnne Buth, Marc Comtois, Cynthia Grant, Louis Latimer, Laurent Pellerin and Robert Prestage will be officially inducted into the national Hall of Fame at a ceremony on Thursday, November 28, 2019 at the Fairmont Le Chateau Frontenac in Quebec City, QC.

“This was another year of outstanding nominations from across Canada and across all sectors of Canadian agriculture.  The individuals being inducted have definitely left their mark on Canadian agriculture,” said Guy Charbonneau, president of the Canadian Agricultural Hall of Fame Association (CAHFA). “Every one of our inductees this year has worked tirelessly and collaboratively to create lasting new opportunities for Canadian agriculture – from nutrient management to livestock genetics to organizations. With a record number of inductees for 2019, the CAHFA board has selected “la crème de la crème” – leaders who have left their mark and many who continue to contribute to the world class reputation that all of Canadian agriculture can be proud of.”

A pillar of the Canadian Holstein industry, Marc Comtois is the man behind the famous Ferme  Comestar – a Quebec-based dairy farm that’s been changing the face of dairy genetics around the globe for the last four decades. A farmer, promoter, mentor, marketer and judge, Marc has travelled the world in his drive to propagate the most outstanding dairy genetics through his Comestar family for the benefit of other Holstein breeders in Canada and around the world. Marc’s accomplishments as a Holstein breeder are legendary, beginning with his famous Comestar Laurie Sheik – the cow that launched the line and continues to deliver champion genetics seven generations later. Marc Comtois lives in Victoriaville, QC and was nominated by Holstein Québec, Holstein Canada and Semex Alliance.

Passionate leader, advocate and public servant, JoAnne Buth has made a lasting impact on a broad range of the agricultural landscape. Her reputation and leadership have impacted Canadian agriculture through her work in research and development at DowElanco to her roles as vice president and then president of the Canola Council of Canada. JoAnne served the agriculture sector and her home province of Manitoba on the Canadian Senate for two years. Since 2014, she has been the CEO of the Canadian International Grains Institute. JoAnne Buth lives in Winnipeg, MB and was nominated by Emerging Ag and the Canadian Canola Growers Association.

An accomplished scientist and skilled communicator, Dr. Cynthia Grant recently retired from a career with Agriculture and Agri-Food Canada and is nationally and internationally known for her work on soil fertility and crop nutrition. Cynthia is respected across Canada and around the world for her contribution to Canadian agriculture, and her collaborative research efforts on soil. Her research provided the scientific foundation for the Made-in-Canada 4R nutrient stewardship framework to use crop nutrients from the right source and at the right rate, time and place. Cynthia Grant lives in Minnedosa, MB and was nominated by Fertilizer Canada.

A visionary pioneer, the late Louis Latimer leaves the legacy of developing a global demand for Canadian beef genetics. Louis was a trailblazer in using data-based selection methods and seeing the value of telling the story of his farm with his Remitall Cattle Company brand – a marketing move that was decades ahead of its time. His passion for breeding and marketing premier Canadian Hereford genetics opened market opportunities for elite genetics from his farm, and decades later led to the Canadian Genome Project selecting one of his sires to be the most influential sire genetically in the Canadian Hereford Association. Many other Canadian breeders followed Louis’ model, helping elevate the overall quality of Canadian beef genetics. Louis Latimer lived in Olds, AB and was nominated by the Canadian Hereford Association.

A tireless champion and man of solutions, Laurent Pellerin dedicated his 40-year career advocating for farmers through his leadership roles at provincial, national and international organizations. A proud hog farmer at heart, Pellerin has created partnerships and alliances to benefit the largest number of producers. His accomplishments for Canadian agriculture include roles as president of the Pork Producers Federation of Quebec, leading the creation of the Centre for Swine Production Development in QC, president of UPA, founder of the Council for Agricultural Development of Quebec, vice president of the Canadian Federation of Agriculture, and president of the Farm Product Council of Canada. Laurent Pellerin lives in Becancour, QC and was nominated by the Quebec Farmers Union (Union des Producteurs Agricoles du Québec) and the Quebec Pork Association (Les Éleveurs de Porc du Québec).

A strong leader and excellent ambassador, Robert (Bob) Prestage dedicated decades to improving the genetics and quality of Canadian cattle to open international markets for Canadian beef and other livestock. He began by developing a progeny test program for beef cattle 60 years ago – a program that is still used across the country. His work with Canadian Beef Sire and Western Breeders improved the genetic pool of Canadian beef cattle. Bob was instrumental in creating a worldwide beef export network with the Alberta Angus Association, raising Angus to the dominant breed in the beef industry. Through his Wicklow Angus farm, Bob has a thriving international export business of semen and embryos of all species of livestock. Bob Prestage lives in Camrose, AB and was nominated by the Canadian Angus Association.

The Canadian Agricultural Hall of Fame Association (CAHFA) honours and celebrates Canadians for outstanding contributions to the agriculture and food industry. Portraits are on display in the Canadian Agricultural Hall of Fame Gallery located at the Royal Agricultural Winter Fair. The CAHFA also publicizes the importance of inductee achievements to Canada. The Association was organized in 1960 and is administered by 12 volunteer Board of Directors residing in regions across Canada.

May US Milk Production Up Slightly But Down Year Over Year

According to USDA, May Milk production was up on the month but down slightly on the year, but was down four-tenths of a percent from last year to 19 billion pounds with production per cow up 12 pounds. The herd size was down 89,000 milking cows from last May but up 5,000 from the prior month. Michigan continues to have the most productive cows in the nation. Virginia and Illinois had the largest decrease in milk production; Texas and Colorado had the largest increase. 

 

Costs and weather hit Australian dairy farmer confidence and profits

Costs are crippling the nation’s dairy farmers with only a third positive about the future of the industry.

That’s according to the latest Situation and Outlook report released by Dairy Australia today which surveys 800 farmers nationally and provides an insight into global and domestic markets.

The report revealed only 34 per cent of dairy farmers felt positive about the industry in February, this was the lowest recorded since the survey started 15 years ago.

Milk production is also set to drop again, back to 8.1-8.3 billion litres, levels not seen for 25 years.

Outlook altered by weather

Sentiment varied across the country, depending on seasonal conditions, and improved slightly when some farmers were surveyed again in April.

Tasmanian and West Australian dairy farmers are the most positive in the country, with 48 per cent of those surveyed positive compared to the national average of 34 per cent.

In Victoria, Australia’s largest milk production state, western Victorian dairy farmers were the most positive at 39 per cent.

But high costs, concerns about irrigation and feed drove down sentiment in the Goulburn Valley and Riverina, where only 29 per cent were positive.

Profit expectations tell a similar story.

Only 21 per cent of survey respondents in the Goulburn Valley and NSW Riverina expect to make a profit this financial year, compared to 60 per cent which returned a profit in 2017-18.

Up to 79 per cent of Tasmanian dairy farmers expect to make a profit this financial year, the same proportion which made a profit last financial year.

Western Victoria has the highest proportion of dairy farmers expecting a profit this season, at 60 per cent, only slightly down on the 68 per cent which made a profit last financial year.

Farmgate milk prices are the most significant driver of negative sentiment in Queensland and northern NSW, followed by the cost of production.

In South Australia, one-in-10 survey respondents plan to exit the industry, the highest recorded nationally.

Almost half of the NSW dairy industry is in a “‘temporary hold or contracting” business phase and 56 per cent don’t expect to change the number of cows they milk.

Thirty one per cent of these farmers recorded a decrease in production. 

Dairy Australia senior industry analyst John Droppert said the results of the national farmer survey were not surprising given the season many farmers hade been through.

He said “widespread dry conditions across Australia, high feed prices and high irrigation water prices” contributed to the poor sentiment.

“If you are in those markets, that drives confidence down, even in a fairly robust milk price environment,” he said.

“The milk price isn’t too bad, but the sort of increases seen in grain and hay, and especially the way hay prices increased so suddenly over the course of the second half of last season — and have stayed so high ever since — that took people by surprise

“It’s really squeezed margins ever since, that’s sort of outweighed what benefit we’ve seen in milk price terms.”

Farmers are not exiting

Unlike previous surveys, the negative sentiment hasn’t led to an increase in farmers quitting the industry.

Only six per cent of farmers said they intended to exit the industry and 11 per cent were “winding down”.

Of those quitting the industry, they were more skewed towards farms with herds of less than 300 cows, according to Dairy Australia.

“Correlations between actual exits and confidence is surprisingly low in historical terms,” Mr Droppert said.

“But what we do see, in these periods of low confidence and these real struggles, is people pull-back on investment.

“People go from expansionary phase to a holding pattern.

“Most farmers tend to be optimistic by nature, that’s why they are in such a volatile business.

“But they will pull back and wait to go again and, in many cases, take that view that there will be an opportunity things will come up gain.

“It is only when things get really bad, and for many farmers they have been really bad this season that we see that increase in exits.

“But the vast majority of people will tighten the belt will hold on and will hope to go again.”

Australian milk production is set to finish this season, at the end of June, producing 8.5 billion litres for the year, down 8 per cent on 2017-18.

Dairy Australia has forecast another 3-5 per cent drop for the coming season, bringing annual production to 8.1-8.3 billion litres, mostly a result of a reduction in cow numbers.

 

Source: ABC News

USDA Expects Limited Increase in Milk Production Due to Rising Feed Costs

Rising feed costs should temper milk production growth over the next two years says USDA’s Outlook Board chair.

“We do have lower cow numbers and weaker growth in milk per cow in 2019 and then lower milk per cow in 2020.”

Seth Meyer is projecting milk production to increase by 1.5 percent and the all milk price to be 90 cents higher next year which could bring some farmers closer to breakeven.

 

Dairy tech: Arla Foods’ new AI tool predicts how much milk 1.5m cows can produce

With the new Artifical Intelligence (AI) software, calculating milk production is reduced to “a few hours”

Arla Foods has developed a new artificial intelligence (AI) tool to better predict its milk intake from farms. According to the company, 200 million kilos of milk can now be utilized more efficiently each year, through predictions of how much milk 1.5 million cows will produce in the future, elevating value chain sustainability. Prior to the tool’s use, a forecast of this scale took days to create and was carried out through manual calculations of “piles of Excel sheets,” Arla notes. The new AI software speeds up the process, which is reduced to “a few hours,” and yields a “1.4 percent greater accuracy.” 

The new milk intake forecasting tool is implemented in all Arla’s markets across Europe, including Denmark, Germany, Sweden, the UK, Belgium, Luxembourg and the Netherlands.

“Arla’s in-house data scientists worked alongside our IT supplier to develop the AI system, using a 10-week sprint to present working pilot version and then 6 months to refine into a fully operational tool,” Torben Fabrin, Senior Vice President of IT at Arla, tells FoodIngredientsFirst. “In terms of shaping the future of the food and beverage industry, AI can have a key role to play. Ultimately, it’s about predictions. Whether this is forecasting where our raw ingredients need to be and when in order to reduce waste, or whether it’s helping us identify which new products and innovations will be successful based on previous learnings, these predictions can allow us to be more efficient. For us at Arla, this is part of our ongoing sustainability journey to develop a more environmentally friendly supply chain so we definitely see other opportunities for artificial intelligence around our business.”

“The better we are at predicting what our milk intake will be, the better we can plan and optimize our entire value chain, which both improves profitability for our farmer-owners and drives sustainability. The new AI tool provides us with an insight into our supply of milk that we have never had before,” says Michael Bøgh Linde Vinther, Director of Global Milk Planning at Arla.

Each year, Arla collects around 13 billion kilos of milk from some 10,300 farmer-owners across Northern Europe. The cooperative is now keeping a close eye on emerging technologies that raise the efficiency of dairy production. “More data drives better decision making,” the company emphasizes. 

Arla’s AI tool factors in variables such as seasonal changes, the number of farmers converting to new milk types, the farmers’ geographical characteristics as well as how much milk they produce on a daily basis.

“We are now able to make important strategic decisions on a more informed basis. The data has become more valid as it is now formalized in a bulletproof system rather than based on individual knowledge. It’s amazing to see how this new technology is able to optimize and improve an, up until now, very time-consuming task,” says Vinther.

As an example, the company says that it is now possible to make the distinction between how much milk should be collected from farmers in North Germany and West Germany three to five months ahead of time.

“This kind of knowledge is very valuable, as it allows us to be able to plan and adjust the number of Arla trucks traveling across the country. In that way, we can reduce our costs and save the environment from unnecessary CO2 emissions,” explains Vinther.

In March, Arla launched of an ambitious target to accelerate the transition to sustainable dairy production with an intensified focus on farming processes. The main target highlighted is a goal to reduce greenhouse gas emissions by 30 percent per kilo of milk over the next decade and to work towards carbon net zero by 2050.

According to a recent analysis from the UN’s Food and Agricultural Organisation (FAO), global milk production continues to become more efficient and sustainable with a global average of 2.5kg CO2 per kilo of milk. Arla farmers contribute to this result with an average emission intensity of 1.15kg CO2 per kilo of milk, about half of the global average, notes the company.

AI is shifting the food and beverage landscape
Industry looks to AI for its big data crunching capabilities. Increasingly, such digital technologies are offering valuable utility in improving traceability, trust and ultimately shape food supply chains to withstand the predicted challenges of the future. A rapidly growing urban population and increased consumer awareness regarding eco-friendly sourcing are prompting food companies and manufacturers to employ digital solutions to ensure product safety, quality and sustainability.

In April, food waste initiative Winnow launched an AI innovation coined Winnow Vision, which promises to revolutionize food waste management in commercial kitchens to benefit businesses and the environment. Winnow Vision utilizes a camera, a set of smart scales and machine learning technology to recognize the different foods that are discarded and calculate the financial and environmental cost. This may allow foodservice businesses to adjust their food purchasing decisions and reduce spending while tackling food waste.

In the same month, the world’s first AI-developed whiskey was launched by Swedish distillery Mackmyra, in collaboration with Fourkind, a Finnish technology consultancy specializing in AI spearhead projects, and Microsoft. The companies headline this breakthrough as the first time a complex consumer product recipe has been created with machine learning, which may further benefit food and beverage producers in a broader range of applications. Through a dataset analysis, the AI can generate more than 70 million recipes that it predicts will be most popular and of the highest quality.

A 2018 CSB-System survey found that decision makers within the food and beverage sector believe that digitization will have a “huge role to play” in the future of the industry. This is despite several challenges, including the lack of employee skills and low awareness of what technological solutions are available on the market. Even with large strides being made in this forward-looking space, investment in IT also remains “significantly low,” the survey finds. As such, it may be a while before most novel technologies are seen as ubiquitous across the industry.

 

Source: Food Ingredients 1st

Brazilian dairy sector needs more equipment

Ms Tereza Cristina, the Brazilian minister for agriculture wants better technical assistance for farmers, less taxes for imported equipment and a special insurance policy for the dairy sector.

The Brazilian government seems to move forward in supporting the Brazilian dairy farmers. New standards for production have come into force in May and the minister of agriculture wants to develop a plan to promote dairy sector modernisation. Ms Cristina has been appointed as the new agricultural minister in January of this year. In her role as new minister of agriculture and livestock and supply, former Congresswoman Tereza Cristina will focus on conquering new markets, boosting efficiency, increasing production and rising food security while ensuring that Brazilians players are producing increasingly more sustainable.

Low milk efficiency

Currently, Brazil has 900,000 dairy farmers. The country has around 20 million cows that together produce around 36 billion litres per year. But the efficiency of production is low. While the US achieves over 10,000 of litres per cow annually, Brazil only gets 2,000. “This is why the government has developed a plan,” says Ms Cristina. The plan aims for better technical assistance for farmers, less taxes for imported equipment, better export possibilities and a special insurance policy for the dairy sector.

Focus on milking equipment

And investments in equipment is needed, considering that only 48% of the Brazilian farmers use mechanical milking. Most of these farmers don’t have the financial capacity to invest in innovative equipment nor have they been trained to operate these systems, according to data from Sebrae (the Brazilian Supporting System for Small and Micro Companies). Due to this, just 22% of the farms is able to produce more than 13 litre per cow per day. At the same time, a lot of small farmers with low production levels of their herd quit their farm. The Brazilian government therefore wants to cut taxes on the import of all kinds of equipment for dairy production, such as milking robots. The agricultural minister also wants to create a task force to transform Brazil into a big exporter for dairy. “Maybe we can cooperate with Argentina and Uruguay to create a block. By combining our forces we can are able to compete with the milk volumes from EU, New Zealand and US.”

 

Source: Dairy Global

 

Diverse Virtual Farm Tours Come to World Dairy Expo

World Dairy Expo Virtual Farm Tours have brought the best dairy operations in North America to Madison for more than 15 years. The eight dairies to be featured during WDE 2019 excel in a variety of farm aspects including genetics, technology, community engagement, environmental stewardship, cow comfort and multi-generations, while also representing a wide variety of sizes, locations and breeds. Virtual Farm Tours are presented daily during World Dairy Expo in Mendota Room 1 of the Exhibition Hall, and are led by the farm’s owner or manager with time for questions and an open discussion to follow.

Sponsors of the 2019 Virtual Farm Tours include: Allflex Livestock Intelligence, American Jersey Cattle Association, GEA, Kansas Department of Agriculture, Lely, Select Sires, Inc., Semex and Quality Liquid Feeds, Inc.

Below is the 2019 World Dairy Expo Virutal Farm Tour schedule.

Tuesday, October 1 at 2 p.m.

Hosted by: Kieler Farms Inc, Platteville, Wis.

Highlights: 1,800 milking/Multi-Generation

Sponsored by: GEA

Wednesday, October 2 at 12 p.m.

Hosted by: Moo-Riah Dairy, Melba, Idaho

Highlights: 1,250 milking/Community Engagement

Sponsored by: Quality Liquid Feeds, Inc.

Wednesday, October 2 at 2 p.m.

Hosted by: Aurora Ridge Dairy, Aurora, N.Y.

Highlights: 2,075 milking/Genetics

Sponsored by: Semex

Thursday, October 3 at 12 p.m.

Hosted by: Albright Jerseys LLC, Willard, Ohio

Highlights: 650 milking/Technology

Sponsored by: American Jersey Cattle Association

Thursday, October 3 at 2 p.m.

Hosted by: Richland Dairy, LLC, Kenyon, Minn.

Highlights: 115 milking/Technology and Environmental Stewardship

Sponsored by: Lely

Friday, October 4 at 12 p.m.

Hosted by: Ratliff Jerseys, Garnett, Kan.

Highlights: 55 milking/Genetics

Sponsored by: Kansas Department of Agriculture

Friday, October 4 at 2 p.m.

Hosted by: Paulus Dairy LLC, Fredonia, Wis.

Highlights: 1,550 milking/Environmental Stewardship

Sponsored by: Select Sires, Inc.

Saturday, October 5 at 12 p.m.

Hosted by: Fischer Clark Dairy, Hatley, Wis.

Highlights: 911 milking/Cow Comfort

Sponsored by: Allflex Livestock Intelligence

 

Serving as the meeting place of the global dairy industry, World Dairy Expo brings together the latest in dairy innovation and the best cattle in North America. Crowds of more than 65,000 people, from nearly 100 countries, will return to Madison, Wis. for the 53rd annual event, October 1-5, 2019, when the world’s largest dairy-focused trade show, dairy and forage seminars, a world-class dairy cattle show and more will be on display. 

 

Secretary Perdue Announces New Dairy Margin Coverage Signup Begins June 17

U.S. Secretary of Agriculture Sonny Perdue today announces that signup begins June 17 for the new Dairy Margin Coverage (DMC) program, the cornerstone program of the dairy safety net that helps dairy producers manage the volatility of milk and feed prices, operated by the U.S. Department of Agriculture’s Farm Service Agency (FSA).

The 2018 Farm Bill allowed USDA to construct the new DMC, which replaces the Margin Protection Program for Dairy (MPP-Dairy). This new program offers protection to dairy producers when the difference between the all-milk price and the average feed cost (the margin) falls below a certain dollar amount selected by the producer.

“In February I committed to opening signup of the new Dairy Margin Coverage program by June 17, I am proud to say that our FSA staff worked hard to meet that challenge as one of the Department’s top Farm Bill implementation priorities since President Trump signed it last December.” said Secretary Perdue. “With an environment of low milk prices, high economic stress, and a new safety net program with higher coverage levels and lower premiums, it is the right time for dairy producers to seriously consider enrolling when signup opens. For many smaller dairies, the choice is probably a no-brainer as the retroactive coverage through January has already assured them that the 2019 payments will exceed the required premiums.”

The program provides coverage retroactive to January 1, 2019, with applicable payments following soon after enrollment. At the time of signup, dairy producers can choose between the $4.00 to $9.50 coverage levels.

Coverage Level

(margin)

Tier 1

Premium per cwt

(for the covered production history that is 5 million pounds or less)

Tier 2

Premium per cwt

(for the part of covered production history over 5 million pounds)

$4.00

None

none

$4.50

$0.0025

$0.0025

$5.00

0.005

0.005

$5.50

0.030

0.100

$6.00

0.050

0.310

$6.50

0.070

0.650

$7.00

0.080

1.107

$7.50

0.090

1.413

$8.00

0.100

1.813

$8.50

0.105

N/A

$9.00

0.110

N/A

$9.50

0.150

N/A

The Farm Bill also allows producers who participated in MPP-Dairy from 2014-2017 to receive a repayment or credit for part of the premiums paid into the program. FSA has been providing premium reimbursements to producers since last month and those that elect the 75 percent credit option will now have that credit applied toward 2019 DMC premiums.

The Department has built in a 50 percent blend of premium and supreme alfalfa hay prices with the alfalfa hay price used under the prior dairy program to provide a total feed cost that more closely aligns with hay rations used by many producers. At a milk margin minus feed cost of $9.50 or less, payments are possible. With the 50 percent hay blend, FSA’s revised April 2019 income over feed cost margin is $8.82 per hundredweight (cwt). The revised margins for January, February and March are, respectively, $7.71, $7.91 and $8.66 – triggering DMC payments for each month.

DMC payments will be reduced by 6.2 percent in 2019 because of a sequester order required by Congress and issued in accordance with the Balanced Budget and Emergency Deficit Control Act of 1985.

DMC offers catastrophic coverage at no cost to the producer, other than an annual $100 administrative fee. Producers can opt for greater coverage levels for a premium in addition to the administrative fee. Operations owned by limited resource, beginning, socially disadvantaged or veteran farmers and ranchers may be eligible for a waiver on administrative fees. Producers have the choice to lock in coverage levels until 2023 and receive a 25-percent discount on their DMC premiums.

To assist producers in making coverage elections, USDA partnered with the University of Wisconsin to develop a DMC decision support tool, which can be used to evaluate various scenarios using different coverage levels through DMC.

More Information

All dairy operations in the United States are eligible for the DMC program. An operation can be run either by a single producer or multiple producers who commercially produce and market cows’ milk.

Eligible dairy operations must have a production history determined by FSA. For most operations, production history is based on the highest milk production in 2011, 2012 and 2013. Newer dairy operations have other options for determining production history. Producers may contact their local FSA office to get their verified production history.

Dairy producers also are reminded that 2018 Farm Bill provisions allow for dairy operation to participate in both FSA’s DMC program and the Risk Management Agency’s Livestock Gross Margin (LGM-Dairy) program. There are also no restrictions from participating in DMC in conjunction with any other RMA insurance products.

On December 20, 2018, President Trump signed into law the 2018 Farm Bill, which provides support, certainty and stability to our nation’s farmers, ranchers and land stewards by enhancing farm support programs, improving crop insurance, maintaining disaster programs and promoting and supporting voluntary conservation. FSA is committed to implementing these changes as quickly and effectively as possible, and today’s updates are part of meeting that goal.

For more information, visit farmers.gov DMC webpage or contact your local USDA service center. To locate your local FSA office, visit farmers.gov/service-locator.

 

Source: USDA

CWT-assisted dairy product export sales total 4.4 million pounds

Cooperatives Working Together (CWT) member cooperatives accepted 18 offers of export assistance from CWT that helped them capture sales contracts for 802,483 pounds (364 metric tons) of Cheddar and Monterey Jack cheese, 257,941 pounds (117 metric tons) of butter, 187,393 pounds (85 metric tons) of cream cheese and 3.119 million pounds (1,415 metric tons) of whole milk powder. The product is going to customers in Asia, the Middle East, Central and South America. The product will be delivered during the period from June through November 2019.

These contracts bring the year-to-date dairy product totals to 28.867 million pounds of American-type and Swiss cheeses, 4.213 million pounds of butter (82% milkfat), 2.760 million pounds of cream cheese and 33.352 million pounds of whole milk powder. The products are going to 26 countries in six regions and are the milk equivalent of 626.3 million pounds of milk on a milkfat basis.

Assisting CWT members through the Export Assistance program positively affects all U.S. dairy farmers and all dairy cooperatives by strengthening and maintaining the value of dairy products that directly impact their milk price. It does this by helping member cooperatives gain and maintain world market share for U.S dairy products. As a result, the program has significantly expanded the total demand for U.S. dairy products and the demand for U.S. farm milk that produces those products.

The amounts of dairy products and related milk volumes reflect current contracts for delivery, not completed export volumes. CWT pays export assistance to the bidders only when export and delivery of the product is verified by required documentation.

All dairy farmers and all dairy cooperatives should invest in CWT. Membership information is available on the CWT website, www.cwt.coop.

 

Japanese Dairy farm numbers fall 60% in 20 years

The number of dairy farming households nationwide has dropped almost 60 percent in the last 20 years, according to Agriculture, Forestry and Fisheries Ministry data. The pace of the decline is equivalent to almost three households giving up dairy farming every day. Reasons for the decline include a harsh working environment that allows few days off and a lack of willing successors. Its effects are beginning to be seen, such as in rising retail prices for milk.

Production down 15%

According to the agriculture ministry, the 37,400 dairy farming households nationwide in 1998 had dropped to 15,700 households in 2018, equivalent to 1,085 households per year giving up the business.

Production of raw milk, which is used to make milk and butter, fell from about 8.57 million tons in 1998 to about 7.29 million tons in 2018, a 15 percent decline.

  • The Yomiuri Shimbun

With most dairy farming households being family-run businesses, labor shortages and the difficulty of securing successors are major factors behind the decline.

“With just me and my wife, this farm might be done,” said a sad-looking dairy farmer in Ogano, Saitama Prefecture, standing alongside his wife. The couple are both 55.

The man inherited the farm from his father about 30 years ago and ever since has raised 70 dairy cows and 50 head of beef cattle with his mother and wife.

He employs two part-time workers to help with milking, which must be performed daily in the morning and the evening. He barely has a day off and his 23-year-old eldest son, a university student, does not intend to take over the farm.

“Someday, I might have to hand over the cow barn, dairy cows and equipment to a third party,” the man said worriedly.

18 days off yearly

A survey by the Tokyo-based Japan Dairy Council found that the average dairy farming household in Hokkaido had 77.7 milkable cows, compared to only 43.4 cows in the other 46 prefectures, indicating many operations in the latter are small-scale. The average age of non-Hokkaido dairy farmers is older, with about 80 percent being at least 50 years old.

Nationwide, dairy farmers get an average of 17.7 days off per year, or only one or two days per month. They also work long hours. Farmers who have no successors will think twice about investing in equipment. Common reasons for stopping farming include aging and disease.

In addition, the Trans-Pacific Partnership free trade pact that went into effect last year is expected to increase dairy imports.

According to Yoshiharu Shimizuike, a lecturer on agricultural economics at Hokkaido University, production in Hokkaido supports consumption in the other prefectures. In fiscal 2017, Hokkaido delivered 400,000 tons of raw milk and 390,000 tons of milk in cartons to the rest of the nation.

“Transport capacity is limited due to a lack of drivers,” Shimizuike said. “Policies to prevent the number of dairy farmers from declining in prefectures outside Hokkaido are needed.”

¥7 more per carton

A decline in dairy farming households will also affect the stable supply of raw milk.

According to the agriculture ministry, since April the price of a regular-size carton of milk in supermarkets and other retail outlets has risen by about ¥7.

In addition, the priority when processing raw milk is to make milk for drinking, creating a shortage of raw milk for making cheese, butter and other dairy products. Imports are making up for that shortage.

Due to factors such as the growing popularity of cheese, domestic consumption of dairy products is growing. There has also been growth in imports of dairy products, going from 4.05 million tons in fiscal 2013 to 5 million tons in fiscal 2017, about a 20 percent rise.

“If things continue as they are, it will be difficult to maintain a stable supply of dairy products through domestic production,” said a Japan Dairy Council official.Speech

Source: the-japan-news.com

Wisconsin dairy farmer facing unstable market sells herd

Ryan Dunnum had tears in his eyes as he looked over the empty milking parlor that he built. It hadn’t been used since the end of April, when he decided enough was enough and sold most of his herd.

The weight of dairy market volatility started to feel overwhelming in January, he said, after frigid temperatures caused the parlor pipes to freeze and his herd blew through feed to keep warm and produce milk.

“I always had high optimism,” he said. “It was a drain… we’re here where we’re at now, going ‘Can you do it? Can’t you do it? Do you want to do it?’ then the question comes, ‘What are you going to do?’”

His farm is one of hundreds in Wisconsin that have shuttered this year. The rate of dairy closures has increased from two per day in Wisconsin in 2018 to three per day in 2019 so far. But he hopes to jump back into the business if the market price for milk rises and the cost of feed lowers, the La Crosse Tribune reported.

Dunnum, who bought his first cow at age 5 with the money he earned from helping his father harvest tobacco, grew the herd to 105 during the course of 38 years. Both sides of his family farmed for generations but now he thinks he was “the last Dunnum in the world to milk cows.”

His 120-acre farm, aptly named Top of the Town, sits on a hill in Westby where he said he can see 4th of July fireworks from surrounding cities on all sides.

Dunnum bought the business from his mother in 2006 after his father passed away. She remembers milking cows by hand before she went to school each morning. In 2015, Dunnum brought his mother up to the new milking parlor to show her how technology changed the industry.

“It wasn’t her style,” he said with a chuckle.

He hoped to pass the family business to one of his six children, two boys and four girls whose ages range from 3 years-old to 18 years-old. He and his wife lost their seventh child at nine days old, to E. coli sepsis in the lungs, in 2012.

Today, Dunnum’s herd is down to 14 after he sold most of his cows to slaughter to pay bills and keep a cash flow going, after he realized it was costing too much to buy feed.

With the help of his neighbors and two of his children who stayed home from school, his herd was loaded onto trucks one day and taken to Equity Cooperative in Sparta. The cows that remain on Dunnum’s farm are young stock that he hopes to use to get the business going again, if he decides to try to go back into the dairy industry.

“Right now, I’m just kind of like a displaced farmer,” he said.

Dunnum, who got up every morning for decades to take care of his herd, now finds himself without direction, without that routine. “It’s almost like trying to take a wild animal and caging it,” he said.

Before he quit, he sold his milk to Westby Cooperative Creamery, a 115-year-old organization owned by more than 200 farmers that produces cultured products and cheeses, where he sits as a board member with two years left on his term.

The board gave him time to rebuild his herd, if that’s the route he takes.

“I told them, ‘the cows gotta go, but I really would like to stay on the board,’ so they said they’d hold my seat until the 31st of July to see if I can get cows back,” Dunnum said.

He and his wife considered diversifying their agriculture products to provide a boost to their income amid the crisis and bought an established Christmas tree farm last year as well as an Angus cow for Dunnum’s son before realizing the beef market wasn’t much better than dairy. Top of the Town Farm produces oats, alfalfa and corn across three 40-acre plots.

“Back in the day, most farms were paid for with one crop,” he said.

There were nine dairy producers within a few miles’ radius of Dunnum’s farm before the market downturn. Now he counts two that remain. He knows dairy producers are consolidating and growing larger to survive, but bucks the idea of needing to “get big or get out”.

“You start adding more cows, now you need more help but now you have expensive help, now you need more cows to pay the help but now all of a sudden you need more land, you need bigger equipment, and all of a sudden your margins start shrinking, and you start losing control,” he said. “It isn’t a family farm anymore.”

He built the milking parlor and an adjunct barn for his milking herd that can hold up to 80 cows at one time a few years ago, but the barn never met capacity.

“I never hit that mark because of timing and pricing,” he said.

The stress of the volatile market, 18-hour work days between the tree and dairy farms, and the inability make ends meet took its toll on his family. Communication and trust between Dunnum and his wife broke down when she found out he wasn’t able to pay some of the bills.

“I feel like I let her down,” he said, his voice breaking. “Everything’s imploding and what do you do?”

He said it would take about $25,000 to get his dairy business rolling again, but banks are hesitant to provide a loan with only his equity as collateral, without evidence of a cash flow.

Dunnum has some feed left in his silo that he’s saving to jump start his small herd if the market improves. His pasture is overgrown with the grass his cows used to eat. A self-proclaimed optimist, Dunnum believes there’s something better.

“I talked to my 15-year-old son the night I sold the cows,” he said with a sigh, his voice echoed in the empty milking parlor. “He was upset. I said ‘you know what? Maybe this is the end of the curse.’ Years, generations. The amount of work I put in to this.”

 

Source: AP News

NZ dairy industry to invest $25.7m to improve national herd

New Zealand’s dairy industry is investing $25.7 million in an innovation project to produce better cows.

The seven-year programme, called Resilient Dairy: Innovative Breeding for a Sustainable Future, was launched at Fieldays. It will invest in new disease management technologies and advances in genomic science to improve cow productivity and produce animals with improved health, well-being and environmental resilience.

It is being led by Livestock Improvement Corp, with investment and support from the Ministry for Primary Industries and DairyNZ. Over the life of the programme, LIC will invest $11.2 million, MPI is investing $10.3 million and DairyNZ is investing $4.2 million.

“For New Zealand to maintain its reputation as a world-leading producer of premium products, we need to further increase the value of our products in a way that improves sustainability,” said Steve Penno, MPI’s investment programmes director.

According to MPI’s latest Situation and Outlook for Primary Industries, dairy export revenue may reach $17.6 billion in the year to June, up 5.7 percent on the previous year.

LIC, the largest supplier of artificial breeding services to New Zealand’s dairy farms, will leverage its existing capabilities in genomic science and diagnostics to develop innovative breeding tools and tests that support more sustainable milk production.

Richard Spelman, LIC’s chief scientist, said the programme will “ensure that our consumers see that our animals are well cared for and have good animal health. That will really ensure that our milk and our milk products that we produce from New Zealand get the highest market value.”

Investment from DairyNZ will go into re-building its national evaluation system for dairy cattle to incorporate genomic information to facilitate faster rates of genetic gain.

“Resilient Dairy is our opportunity to get back in front of the world with genetic gain,” says Bruce Thorrold, DairyNZ’s strategic investment leader. “It’s about using world-leading bio-technology and statistical methods to drive the performance of the New Zealand herd forward.”

 

Source: Scoop

Milk production ending in 2 Michigan counties

The closure of two dairy farms in the Upper Peninsula will end commercial milk production in two counties.

The Johnson Dairy Farm in Baraga County stopped production last week, and the owners of Rolling Acres farm in Houghton County expect to sell all of their milking cows by the end of July, The Daily Mining Gazette of Houghton reported. According to U.S. Department of Agriculture data, 6.5% of the nation’s dairy farms closed in 2018.

Gary Palosaari took over Rolling Acres in Chassell Township from his parents in 1992. He said the farm kept losing money because of years of low milk prices and high costs.

“You think you can ride it out, but then the hauling costs got so extremely high,” he said. “We’re paying a ridiculous amount of hauling because there’s not enough milk. Then when money’s tight, you can’t pay labor like you should, so everything falls on each other.”

His wife, Teresa Palosaari, said it was costing the farm more than $4,000 a month to ship the milk to Jilbert’s Dairy in Marquette.

Of the 190 cows in the herd, 54 are being milked, generating 75 pounds of milk a day, Gary Palosaari said. The farm makes about $15 per 100 pounds of milk.

Palosaari said the farm lost money last year, and he has been subsidizing the business with money he’s earned doing construction work on the side.

He said that despite all this, he hasn’t given up on dairy farming altogether. Perhaps, he said, he’ll revisit having milk cows in a couple of years. Meanwhile, the family is considering keeping some of the remaining herd for beef, and it could continue to grow crops — although trucking costs will continue to be a factor.

Steve Johnson, the owner of the Johnson Dairy Farm, declined to provide details about why he decided to stop producing milk after 43 years. But he said it was hard to say goodbye to his herd.

“The day they went, it was an awful sad day,” Johnson said. “But that’s the way it is.”

Source: freep.com

Some dairy farmers use online fundraisers to try and keep operations going

Since January of 2019 almost 300 dairy farms have called it quits in Wisconsin according to Wisconsin Department of Agriculture and Consumer Protection data.

It’s a continuation of a trend over the last few years that have seen the number of dairies in the state dwindle by the thousands.

Some farmers are getting creative in their attempts to hold on. Including turning to online fundraising sites like GoFundMe.

“I didn’t know if it was going to help or if it was going to do anything or anything, but I guess I was at my wits end and I thought what have I got to lose?” said Mary Reickmann, a dairy farmer in Fremont, WI.

The farm has been in Reickmann’s husband’s family for four generations. The couple bought it in the 60’s from her husband’s dad and they expanded it to a dairy operation. They’ve always had between 40 and 50 cows.

“We worked hard at it and we got it to where it’s a nice place now and now things are hard again, and they’re very hard,” Reickmann said.

So far the GoFundMe has brought in more than $19,000 for the couple. Reickmann said they’ve used it to buy feed for the cows and fuel, though they’re still struggling to get by.

“We don’t expect to get rich on this or anything else, but just see a little bit of daylight,” Reickmann said.

A friend helped the Reickmann’s set up the GoFundMe. They first heard about it from another farmer who set one up.

It may be a growing trend. Family Farm Defenders, a Wisconsin organization that advocates for dairy farmers in the state, says they’ve seen more and more online fundraising campaigns like this one.

“Farmers need to use every tool available to survive today and don’t be ashamed to use GoFundMe,” said Joel Greeno, president of Family Farm Defenders.

Greeno recommends farmer use it if they think it’s appropriate, he says it can be a tool to keep the farm running.

“Do what you need to do to get by, there’s hope, you just need to fight for it,” Greeno said.

Reickmann recommends it too, she says she knows it can be tough to ask for help.

“I didn’t think it would ever come to this, but it did and it’s a terrible feeling when you don’t know which way to turn,” she said.

You can find the Reickmann’s GoFundMe here

Greeno says farmers struggling can also reach out to Family Farm Defenders at 608-260-0900 and they may be able to help them get resources.

 

Source: Spectrum News1

Dairy numbers tell troubling story in Winona County

“We’re denying economic progress here in Winona County.”

Marcia Ward said the animal unit cap in Winona County is hurting business, particularly the dairy business.

The prime example, said Ward, one of five Winona County commissioners, came earlier this year when the Winona County Board of Adjustments refused to grant a waiver to Daley Farms in its request to expand to nearly 6,000 animal units, well beyond the county’s 1,500 AU cap.

Winona County is losing its dairy industry faster than the Minnesota average, according to the 2017 Census of Agriculture county-level data released on May 30.

Counties across the state have seen not only a drop in the number of dairy farms, but a drop a specific sector of the dairy industry: farms with 199 or fewer cows. That trend has particularly hit Winona County.

Since 2007, Winona County has lost nearly half its dairy farms — 94 of 212 — with herd sizes 199 and fewer, but among that same group of farms, it lost 8,105 cows, or 55 percent of the animals on smaller dairies.

Meanwhile, the larger dairies in Winona County have stayed somewhat steady and even grown. The number of farms with herds from 200 to 499 dairy cows held steady at 32 from 2007 to 2017, and even saw an increase in the total number of cows, from 9,050 to 10,096, an 11 percent jump. And the largest dairies, those of 500 cows or more, increased from seven farms to 10 with the number of cows going from 5,590 to 7,312, an increase of 30.8 percent, according to the census reports.

Ward said more so than the number of dairies, the impact the industry has on the local economy is measured in the number of cows. And that’s where the animal unit cap is causing damage to the county’s economy, particularly in rural communities that rely on a healthy agriculture economy. Ward said the cap, which has been in place for more than 20 years, was designed to help keep small dairies viable by restricting the larger dairies from becoming too big. But that, she said, hasn’t happened.

“Obviously, by the numbers, we’re losing those smaller dairies,” she said. “So it’s not been effective, no. There are too many other factors that determine who is going to farm, how they’re going to farm.”

In fact, all the cap has done, she said, is stymie any potential growth because the nature of the dairy industry is geared toward larger farms that can take advantage of the economies of scale in an ag sector that lives on thin margins.

While Ward and fellow rural commissioner Steve Jacob have said they’d like to revisit the animal unit cap and explore whether it’s a law in the county that makes sense, not every member of the Board of Commissioners agrees.

Commissioner Christine Meyer said while her “heart goes out to farmers in general and dairy farmers specifically” due to everything from a weak ag economy to natural disasters that have impacted farms in recent months, she’s not convinced lifting the animal unit cap is the answer.

“I would want any action Winona County might take to help farmers to actually be helpful, and I’m not convinced that the animal unit cap is the place to start,” Meyer said.

At a county board meeting in March, Meyer said she proposed convening a committee to look at the issues facing farmers in Winona County, but that committee should take a broad look at all parts of the ag economy, not just dairy and the animal unit cap.

Meyer said she spoke with several small dairy farmers, and they told her as more large dairies enter the local economy, they squeeze out the smaller dairies.

“The additional argument they presented to me was that as the milk supply increases, which would likely happen with expansion of larger dairies, this would lower milk prices even more,” she said. “In addition, they said that milk processors might drop several small dairies when they picked up expansions of a single larger dairy.”

But Shelly DePestal, one of the owners of Daley Farm, said it’s that kind of thinking that has led Winona County to account for 81 percent of the dairy cows lost in the state of Minnesota since 2012.

And the problem is getting worse, not better. Since 2017, she said, she’s heard anecdotal evidence of at least 2,000 more cows being lost in the county.

“People don’t want to jump through all those hoops,” DePestal said, referring to the animal unit cap and the business climate for large dairies in Winona County. “They’re not even going up to the animal unit cap because of all the people who will throw stones at you when all you want to do is run a business.”

While the issue with Daley Farm might be decided one way or another after July 17 when the Daleys’ appeal of the Board of Adjustments decision in February will get its day at the Minnesota Court of Appeals, the rest of the county still lives under the animal unit cap.

Ward said that the dairy industry is made up of independent businesses, and the Daleys, who are at the heart of the fight in Winona County, are a family farm and independent business.

“It used to be you could live off the land,” Ward said. “But today, you have to have cash flow to pay your taxes. We don’t take chickens to pay your taxes.”

And the loss of dairy cows is a loss of tax revenue across the county, she said.

“That’s major dollars,” Ward said. “If we let some other industry just leave Winona County, there’d be a major uproar.”

Source: postbulletin.com

Dairy producer Yili has continued to be the most chosen brand in China’s

Dairy producer Yili has continued to be the most chosen brand in China’s mainland for the fourth consecutive year, according to Kantar Worldpanel.

Mengniu and Master Kong maintained in the second and third in the ranking, while Haday, the leading brand in the seasoning market, was fourth.

The consumer reach point index compiled by Kantar Worldpanel combines the number of buyers and the frequency of shopping for each brand in one year.

According to this year’s study which covers seven Asian markets including Indonesia, South Korea and Vietnam, consumer trends and focuses have shifted to health, safety, convenience and happiness.

Marcy Kou, CEO Worldpanel Division Asia of Kantar, explained: “Growth and success are not just about making a big impact in the market but how to build a sustainable brand that can evolve through generations and changing consumer needs.”

Coca-Cola, Oreo and Liushen are among the fastest rising brands. Coca-Cola is the fastest rising brand in terms of consumer reach thanks to smaller packages and new flavors targeting healthy demand.

“In China there is still significant potential for most brands to grow by expanding into emerging categories, lower tier cities and new shopper occasions. In the new retail era, both Chinese brands and global brands have opportunities to grow if they constantly innovate to meet the changing expectations of Chinese shoppers,” commented Jason Yu, managing director of Kantar Worldpanel China.

For the third year, Nongfu Spring, Taoli, Luhua, Haday secured places in the top 10.

Source: shine.cn

New Dairy Margin Coverage Signup Begins June 17

U.S. Secretary of Agriculture Sonny Perdue today announces that signup begins June 17 for the new Dairy Margin Coverage (DMC) program, the cornerstone program of the dairy safety net that helps dairy producers manage the volatility of milk and feed prices, operated by the U.S. Department of Agriculture’s Farm Service Agency (FSA).

The 2018 Farm Bill allowed USDA to construct the new DMC, which replaces the Margin Protection Program for Dairy (MPP-Dairy). This new program offers protection to dairy producers when the difference between the all-milk price and the average feed cost (the margin) falls below a certain dollar amount selected by the producer.

“In February I committed to opening signup of the new Dairy Margin Coverage program by June 17, I am proud to say that our FSA staff worked hard to meet that challenge as one of the Department’s top Farm Bill implementation priorities since President Trump signed it last December.” said Secretary Perdue. “With an environment of low milk prices, high economic stress, and a new safety net program with higher coverage levels and lower premiums, it is the right time for dairy producers to seriously consider enrolling when signup opens. For many smaller dairies, the choice is probably a no-brainer as the retroactive coverage through January has already assured them that the 2019 payments will exceed the required premiums.”

The program provides coverage retroactive to January 1, 2019, with applicable payments following soon after enrollment. At the time of signup, dairy producers can choose between the $4.00 to $9.50 coverage levels.

Coverage Level(margin) Tier 1Premium per cwt

(for the covered production history that is 5 million pounds or less)

Tier 2Premium per cwt

(for the part of covered production history over 5 million pounds)

$4.00 None none
$4.50 $0.0025 $0.0025
$5.00 0.005 0.005
$5.50 0.030 0.100
$6.00 0.050 0.310
$6.50 0.070 0.650
$7.00 0.080 1.107
$7.50 0.090 1.413
$8.00 0.100 1.813
$8.50 0.105 N/A
$9.00 0.110 N/A
$9.50 0.150 N/A

The Farm Bill also allows producers who participated in MPP-Dairy from 2014-2017 to receive a repayment or credit for part of the premiums paid into the program. FSA has been providing premium reimbursements to producers since last month and those that elect the 75 percent credit option will now have that credit applied toward 2019 DMC premiums.

The Department has built in a 50 percent blend of premium and supreme alfalfa hay prices with the alfalfa hay price used under the prior dairy program to provide a total feed cost that more closely aligns with hay rations used by many producers. At a milk margin minus feed cost of $9.50 or less, payments are possible. With the 50 percent hay blend, FSA’s revised April 2019 income over feed cost margin is $8.82 per hundredweight (cwt). The revised margins for January, February and March are, respectively, $7.71, $7.91 and $8.66 – triggering DMC payments for each month.

DMC payments will be reduced by 6.2 percent in 2019 because of a sequester order required by Congress and issued in accordance with the Balanced Budget and Emergency Deficit Control Act of 1985.

DMC offers catastrophic coverage at no cost to the producer, other than an annual $100 administrative fee. Producers can opt for greater coverage levels for a premium in addition to the administrative fee. Operations owned by limited resource, beginning, socially disadvantaged or veteran farmers and ranchers may be eligible for a waiver on administrative fees. Producers have the choice to lock in coverage levels until 2023 and receive a 25-percent discount on their DMC premiums.

To assist producers in making coverage elections, USDA partnered with the University of Wisconsin to develop a DMC decision support tool, which can be used to evaluate various scenarios using different coverage levels through DMC.

More Information

All dairy operations in the United States are eligible for the DMC program. An operation can be run either by a single producer or multiple producers who commercially produce and market cows’ milk.

Eligible dairy operations must have a production history determined by FSA. For most operations, production history is based on the highest milk production in 2011, 2012 and 2013. Newer dairy operations have other options for determining production history. Producers may contact their local FSA office to get their verified production history.

Dairy producers also are reminded that 2018 Farm Bill provisions allow for dairy operation to participate in both FSA’s DMC program and the Risk Management Agency’s Livestock Gross Margin (LGM-Dairy) program. There are also no restrictions from participating in DMC in conjunction with any other RMA insurance products.

On December 20, 2018, President Trump signed into law the 2018 Farm Bill, which provides support, certainty and stability to our nation’s farmers, ranchers and land stewards by enhancing farm support programs, improving crop insurance, maintaining disaster programs and promoting and supporting voluntary conservation. FSA is committed to implementing these changes as quickly and effectively as possible, and today’s updates are part of meeting that goal.

For more information, visit farmers.gov DMC webpage or contact your local USDA service center. To locate your local FSA office, visit farmers.gov/service-locator.

Jersey cow registrations in Canada are highest since 1963

This may be the year of the Jersey cow.

Last year more than 11,800 head were registered with Jersey Canada and growth for the breed is poised to continue. This is the highest number of Jerseys registered since 1963.

Membership in the Jersey association has been growing each year. In 2000, there were about 550 members and in 2018 there were 1,123 members.

“We have grown in the last five, six years. We have grown by 200, 230 per cent in our membership,” said Jersey Canada president Dave Morey, who owns the country’s largest purebred herd.

More herds are adding Jersey cows, said Kathryn Roxburgh, general manager of Jersey Canada.

“In 2001, 4.4 per cent of milk-recorded dairy herds in Canada included Jerseys. By the latter part of 2018, 14.3 per cent of milk-recorded herds had a Jersey presence,” she said at the association annual meeting held in Alberta this year.

Records show one in every seven dairy herds include Jerseys.

“The expansion of the Jersey breed in Canada seems to be a result of dairy producers including Jerseys into their already established herds,” she said.

Jersey Canada fieldman Jean-Marc Pellerin, who visits herds across the country, has also noticed a surge.

“People are more serious about their engagement to the Jersey breed. Instead of one or two or three cows, there are some that have made complete switches,” he said.

In addition, interest in genetics has increased. Embryo sales were 49 per cent higher in 2018 than 2017.

More are being genotyped, although adoption of genomics has been slower than the Holstein breed.

“People are starting to accept it is valid,” Morey said.

Source: farmtario.com

How Milk Is Priced in Federal Milk Marketing Orders

There’s an old adage in the dairy industry that “only five people in the world know how milk is priced in the U.S. – and four of them are dead.” Milk pricing regulations in Federal Milk Marketing Orders (FMMO) are among the most complicated commodity pricing regimes across all of agriculture.

Milk pricing regulations in place today stem from pricing reform in 2000 that introduced end-product pricing formulas, by which regulated milk handlers are required to pay producers based on their utilization of the milk. Producers in a marketing area (Figure 1) share in the proceeds of all milk sales “pooled” on an order, and the regulated minimum milk prices reflect the end-product pricing formulas and the farm’s share of the revenue sharing pool. For nearly 20 years there were only 10 milk marketing orders, but in September 2018 California was introduced into the FMMO system as a result of the 2014 farm bill (2014 Farm Bill: Key Factors to Consider with a California Federal Milk Marketing Order). Today, there are 11 FMMOs in the United States.

Expand Image

In FMMO milk pricing, we often talk about the three C’s: commodity, component and class. The different class prices are derived from various component values, which are in turn derived from several commodity prices.

There are several steps involved in determining farm-level milk prices for farmers pooling on a FMMO. First, each week, through mandatory price reporting, dairy manufacturers report to USDA the value and sales volume of wholesale butter, cheddar cheese, nonfat dry milk and dry whey.

Next, these prices are used to determine two-week and monthly weighted average commodity values. The two-week prices are used to determine advanced pricing factors for pricing fluid milk and cultured products. The monthly weighted average prices are used to determine both the component value and the classified value of milk. Both the two-week and monthly prices utilize end-product pricing formulas (described below) to determine the classified value. A flow chart of this end-product milk pricing system is depicted in Figure 2, and as an example of end-product pricing the cheese price is used to determine the protein value, which is then used to determine the classified value for milk used to produce cheese, which is then part of a revenue sharing pool to then determine the farm-level regulated minimum milk price.

Expand Image

Classified Pricing

A key part of the classified end-product pricing system is that the milk has a different value depending on how it is used. There are four classes of milk based on the end use of that milk:

Class I: fluid milk for drinking, including eggnog and buttermilk (Price Formula)
Class II: soft products like ice cream, yogurt and cottage cheese (Price Formula)
Class III: hard cheeses, cream cheese and whey (Price Formula)
Class IV: butter and dry products such as milk powder/NFDM (Price Formula)

Class I fluid milk typically receives the highest price under the FMMO system. The rationale for Class I milk prices being the highest value dates to an early economic argument that demand for fluid milk was inelastic, meaning a higher price wouldn’t significantly change demand for milk. As a result, fluid milk carried a higher price differential that was used to assist in facilitating the balancing of fluid milk supply and demand as well as transportation costs. However, in recent years fluid milk consumption has declined suggesting a review of the demand elasticity is warranted, e.g., Trends in Beverage Milk Consumption.

Until recently, Class I prices were calculated by using the higher of Class III and IV advanced pricing factors. As of May 1, 2019, the Class I skim milk price formula is the average of the monthly Class III and IV advanced skim pricing factors plus 74 cents per hundredweight and including the applicable adjusted Class I differential, Proposed Changes to Fluid Milk Pricing.

Class I prices share a common base value but will vary by location. This is due to the Class I differential, which varies across the country due to specific supply and demand fundamentals of beverage milk in each region. Class I price differentials range from a low of $1.60 per hundredweight in the Upper Midwest to $6 per hundredweight in Florida, Figure 3. The manufacturing value of milk in all other classes is the same across the U.S.

Expand Image

These classified milk values are ultimately used in revenue sharing pools to determine the regulated minimum price that is due to dairy farmers pooling on an order. There are two types of milk pooling schemes: multiple component pricing and skim-fat pricing.

Determining Component Values

The primary idea behind multiple component pricing is to arrive at a milk price that is derived from the end products made from the milk. On the face of it, the basic formula for component pricing is very simple:

Component Value = Yield x (Commodity Price – Make Allowance)

The yield is how much of the commodity can be made from the milk, the commodity price is the value of the end product – based on the USDA surveys — and the make allowance is the manufacturing cost of processing the milk into the end commodity. These component values are then used to determine the minimum prices for the orders through the classified pricing system. Federal orders specify four different components: butterfat, which derives its value from the price of butter; nonfat solids, which derive their value from the nonfat dry milk price; protein, which derives its value from cheese and butter prices; and other solids, which derive their value from the dry whey price. In the component value formula, the yield and make allowances are fixed and can only be changed through a rulemaking proceeding, while the commodity prices change monthly.

Make allowances are processing credits designed to reflect the average processing costs associated with producing cheeses, butter, nonfat dry milk (NFDM) or dry whey. Yield factors represent the volume of the finished commodity produced from processing one pound of the component. Table 1 highlights the make allowances and yield factors used in the end-product pricing formulas.

Expand Image

The commodity prices used in the component value formulas are based on wholesale commodity prices collected weekly by USDA’s Agricultural Marketing Service. Each week, large manufacturers are required to report data on sales transactions for cheddar cheese (40-pound blocks and 500-pound barrels), dry whey, nonfat dry milk and butter to be aggregated and published in the National Dairy Products Sales Report.

Another characteristic of the classified pricing system is timing. AMS announces the advanced Class I price and the advanced Class II skim price, as well as the necessary information to calculate them, on or before the 23rd of the preceding month. For example, the January 2020 Class I beverage milk price will be announced in December 2019.

AMS announces the commodity prices, and therefore the Class II fat and Class III and IV prices on or before the 5th of the following month. You can’t value protein and butterfat for a certain month until you know what the cheese and butter prices were in that month.

These component and classified values are used in the final step of milk pricing: revenue sharing pools. There are two types of revenue sharing pools: skim-fat pricing and multiple component pricing. In both cases the handler value of milk is determined by summing the value of all milk pooled on the order by class of utilization and the producer value is determined based on the pooling method.

Expand Image

Skim-Fat Pricing Pool

In four of the FMMOs, Appalachian, Arizona, Florida and Southeast, the milk pricing regulations are based on butterfat and skim pricing and do not incorporate proteins. In this pricing framework the handler’s value of milk is based on the classified skim and fat value of milk, whereby the Class I and II skim and fat values are higher value due to the differentials.

The producer value of milk in a skim-fat pool is then the weighted average value of butterfat and skim. These prices are referred to as the uniform fat and skim values. An example of a pool calculation is available here. Under skim-fat pricing, prices are set based on the fat content in the milk. The uniform butterfat and skim prices are announced after the monthly pooling process.

Since the formula bases the price on the fat content of the milk, it categorizes everything else as skim; as a result, the water contained in the skim portion receives the same price per pound as non-fat solids. Producers with a higher milkfat content will have a higher minimum regulated milk price – holding the location adjustment constant.

Component Pricing Pool

While the skim-fat pools determine the handler value of milk based on the classified values of skim and fat, in a component pricing order the handler’s value of milk is based on their utilization of butterfat, protein, non-fat solids and other solids, but also include the Class I and II differentials.

The producer value of the milk is then based on the components in the pool – and are based on the announced component prices for fat, protein and other solids. The equity payment from the pool is called the producer price differential and is defined as the difference between the handler value and the component value, divided by total pounds in the pool. An example of a pool calculation including the PPD can be found here. Producers pooling on a component pricing order will have a higher regulated minimum price based on the solids content of their milk.

Summary

The price of milk in the U.S. is one of the more complicated agricultural policy issues in the U.S. How milk is utilized affects the ultimate farm-level regulated milk price, which is a market-weighted average based on the end usage of the milk in the various classes in the order plus an equity payment from a revenue sharing pool. The more Class I, or beverage milk, in a pool, the higher the regulated minimum price. This means, an order in which a larger percentage of milk is used for fluid milk consumption will be more heavily weighted toward Class I prices than orders that use a larger share of milk in manufacturing classes.

Another key tenet of FMMOs is the concept of revenue sharing pools. Effectively, all similarly situated handlers and producers have a similar regulated milk price – absent differences due to quality or component levels. Processors each pay a different price for the milk, depending on what end product they are producing, while farmers receive an average price (the blended price) from how the pooled milk was used in the order.

In practice, the milk check that farmers receive will differ based on the actual components of their milk, even though they receive the same component prices. Processors then pay into or take money from the order’s pool depending on whether the price they paid was below or above the producer value of milk. Producers are paid the blend price including an equity payment from the pool, adjusted for location.

Non-cooperative-owned regulated milk processing plants are required to pay regulated minimum prices to farmers, unless prices are agreed upon in a forward pricing agreement. Re-blending provisions provided to cooperatives under the Agricultural Marketing Agreement Act allow cooperative-owned plants and cooperatives to pay prices below the regulated minimum to their members.

Source: fb.org

Lab-grown dairy: The next food frontier

Lab-grown meat is getting a lot of attention along with plant-based meat substitutes. Technology is driving the industry toward providing alternatives to conventionally produced food products. Dairy proteins may be the next product produced in a lab, for use in fluid “milk” production and processed dairy products like yogurt and cheese, to name a few.

Winston Churchill predicted the rise of synthetic foods in 1931.

“We shall escape the absurdity of growing a whole chicken in order to eat the breast or wing, by growing these parts separately under a suitable medium. Synthetic food will, of course, also be used in the future.”

While it took longer than 50 years, his prediction is coming true with meat proteins and now dairy proteins.

What is synthetic dairy?

Perfect Day Inc., a California-based start-up, has recreated the proteins found in conventional cow’s milk without the use of animals. The company developed a form of genetically modified microflora that produces both whey and casein through a fermentation process.

The approach can be loosely compared to the use of brewer’s yeast to produce alcohol. Yeast is used in controlled environments to create fermentation byproducts and the two processes simply employ different yeasts for a different purpose and output.

Perfect Day says their product is the exact same as the protein found in cow’s milk. Conventional milk is approximately 3.3 per cent protein, of which 82 per is casein and 18 per cent is whey. The other main elements are water, fat and carbohydrates.

Perfect Day has the technology to remake the small fraction of milk that is protein, arguably the most important component to produce other foods. The company suggests that its dairy protein is vegan and lactose-free, while providing the same high-quality nutrition as conventional dairy protein. This could have significant appeal for consumers.

Tough to mimic full-fat milks

Milk produced by dairy cattle is a versatile ingredient used in various products worldwide. More than 70 per cent of milk sold from Canadian farms in 2019 is used for further processing, leaving the remainder to be consumed as fluid milk.

It may be difficult to produce full-fat milks that mimic the taste and texture of cow’s milk. Protein is just one component of fluid milk; milk fat is another, which would likely be the most difficult to mimic with plant-based alternatives. The structure of milk fat provides a specific taste and mouth feel when drinking milk, and this may be a tougher formulation challenge than creating proteins to be used in cheese or yogurt.

The early focus of Perfect Day’s communication was on fluid milk — the kind we drink —but the company has shifted its focus to processed products.

Perfect Day has partnered with food production powerhouse Archer Daniels Midland (ADM), among others, to move towards full-scale production. The company is one of the world’s largest agricultural processors and food ingredient providers with more than 330 manufacturing facilities in almost 200 countries. ADM supplies a vast list of ingredients for both human and animal consumption; synthetic dairy protein may be a perfect addition to their offerings.

Products such as yogurt and cheese are different than fluid milk, and may be more suitable for using lab-grown casein and whey. The synthetic proteins could be used to replace dairy milk ingredients or to complement them.

In yogurt production, for example, protein is often added to improve texture. There are differing proportions of milk components in various processed products. This means that fermented casein and whey proteins could augment or replace conventional protein ingredients. This is easier to do in products with high-protein ingredients.

That said, the potential use of animal-free dairy protein goes far beyond traditional dairy products such as cheese and yogurt. Hot dogs that contain milk powder and granola bars that contain modified milk ingredients are examples of the many foods that could use this alternative dairy protein.

Tackling malnutrition?

Perfect Day CEO Ryan Pandya said last year: “We began to look into how we can use our protein to prevent stunted growth and malnutrition in the developing world.” This suggests Perfect Day’s focus is on providing ingredients rather than producing milk.

We’ve long had an alternative to butter – margarine. But a lot of consumers prefer butter.Shutterstock

Some products aren’t well-suited to this approach. Butter, for example, is made from milk fat and has almost no protein. We’ve long had a plant-based alternative to butter — margarine. But many consumers moved away from margarine and back to butter.

The Canadian per capita consumption of butter increased from 2.72 kilograms to 3.21 kilograms from 2007 to 2016. This increase in butter demand has led to an excess of milk protein in the marketplace in both Canada and the United States.

While it remains to be seen if these fermented proteins can be produced economically, their introduction into the marketplace could cause significant disruption to the dairy industry. The disruption would be due in part to switching some processed products away from conventional dairy proteins.

There would be additional disruption because of the change in relative demand for protein and other milk components. We would likely end up with more significant surpluses of proteins from both conventional dairy and synthetic production.

The future

Many issues need to be resolved before these products arrive in our supermarkets. The economics of production have to work. Products need to be reformulated to incorporate the fermented proteins with other ingredients to replace the milk components.

The Canadian Food Inspection Agency currently describes milk as being produced by an animal. The U.S. Food and Drug Administration has not yet made a policy statement on classifying synthetic milk proteins.

Milk in Canada is also subject to a supply management system that includes quota for production.

Will synthetic casein and whey be subject to the same system? The regulatory environment will require significant clarification, and any changes will be vigorously debated by various interests.

Some consumers will highly value the fact that animals are not required to produce these proteins, creating a vegan, lactose-free product. There will also be a perception that synthetic dairy proteins will have a smaller environmental footprint.

Other consumers will likely have concerns that the proteins are produced using a genetically modified yeast.

Despite these uncertainties, we will likely see synthetic dairy products on grocery shelves within a few years.

Source: theconversation.com

‘Hardest Thing I’ve Been Through’: Dairy Farm Rebuilding After Losing Cows Last Winter

Southeastern Minnesota was the perfect place to build a dairy farm that would pass down through the generations, but three months ago, it was a different story on the Hoffman Farm.

You might remember when snow piled up thanks to a March storm. It caused barn roofs to collapse at farms across the state.

Hoffman Farms near Chatfield was hit as hard, losing a barn and 13 cows to the weight of snow.

“I don’t know if this is God telling us to find a new career or what,” said Corey Hoffman March 6.

Since 2000, more than 60,000 family run dairy farms have closed across the state — and nobody would have blamed the Hoffman Family if they would have followed suit.

“I am 36-years-old and it’s the hardest thing I’ve been through,” Hoffman said.

Snow kept piling on, leading to a series of roof collapses that killed more than a dozen of Hoffman’s dairy cows, and forced him to sell the rest.

“When we sold the cows it was like, ‘Are we making the right decision?’ Their welfare was our top priority. Obviously with the third and fourth collapse, we made the right decision,” Hoffman said.

But the decision to keep the 116-year-old dairy farm in operation was up in the air. For months, the Hoffman’s weren’t sure what they would do until their insurance company finally told them they could replace everything that was lost.

They are now hoping to start rebuilding in July, and with a little luck, they’ll be finished by November. The plan is to have about 750 dairy cows when all is said and done.

The memories of that brutal week are everywhere on the farm, but the sun now shines on the future. Despite what they’ve been through, the Hoffman’s consider themselves lucky.

“I’ve never experienced anything like that. We’ve got our health. Nobody died. That’s the number one thing,” Hoffman said.

The Hoffman’s say a silver lining is that their new barn will have better, state of the art ventilation for their dairy cows.

Source: minnesota.cbslocal.com

Dairy Farmers, Industry to Congress: Help Us by Passing USMCA

The U.S. dairy industry is urging Congress to quickly ratify the U.S.-Mexico- Canada Agreement (USMCA) with an outreach campaign highlighting the importance of the agreement to the success of America’s dairy farmers and manufacturers.

In a letter sent to representatives of top-producing dairy states, the U.S. Dairy Export Council (USDEC), the National Milk Producers Federation (NMPF), and the International Dairy Foods Association (IDFA) detail how provisions of USMCA positively impact the U.S. dairy industry. The timely resolution of ongoing trade disputes and negotiations is critical to growing the dairy sector’s international market share as well as maintaining credibility with U.S. trading partners. Therefore, the dairy community is asking Congress for immediate passage of this important trade agreement.

The organizations write:
“On behalf of the dairy farms and businesses in your district, please pursue a USMCA vote without delay by working to resolve any outstanding issues as swiftly as possible and then quickly ratify the trade deal to send a clear message to the world that America still values fair trade and robust trade partnerships with our allies.”

“Solidifying and expanding trade opportunities abroad through USMCA will improve the prospects of dairy farms here at home,” said Jim Mulhern, president and CEO of NMPF. “In the midst of uncertainty surrounding our trade relationships and yet another year of meager milk prices, the United States lost an average of seven dairy farms a day in 2018. The passage of USMCA will instill a renewed sense of optimism in our dairy farmers.”

With approximately 16 percent of the U.S. milk supply exported annually, strengthening trading relationships and expanding international market opportunities is vital to the financial well- being of the U.S. dairy industry. USMCA preserves U.S. dairy sales to Mexico, the U.S. dairy industry’s largest foreign customer, while increasing market access in Canada and tackling nontariff barriers that can hinder exports.

“It is time for Congress to swiftly pursue a USMCA vote by working closely with the Administration to resolve outstanding concerns and then quickly ratify this agreement to bring USMCA across the finish line,” said Tom Vilsack, president and CEO of USDEC. “The successful resolution of the Section 232 retaliatory tariffs helped pave the way for this critical trade agreement; while we work together to secure its passage Congress must also stand against the imposition of any additional tariffs that could jeopardize forward progress.”

Michael Dykes, President and CEO of the International Dairy Foods Association said, “On behalf of our dairy industry which pumps $620 billion into the U.S. economy each year, we are making a strong appeal to Congress to vote to ratify USMCA now. To pave the way for USMCA ratification, we ask the Administration to restore a market principled approach to trade – transparent, rules-based and predictable for our North American trading partners. The time has come to focus on what’s important to our economy—maintaining American jobs, growing U.S. export markets, and restoring America’s reputation as a reliable supplier.”

Passage of USMCA would bring a much-needed lift to the United States dairy industry with the U.S. International Trade Commission estimating $277 million in increased sales to our North American partners once the agreement is fully implemented.

 

Source: IDFA

Dairy farmer shares challenging times

Duane Hinchley, like many dairy farmers in Wisconsin, is trying to stay optimistic under the compounding stress of Mother Nature and market forces, but he has something else to be even more optimistic about — something that most farmers don’t — a successor.

Hinchely’s, daughter, Anna, plans to return to the farm after she graduates from the University of Wisconsin-Madison with a degree in dairy science next spring. While most farm kids aren’t coming back to the farm after pursuing higher education, Anna considers herself lucky to have the opportunity. 

“I was lucky enough [my parents] invested in getting milking robots, so I don’t have to work as hard as they did,” Anna said. “My mom was milking nine hours a day and there’s no way I want to do that and, obviously, other people my age don’t want to do that either.”

The milking robots will allow Anna to spend more time managing the diary herd and advocating for agriculture. Hinchley’s Dairy Farm offers tours to give the public the opportunity to learn about one of Wisconsin’s biggest industries. 

“It’s just gonna be me, and hopefully I find a farmer who will [want to] do this with me,” Ann said.

 

Source: Channel3000

Low milk prices prompt U.S. dairy to eye supply management

You can tell every five to 10 years that the American milk situation is getting particularly dire — when they start having discussions about supply management.

Dairy farms in the United States are in their fifth year of chronically low milk prices, which declined quickly in late 2014 from about $25 per hundredweight of milk to a range of $15 to $18 per cwt. since.

That’s made dairy farming a tough business for smaller farmers. For example, Wisconsin is losing about 30 dairy farms per month.

The situation has farm organizations, desperate for solutions, pitching supply management.

Canadian dairy farmers, along with most poultry farmers, control supply of milk, chicken and eggs through their commodity boards (backed by legislation) and by the purchase of quota for certain levels of production by farmers. That has meant a more stable pricing system.

However, as more dairy imports have been allowed into Canada, farmers here have had to compete with lower-priced classes of milk, so the Canadian price of milk is more influenced by world price than in the past.

It’s not just the American price that’s low. World prices are also stubbornly low.

I’ve seen this before.

The last major downturn resulted in the Co-operatives Working Together (CWT) initiative, developed by the National Milk Producers Federation, in which most major dairy processor co-operatives in the U.S., which process most of the country’s milk, created a system, paid for by dairy farmers, that helped farmers reduce their milk production.

It has become an organization that facilitates greater exports of milk around the world, which has helped the American industry, but also is contributing to the global glut in milk.

In the past, before the U.S. became such a major export player, the world had to work through gluts in exported milk from New Zealand, Australia and Europe, but not the U.S. That’s changed since the U.S. has increased its exports to 15.8 percent of its production in 2018, according to the U.S. Dairy Export Council.

Managing an overburdened supply situation is not a short-term issue. I’ve been told that a two percent fluctuation in supply and demand in the U.S. will move milk prices from peak to valley. I was told at the World Dairy Expo last fall that the oversupply number is closer to four percent in the U.S., not including the run-up in milk exports of the past five to 10 years in the U.S.

That will take a lot of smaller (or larger) farmers going out of business to push that number to where prices will improve.

I don’t expect we’ll see supply management in the U.S. any time soon. The dairy business there, unlike hogs and poultry, hasn’t seen a large amount of consolidation. There are many thousands of smaller family farms making milk. I was also told that some believe that final consolidation is underway with this downturn. The smaller farms, without multiple locations and integration with processors, won’t survive this time.

It’s like a tale of two cities: larger producers tied to exporting processors will not want supply management. Smaller farmers will. As we know from the Canadian experience, the rest of the world gets grumpy when a country managing supply also tries to export.

The U.S. today exports almost 16 percent of its record production, the largest in the world. That’s a lot of milk production to reduce, and, despite challenges posed by lower milk prices, larger U.S. dairy farms I’ve talked to see their future in filling export markets.

 

Source: The Western Producer

Herd size doubles on Finnish unit and Norwegian Red genetics play a part

Finnish dairy producer Andreas Johansson and his wife Sonja are doubling cow numbers on their unit on the island Heisala, a 45-minute drive south from Turku (Åbo in Finnish), in western Finland.

They will increase herd size by breeding replacements and using sexed semen on heifers and buying in extra heifers. The focus will be mainly on Ayrshire genetics and some Norwegian Red sires, especially polled sires and those with SpermVital semen available to promote fertility in the herd.

Andreas Johansson’s family are well known dairy breeding enthusiasts. Finnish Ayrshire bull 23004 Heisalan Ponnistus was bred by Andreas’s parents. This bull made his mark in Norway through his two well-known Norwegian Red sons with 11039 Skjelvan and 11229 Oksjale.

Andreas’s parents Magdalena and Åke help him and Sonja on the farm. He admits that the family genetics have been passed down and Andreas admits that he has inherited his mother’s passion for cattle breeding. This has resulted in him breeding 10 elite bulls from the farm.

Andreas sits on the Board of the Finnish cattle breeding organisation Faba coop, and Viking Genetics, the international breeding organisation partly owned by Faba. He remains a firm supporter of red dairy genetics, despite the increasingly high profile of Holsteins in Finland; a trend he puts down to producers who are extending their dairy business and taking ideas from units in Denmark and the Netherlands.

“The Holstein dominates in these countries,” says Andreas. “Producers come back convinced they must have Holsteins to succeed in a modern robotic-milking system.”

But he says that many don’t understand that it’s more than milk yield that matters. “Claws and health are important and for me, the size of the Ayrshire is also better as feed efficiency is important too. The red breeds have good feed efficiency, and this means that their financial results are good too.”

Doubling cows

Andreas is increasing cow numbers from 60 to 120. To accommodate the bigger herd he’s planned a new 1,500 square metre building and two robot milking machines at an estimated cost of 1.4million Euros. He’s already built a new calf barn costing 100,000 Euros. Subsidies – amounting to 40% of the cost – and subsides on interest payments have been used for this project.

As for the breeds; he will continue to have a core of Ayrshire cows; currently three quarters of the herd is Ayrshire. He has some Jersey cows but these will be phased out.

Norwegian Red sires will also be used; he’s already used 11819 Onstad and 10795 Hoøen. “I look for the same traits in all the sires that I use,” he says. “Production index, that includes milk and the fat and protein content, udder health and milking speed are important to me. I also want a cow with good functional traits, that looks good but not a show type cow.

“And I prefer bulls that produce polled offspring. This reduces the costs of dehorning; a practice that is debated, so it’s better if we don’t have to do it.”

Norwegian Red sires Onstad and Hoøen satisfy these requirements and he have used SpermVital semin from thes two bulls in his herd. This technology, developed by Geno, prolongs the lifespan of semen and improves fertility.

“Many producers in Finland use SpermVital sperm on cows with difficult heat periods.I do, and it works very well. I’d use more, if there were a wider selection of Norwegian bulls with SpermVital sperm.”

Island forage

Andreas harvests between 1,000 and 1,200 round bales of silage from Heisala and four other islands. All grass harvesting equipment is jointly-owned with a cousin of Andreas, and they work as a team to harvest the grass.

He now has access to nearly 500 hectares of extra grassland to provide the additional forage needed for his increased herd size. The current subsidy system means he doesn’t have to pay rent for this.

This is just one agricultural incentive that Andreas says has been good for keeping smaller farms in production. “But the disadvantage is that high support keeps prices down on Finnish agricultural products,” says Andreas, “Dairies know what producers receive in subsidies and take advantage of this to keep prices down.”

Cows are feed with milled grains sourced directly from cereal producers and milled on the farm, and minerals. Cows are fed concentrates in the milking robot.

With more space in the new accommodation that will offer better cow comfort and the drive of improved genetics, Andreas is hoping to realise the potential of his herd. He is targeting yields of 11,000 kg. Today the yield is 9 850 kg EKM. “This should be possible; I already have cows producing between 14,000kg and 15,000kg in a lactation,” he says.

Norwegian Red’s breeding organisation Geno has close collaboration with Viking Genetics on the sale of semen in the Nordic markets. “The most popular bulls in Finland are 11819 Onstad, 11039 Skjelvan and 11690 Roen,” says Lars Skramstad, CFO at Geno. Around 10,000 doses of SpermVital semen from these sires have been used between 2016 and 2018, and demand is increasing.

Norwegian Red genetics is available through FABA in Finland. FABA is co-owner of Viking Genetics.

Facts

  • Location: Santalahti, Heisalain Finland
  • Owners: Sonja and Andreas Johansson
  • Children: Two children aged five and seven
  • Land: 220 hectares owned and rented (80 ha rented across five islands; approximately 50 hectares of this is used for forage production
  • Size: 60 dairy cows, increasing to 120 cows
  • Current yield: 9,847kg EKM/cow
  • Annual delivery: 500,000 litres

SpermVital

The idea behind the SpermVital technology is to extend the life of spermatozoa after insemination. To achieve this, sperm cells are immobilized in a natural substance before cryopreservation. This immobilization preserves energy and enables a controlled release of sperm cells in the uterus after insemination over an extended period of time. This makes timing of insemination less critical with regards to ovulation in the female and increases the odds of fertilization success.

The advantages of the technology are:

  • Timing of insemination will be less critical.
  • Conception rate will be higher than or at least equal to conventional semen.
  • Inseminations per heat can be reduced.
  • Inseminations on weekends and public holidays can be reduced or avoided altogether.
  • Conventional insemination equipment and technique is used. (we recommend 36-38°C for at least 1 minute, and then inseminate as soon as possible)

SpermVital reduces insemination costs and improves herd fertility. These are both factors that lead to increased profitability.

SpermVital semen is available on a selection of Norwegian Red sires and other additional breeds.

https://www.norwegianred.com/Start/About-Geno/Spermvital-technology/

Norwegian Red is the main dairy cattle breed in Norway, developed by Geno SA. Geno SA is a farmer-owned cooperative that has been breeding Norwegian Red dairy cattle since 1935. Geno sells over 1 million doses of semen from elite Norwegian Red bulls each year and distributes genetic material to more than 30 countries worldwide. Geno’s vision: Breeding for better lives. Geno’s head office is in Hamar, Norway.

 

A Productivity Revolution Is Wiping Out (Most) Dairy Farms

Dairies are closing partly because of changing consumer tastes and trade tensions, but mainly because the industry is continuing a century-long consolidation.

Almost 800 dairies have closed in Wisconsin in the past 12 months, which sounds bad. Over the past 75 years, though, the state has been losing dairies at an average rate of more than 2,000 a year. It has only about one-quarter as many dairy farms as it did just 25 years ago. In other words, dairies shutting down in Wisconsin is not some new thing.

Data from before August 2003 includes sheep and goat dairies, which constituted 0.8% of the state’s dairies at the time.

As is clear from the above chart, the percentage losses have increased sharply over the past two years. The nationwide rate of dairy closings, while not available on a monthly basis and usually not as high as the Wisconsin rate, also jumped to 6.9% in 2018 from 3.9% the year before (and a compound annual rate of 3.8% over the previous decade), so talk of a dairy crisis in Wisconsin and elsewhere — and the role that oat-milk drinkers and President Donald Trump’s tariff wars may be playing in it — is not unwarranted. Still, this crisis has to be understood within the context of a dairy industry that has been consolidating for more than a century.

As of the end of last year, there were 37,468 licensed dairies 1 nationwide, and 8,500 in Wisconsin, more than any other state. Wisconsin appears to have held the most-dairies title since the 1950s. 2 It became the biggest milk producer in the 1910s, passing New York, but fell behind California in the early 1990s. Over the past decade, interestingly enough, it has been catching up.

California’s rise to the top in dairying was the work of a relatively small number of dairy farms that were much bigger than those in Wisconsin and elsewhere in the Midwest, South and East. The state’s mild, mostly arid climate allowed for larger herds than were then manageable in more humid, bovine-disease-prone regions, and its abundant alfalfa (which grows year-round there and thus produces more than twice the national average yield per acre) made it easy to feed them. Meanwhile, spectacular population growth, from 7 million people in 1940 to almost 30 million in 1990, coupled with long distance from traditional dairying regions that made bringing milk in from elsewhere expensive, necessitated a rapid ramp-up in milk production that favored bigger operations. By 1959, while it only had about one-fifth as many dairies overall as Wisconsin, California had more dairies of 200 cows or more than all the other states combined.

These cows also produced more milk, on a per-cow basis, than their peers in other states. The U.S. Department of Agriculture’s annual pounds-of-milk-per-cow statistics, which are available starting from 1970, 3 show California’s bovines in first place every year through 1982. By then, California-style dairying had spread to other Western states: Washington took the productivity lead in 1983, and over the next three decades battled it out with Arizona, California, Colorado and New Mexico for the top spot.

In 2017, though, Michigan’s cows wrested it away. They held on to their No. 1 ranking in 2018, at 26,340 pounds of milk per cow, and Wisconsin, Nebraska, Iowa, New York and Kansas all had per-cow yields higher than California’s 23,306 pounds. This was partly due to a dairy exodus from California: Encroaching residential development has all but extinguished the industry in its former Southern California heartland of Riverside and San Bernardino counties, and environmental regulations now make it tough to open new dairies elsewhere in the state. As a result, California dairy farmers have been emigrating to other Western states for a while now, and lately some have opted for the Midwest, thanks to advances in ventilation techniques that have enabled the construction of indoor, California-scale dairy operations in less temperate climes (I wrote about this phenomenon last fall, while Esquire’s Ryan Lizza told the story of one particularly noteworthy former California dairy farmer — U.S. Representative Devin Nunes — whose family has shifted its operations to Iowa).

Still, most of the big new dairies in Michigan, Wisconsin, Nebraska, Iowa and the like are run not by California transplants but by locals who decided they had to get bigger to survive. In Wisconsin, the shock of losing the status of top dairy state also seems to have been a motivating factor. The nationwide trend toward bigness is quite apparent from the Census of Agriculture conducted every five years: In the 2017 edition, dairy herds of 1,000 head or more for the first time accounted for more than half the nation’s milk cows, up from 10% in 1992.

Not coincidentally, while 2017’s total milk cow count of 9.5 million was little changed from 1993, milk production rose 44% over that period. Since the 1920s, the number of milk cows in the U.S. has fallen by more than 50%, and production has more than doubled. Bigger dairies aren’t always more productive on a per-cow basis than smaller ones, but they tend in that direction: A report from the University of Wisconsin’s Center for Dairy Profitability based on 2014-2016 production data from 251 Wisconsin dairy farms found that annual milk production per cow averaged 19,445 pounds at farms with one to 49 cows and 26,916 pounds at those with 500 to 999 cows. The report didn’t include production data for Wisconsin farms even bigger than that, but it did have information on their profitability:

Bigger dairies can spread their overhead costs over more cows, and can thus afford better milking equipment, productivity software and ventilation technology, among other things. The causation also works in the other direction, says Andrew Novakovic, a professor of agricultural economics at Cornell University, as better-run dairies are likelier to invest in expansion, and poorly run big dairies are likelier to be driven out of business because big dairies tend to have much more debt relative to assets than small dairies do. Those high debt ratios help explain why the return on assets is so much higher at the biggest dairies. They are higher-risk, higher-return enterprises.

All this would seem to represent economic progress in action. Environmental progress, too, in the sense that higher production per cow means lower greenhouse-gas emissions per quart of milk. But such change can be wrenching for the dairy farmers being left by the wayside, and for the communities where they live. “I sometimes refer to it as an economic miracle wrapped around a social tragedy,” Novakovic wrote in an email. 4

It’s been especially tragic lately because of a confluence of factors, starting with a 12% decline since 2010 — after decades of little to no change — in U.S. sales of fluid milk. Rising cheese and butter sales have meant that overall U.S. consumption of dairy products has kept rising on a milk-fat equivalent basis, but fluid milk tends to be more profitable than other dairy products, and the shift in the demand mix has left many dairies, and the farmer-owned dairy cooperatives that process and market most milk products in the U.S., scrambling. So have demand shifts within categories. As Bloomberg’s Lydia Mulvany and Leslie Patton reported last October, even amid a general cheese boom, bright-orange American cheese slices have been losing out, which has been tough on the Minnesota and Wisconsin dairies that produce the bulk of the raw material for them.

The result has been a drop in the average milk prices paid to farmers, from $25.46 per hundredweight in 2015 (and $20.45 in the 10 years before that) to $16.20 in 2018. And while such price drops have in the past led to production declines with a lag of three years or so as dairy farmers cut back their herds and brought the market back into balance, that hasn’t really happened yet this time, possibly because of the ongoing shift to bigger dairies. “As we’ve moved to larger-scale operations with different scales of financing, the ability of larger units to produce milk even in low-price periods is basically extended,” says Peter Vitaliano, chief economist at the National Milk Producers Federation. In some cases, he adds, continuing to produce is even an imperative to make debt service payments and otherwise keep the bankers happy.

Finally, there are the trade wars. Exports have accounted for only 4.4% of U.S. dairy production over the past decade, much less than for some other agricultural sectors (with soybeans, it’s been 46.3%). In April, Kevin Drum of Mother Jones put together a bunch of dairy-related charts showing that “neither production, nor price, nor export trends have changed even slightly during Donald Trump’s presidency” — which would seem to indicate that Trump’s tariffs and the reactions of trading partners such as Mexico and China haven’t been a major cause of dairy’s troubles. Also, on the plus side for the dairy industry, the Trump administration recently eased restrictions on the use of milk in school lunches. But the trade tensions may be putting downward pressure on the prices of specific products. And they’re definitely one more thing stressing out dairy farmers who already have a lot to worry about.

Source: bloomberg.com

Coles to cut out milk processors, and deal directly with Australian dairy farmers

Coles has announced it will bypass processors and contract milk directly from dairy farmers in NSW and Victoria from July 1.

In the past, Coles has used processors to source milk for its homebrand products, with Norco contracted in NSW and Queensland and Saputo sourcing milk from Victoria and Southern NSW.

The new model will offer longer term contracts that allow farmers to choose from one, two or three-year contracts.

It marks a shift to a model more in line with competitor Woolworths, where the supermarket will be able to offer a direct price to farmers.

Coles chief operation officer Greg Davis said in a press release it would offer a “competitive farm gate price”, but did not specifically reveal a price.

“In addition to offering a fair and competitive price, dairy farmers will have more choice regarding the length of contract and more certainty around income,” he said.

“If the model works as we hope it will, we will look for opportunities to expand the footprint to other milk-producing regions and potentially other products in the dairy case.”

The ABC understands Coles representatives have met with farmers in Victoria over the past few months.

Coles said it would also contribute an additional $1.9 million for research into the Coles Sustainable Dairy Development Group.

The cost of homebrand milk for two and three-litre milk will remain unchanged at $2.20 and $3.30 respectively.

‘Devil will be in the detail’, say farmers

President of farm group Dairy Connect, Graham Forbes, said Coles appeared to be adopting a model common among UK supermarkets such as Tesco.

It was unclear how Coles contracts and pricing would be structured, however some farmers were hopeful long-term contracts would help give them more security.

Coles said it would offer a guaranteed price for two years and a floor price for the third year.

“It will put a bit more competition out there in the marketplace, and let’s hope it lifts the price to farmers and gives them some long-term security,” Mr Forbes said.

“It will be very interesting to see how it impacts on Saputo suppliers currently in NSW.

“There is a lot of competition from Parmalat at the moment, Lion has been a bit quiet while it’s up for sale, but it will be a very interesting few weeks to see how the processors respond.”

David Inall, representing Australian Dairy Farmers, said he was surprised by the announcement.

“It came out of the blue, it’s early days, we’re not aware that any farmers are contracted to Coles at this stage, but we look forward to more detail around contract and prices,” Mr Inall said.

“They have told us that they will offer a price that they believe will be in the top quartile of what is currently on offer, which is certainly an encouraging sign, which will make it very competitive.”

Mr Inall expressed concern that this could lead to a return to $1 per litre milk.

“But we’d also expect that this will not see a return to $1 per litre milk, that they have not created this model to slide back to $1 dollar per litre milk — that’s a debate we don’t want to have again,” he said.

Processors face fierce competition for milk

According to food industry analyst and director of Fresh Agenda, Joanne Bills, there were reasons why supermarkets were moving to deal directly with farmers.

“In the UK supermarkets have found that you can add transparency to the supply chain and also implement specific processes, standards, or animal welfare requirements,” she said.

“But in Australia it could be looking to avoid some of the fallout from the $1 per litre milk, similar to the way that Woolworths has with its ‘Farmer’s Own’ brand.”

Ms Bills believed that, while the fresh milk market represented only a fraction of the Australian dairy industry, the move to deal directly with farmers would add new competition and complexities for processors.

Coles declined an interview with the ABC.

 

Source: ABC News

New Zealand dairy export volumes set new record

Dairy export volumes have hit a new high after rising 19 percent in the March 2019 quarter, adjusted for seasonal effects, according to Stats NZ figures.

While dairy volumes were strong in the quarter, actual dairy prices fell 7.5 percent. Stats NZ said that means dairy values rose only 9.5 percent, seasonally adjusted.

Dairy products are New Zealand’s top goods export, accounting for more than a quarter of the value of all goods exported in the March quarter.

Total export volumes rose 5.0 percent in the March 2019 quarter, while total export prices fell 2.6 percent, both movements strongly influenced by dairy.

Stats NZ business prices delivery manager Sarah Johnson said total export volumes are at their highest level since the series began in 1990, reflecting higher dairy volumes in the March quarter, after adjusting for seasonal effects.

“The previous peak in dairy export volumes was in the September 2012 quarter,” she said.

“Dairy export prices have fallen for the second quarter in a row, likely reflecting the falling global dairy auction prices seen between June and November 2018,” said Johnson. 

She said there was a lag between auction prices and the time dairy products cross the wharf for export.

 

Source: Newshub.

 

‘Dirty’ dairy farmers to be stopped supplying milk to Fonterra

The Government has announced the first changes in 17 years to the law surrounding the dairy industry. 

While it is going to continue to allow farmers open entry to supply Fonterra, it is also going to allow the dairy giant to refuse milk from “dirty” farmers.   

Federated Farmers welcomed some provisions of the proposed legislation, though was disappointed open entry remains unchanged – “We thought the sector was mature enough for Fonterra to be given some discretion over who to pick up milk from,” said dairy spokesman Chris Lewis.

Fonterra said it represented a missed opportunity to better support New Zealand.

Agriculture Minister Damien O’Connor said the new law would allow Fonterra to refuse milk supply from farmers in circumstances where milk is not compliant or unlikely to comply with Fonterra’s terms and standards of supply or is supplied from newly converted dairy farms.

Fonterra’s terms of supply would be able to relate to matters including environmental, animal welfare, climate change and other sustainability standards.

The DIRA – the Dairy Industry Restructuring Act – will be reviewed on a 4–6 yearly basis, to provide regulatory certainty.

Other changes proposed include:

* Limit Fonterra’s discretion in regard to setting a key assumption in calculating the base milk price.

* Require Fonterra to appoint one member of its milk price panel on the nomination of the Minister of Agriculture.

* Remove the requirement for Fonterra to supply regulated milk to independent processors with their own supply of 30 million litres or more in a single season.

* Update the terms on which Fonterra supplies regulated milk to Goodman Fielder for the benefit of domestic consumers.

Lewis said the “devil will be in the detail”, such as what the definition of a new conversion will be.

“We’re pleased that DIRA is to have more clarity on when Fonterra can refuse supply as there are some very poor farmers who have demonstrated their unwillingness to come up to the standard of all the other shareholder/suppliers out there.”

Fonterra chairman John Monaghan acknowledged the “tweaks” being given to the rules under which Fonterra has to give its farmers’ milk at cost price to foreign-backed competitors such as Goodman Fielder.

“Given the significant increase in competition within the New Zealand dairy industry, we’re disappointed the Government did not recommend removing the requirement for us to supply our farmers’ milk to large, export-focused businesses altogether,” Monaghan said.

“We welcome the Government’s decision to give Fonterra the right to refuse membership to our co-op where a farm is unlikely to comply with our terms of supply, or where the farm is a new conversion. These changes will support our co-op’s ability to meet our customers’ demands and continue leading the industry toward a sustainable future for our farmers and the rural communities in which they live and farm.”

A member of the Fonterra Shareholders’ Council, John Stevenson, said farmers would be disappointed there would be more regulation over how Fonterra sets its milk price, and they would also be frustrated about a lack of a pathway to deregulation. 

“But it’s positive that Fonterra will be able refuse to take milk from farmers who don’t meet their standards.”

Fonterra said it supported greater pricing transparency across the industry and noted “with interest” the Government’s decision that the Minister of Agriculture will be able to nominate one person to sit on the milk price panel.

It said transparency should be required of all processors to publish the average price they pay to farmers, the key parameters of their milk price and examples showing the payout that would be received for different parameters.

A bill to enact the changes will soon be introduced into Parliament, where it will be sent to a select committee for submissions.

 

Source: Stuff

Changes to new Zealand dairy industry legislation

Minister of Agriculture Damien O’Connor today announced changes to the legislation governing the dairy industry.

“These changes will provide certainty for the dairy industry and ensure the sector can pursue sustainable value growth for the benefit of all New Zealanders,” Damien O’Connor said.

Changes will be made to the Dairy Industry Restructuring Act 2001 (DIRA) and the Dairy Industry Restructuring Raw Milk Regulations 2012 (Raw Milk Regulations).

The DIRA was passed into law in 2001 and saw the creation of Fonterra. It also promotes the efficient operation of dairy markets in New Zealand.

“The industry has changed considerably since 2001, and it is important to ensure the regulatory regime puts the sector in the best possible position,” says Mr O’Connor.

“The Government is committed to building a modern and productive economy and that means being smarter in how we work.

”The changes we’re making will support our dairy sector to produce and export high value goods in a way that sustains the environment it relies upon. DIRA drives much of this work and after 17 years it’s the right thing to do to make it fit for the 21st century.

“Following farmers, independent dairy processors, NGOs, and representatives of Maori interests around the country sharing their views, Cabinet this week approved changes to both pieces of legislation. They will now be progressed through Parliament.

“I would like to thank everyone who took part in the process. People will have another chance to have their say on the changes to the DIRA and the Raw Milk Regulations during the Select Committee process and I encourage people to do that. I want to make sure we have a law that is going to work for everyone it affects”.

More information about the proposed changes to the DIRA is available on MPI website:www.mpi.govt.nz/dira-review

Key Changes to DIRA and the Raw Milk Regulations:
• Retain the open entry and exit provisions, with qualifications, to manage ongoing risks arising from Fonterra’s large size and scale in New Zealand dairy markets.
o Allow Fonterra to refuse milk supply from farmers in circumstances where milk is not compliant or unlikely to comply with Fonterra’s terms and standards of supply or is supplied from newly converted dairy farms.
o Clarify that Fonterra’s terms of supply can relate to, and price differentiate on the basis of, various on-farm performance matters, including environmental, animal welfare, climate change and other sustainability standards.
• Limit Fonterra’s discretion in regard to setting a key assumption in calculating the base milk price, the asset beta.
• The DIRA shall be reviewed on a 4 – 6 yearly basis, to provide regulatory certainty.
• Require Fonterra to appoint one member of its Milk Price Panel on the nomination of the Minister of Agriculture.
• Remove the requirement for Fonterra to supply regulated milk to independent processors with their own supply of 30 million litres or more in a single season.
• Update the terms on which Fonterra supplies regulated milk to Goodman Fielder for the benefit of domestic consumers.

 

Source: Scoop

Are Dairy Boards ‘Closed’ to Women?

Dairy farming is not a career for the faint of heart.  Whether your focus is on the cows in the barn or delivering products or services to those who work with cows in the barn, you face many challenges.  If, in addition, you are female, you also face being sidelined or ignored when it comes to leading boards of directors or being selected to join those making decisions for the dairy industry. In agriculture, we like to see ourselves as immune to the faults of Fortune 500 businesses. However, when it comes to combating gender stereotypes and championing the cause of women in leadership, dairy has its problems with putting ladies on the ladder to success and welcoming them to the board room table

MENTORS, ROLE MODELS and MEN’S SHIRTS

In 2019 there are still far fewer female dairy farm owners than men.  Most veterinary, financial, suppliers and dairy support businesses reflect this same inequity of gender in their managers and leaders.  Not only do ag women earn less on average than ag men, but there is also an added economic punishment for being the only sex that can bear children. This is not new. Woman multi-task and we do it well.  What is new is that woman are asking to be recognized for their abilities not punished for their gender differences. Women want their leadership voices to be heard.

Dairywomen take ourselves seriously, and it is time that our industry did that as well.  We are professional, efficient and effective in the dairy world. Let’s be recognized for that.  We know how to mentor and be mentored by those who are successful. Oh – and when we do represent our business in the public eye let’s find a way to brand ourselves – not as company men in pants and shirts – but in professional attire that is appropriate to the work being presented. Too often, the company dress code requires women to look – uncomfortably — like men. Company colors, yes!  Company clones no!  Celebrate the uniqueness that makes a difference to success!

MISSES, MRS AND MYTHS IN AGRICULTURE

The mothers who raised farm daughters in the past emulated their mothers and added their experience to the teaching.  We all have stories of female farmers who handled the bookwork for the family-run businesses.  Their meticulous records of inventory, purchasing, banking and employees were a model of management for any successful business. Learning from their office style desk was a good start for career management. Women learned their passion for dairying in the barn, in the fields and in the office.  When it came to careers, the expectation was to continue to take a role in making effective changes wherever they were needed.

Universities report rising numbers of women in agricultural courses.  In some, women outnumber the male students.  This is encouraging when there are many problems facing all sectors of the agricultural industry. Economics, animal genetics, political and human sciences and technology need to have strong leadership if dairy is to be relevant in the future.

However, when it comes to the business world and companies that lead the way in agriculture, the gap is once more a wide one between the genders.

So, what options do today’s dairy girls have? Do they ‘man up’ and become ‘one of the boys’ in the background or accepting lower levels of decision making or do they turn their years of experience on the farm and their passion for dairying into an ownership and management career?

A WOMEN’S PLACE IS IN THE BARN.

A WOMEN’S PLACE IS ON THE BOARD.

Where is a woman’s place?  Why are there boundaries?  We spend much time applauding women who step into managing the family farm, but recently the question has turned to “Why are there so few women in the boardroom?” of dairy associations, boards and councils?

Unfortunately, we live in a world where having just one woman on the board or senior management team of an ag company is seen as “progress”.  Sadly, it is also true that some companies have yet to appoint even one woman to their board.  Statistically, we know that for every 100 men promoted to manager positions, only 77 women are promoted and that women are more likely to take a top spot in a revolving door capacity, filling positions previously held by a woman. Is this happening in the business you work with and support?  Issues such as compensation and placement in the boardroom still have some way to go before equality is reached. Does it happen on your dairy board or farm-related business?

FEARLESS FARM FEMALES. FIVE CHARACTERISTICS

  1. Women are not embarrassed to be females in agriculture. They’re empowered.
  2. They don’t see their position as a women’s position but as a dairy position.
  3. No matter where their dairy job takes them, they always study to learn how to do it efficiently, effectively and economically.
  4. Flex time is prioritized according to the goals of the organization.
  5. They care more about leading than about being liked.

You probably have all kinds of questions arising from these five statements.  Of course, any one of them could be a source of conflict.  The team that is involved can make an enormous difference in the ability of both men and women to succeed. The entire team has to buy into finding solutions. The dairy industry is facing challenges on all sides and maintaining a viable dairy or service company is becoming more and more difficult. It is a huge learning curve for everyone – male or female – who is motivated by a desire to do what is best for dairy.

Woman face a double-edged sword. Being a woman in a male-dominated environment offers an effortless point of difference.  Woman and men are not exactly the same. We can be fearless.  We can charge on. Or we can be left alone in the spotlight that seeks out and highlights every weakness and blames it on gender.

DOES BREAKING THE GLASS CEILING AUTOMATICALLY LEAD TO THE GLASS CLIFF?

Perhaps, like me, you have been encouraged by the progress women are making in all aspects of the dairy business? As an industry, we are recognizing that we can’t afford to overlook half of the people that could be involved on the basis of gender alone.  We love stories of women having success in turning things around.  That is all good.  However, these are not the easiest of times to take a leadership role in managing a dairy or a dairy business.  What if things not only don’t change but what if they fail entirely?  Reasoning says that either outcome is possible in today’s problem-ridden climate.  However, there is a new term that is being used when this happens to a woman. It is called the Glass Cliff.

The metaphor of the glass cliff evokes the idea of women who have risen higher are now in a precarious position.  They are teetering on the edge, and their fall might be imminent. It has been suggested that women are being set up to fail. They earn leadership positions at the time when conditions are at there worst. Are they victorious, or will they be victims? When they fail is the too often voiced opinion for the outcome, “Women can’t lead.”

FREEING FARM WOMEN – AND MEN – FROM GENDER STEREOTYPES

We are always more comfortable when we feel we are in the right place at the right time and doing the right job. Such serenity is hard to come by in this age of instant pictures, news and studies that have the purpose of moving us to an uncomfortable place where we will buy, sell or change something and, in so doing, benefit the company that has raised our needy awareness. 

In the case of gender stereotyping, we are quick to recognize when it applies to our own gender. In my case, wife, mother, grandmother, being around men much of the time, I can’t help but question if they recognize their own stereotyping issues as well. 

Male Stereotypes:

  1. The Dad at Home
  2. The Dad at the Playground
  3. The Dad in the Kitchen.

I’m sure you can add more to this list if you think of those groups that have an unconscious bias against men. It shouldn’t be about gender, should it?

At the end of the day, it boils down to what we receive credit for.  We seek to please.  Sometimes I wonder why men get an “Atta Boy” for babysitting on the weekends. Old boy’s clubs are renowned for glad-handing and back-slapping when a project is successful. Why is that an exclusive club? It shouldn’t be about gender equality. It should be about ability.

ARE WE READY TO GET THE WHERE-DO-WE-GO-FROM-HERE MINDSET?

We can’t say we have looked at gender stereotyping from all angles until we consider today’s technology.  A UN report has said that virtual assistants such as Alexa and Google Assistant reinforce gender stereotypes by portraying women as “subservient”, by relying on female voices. As in anything, you can criticize until the cows come home, but what can you actually do about it?

Here are some practical strategies to talk about in your dairy workplace.

  1. Vary between ‘feminine’ or ‘masculine’ skills sets or attributes as needed on the Board.
  2. Focus on the positive elements of the Board goals instead of dwelling on the negative.
  3. Speak up about discriminatory selection or promotion practices
  4. Call for Board recruiting practices that actively encourage women to apply
  5. Support fellow women in leadership in the workplace.

THE BULLVINE BOTTOM LINE

We seem to be in a bit of a time warp. It is encouraging to see the steps that have put a million little cracks in Ag Leadership glass ceilings in the last 20 years. I’m grateful for women who run their own dairies, cooperatives, supply businesses and veterinary and health services.  My hope is that as the next generation of women can continue their dairy passions and have careers that will see them soar to unlimited possibilities. The doors are open.  To everyone.

 

 

 

Get original “Bullvine” content sent straight to your email inbox for free.

 

 

 

Dairy Farmers Have Another Thing to Worry About: Swine Fever

Yet another market is being shaken up by the African swine fever raging in Asia: Surprisingly, it’s U.S. dairy farmers.

Pigs eat components of whey, which is a cheese byproduct. Because China’s herd is shrinking due to swine fever, demand is plummeting. In addition, due to the Asian nation’s trade war with the U.S., it has started sourcing the whey it does need from other countries.

Pricing has already been impacted. Whey powder prices have dropped as much as 20% this year, while a whey component known as permeate has lost half of its value since February. This comes as dairy farmers have battled years of unprofitable milk prices as supplies outpace demand.

“There’s a double hit,” said Blake Anderson, chief executive officer of the
American Dairy Products Institute. “There’s the swine flu situation and then there’s the ability to even get product into China, for example, due to various trade barriers or tariffs.”

Whey prices are taking a pounding from spreading swine fever in China

U.S. dairy farmers could see a reduction of 50 cents per hundredweight or more off their milk checks due to the dynamic this year, said Mary Ledman, global strategist for dairy at Rabobank.

And it’s not a one-year problem, given how much the population of sows in China may have decreased, she said. It could be as much as 50%, according to Gabriel Sevilla, vice president of global sales and marketing at Proliant Dairy Ingredients. That could lead to up to a 150,000 metric ton reduction of whey permeate, he said.

The company’s Chinese customers have said that 2019 will be the worst year for feed mills in two decades.

Prices could turn around if the trade war ends, and higher pork prices could eventually encourage Chinese farmers to repopulate their herds, Sevilla said.

Demand could also increase as China’s hog industry is likely to consolidate, moving away from smaller farms. Those big and more professionally-managed facilities are likely to increase the amount of dairy products in their feed ration, bringing it closer to the amount used in countries like the U.S., Rabobank’s Ledman said.

“This is going to impact all of us,” said Henrik Andersen, chief executive officer at Arla Foods Ingredients. “When prices in the feed segments go down, it tends to impact the other segments as well.”

Dairy farmers have already been battling years of unprofitable milk prices as supplies outpace demand. Small operations in particular have been unable to stay afloat. In Wisconsin, known as America’s Dairyland, nearly two dairies a day exited the industry in 2018 due to the pressures.

Source: bloomberg.com

Send this to a friend