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US dairy farmers hopeful ahead of trade deal, industry expert says more work to be done

Announcement of a trade deal agreement was great news to Wisconsin dairy farmers Tuesday, who have been hoping for revised trade with two of their top exporters in the world for years.

Mitch Breunig, who owns Mystic Valley Dairy, said he is hopeful this will help turn around downfalls the industry has had the last three years, where he’s seen other dairies closed due to changes in the international market.

“It’s kind of, I have a market, and thank goodness I have a market because some farmers haven’t been so lucky,” he said.

Breunig said years ago when Canada stopped taking ultra-filtered milk from the U.S. it was the final nail for many of his colleagues.

“It was really disappointing that sort of politics came into play and really affected family farms that had been in business for a long, long time,” he said.

Wisconsin state and national lawmakers are hopeful the agreement will turn things around at home, too.

“USMCA is a win for Wisconsin, for our dairy and manufacturing industries, and for middle class families,” said Rep. Bryan Steil, R-Janesville.

Rep. Ron Kind, D-La Crosse, released some details about the agreement that he said he worked for, including the dairy program Breunig mentioned, as well as increased labor and environmental standards.

“Raising standards in trade agreements to level the playing field for workers, farmers, and businesses is vital so we are not trying to compete in a race to the bottom that will jeopardize jobs in America,” Kind said in a statement.

Mark Stephenson, the director of dairy policy analysis at the University of Wisconsin-Madison, said this deal gets the U.S. dairy industry back about where it was in the original North American Free Trade Agreement, and it was the best the U.S. could get after fractured relationships from the original call for a renegotiation. 

Since then, Mexico has had to look for other trade partners in the European Union, he said, and more work needs to be done to repair the relationship between the two countries.

Stephenson said that will come from good service from Wisconsin dairy farmers and producers.

Breunig said he knows there will be work to build trust back among the U.S., Mexico and Canada, but with an agreement in place he’s looking forward to what is hopefully a bright future.

“Anything we can do to have a higher milk price really makes a difference on our family’s farm and investing for the future and being able to stay in business,” he said.

The House is expected to vote on the deal as early as next week. Sen. Majority Leader Mitch McConnell said the Senate will take it up after the impeachment trial.

Source:  channel3000.com

For Canada, USMCA ends uncertainty, but concern lingers for the dairy and aluminum industries

Ray Laing followed the on-again, off-again negotiations to revamp NAFTA closely — and concluded he was on the losing end of the new deal.He worries the agreement, which opens up more of Canada’s long-protected dairy market to the United States, will eat into demand for the roughly 660,000 gallons of milk produced each year at his Laingspring Farm in Steinbach, Manitoba.
But as representatives of Canada, Mexico and the United States signed the pact in Mexico City on Tuesday, Laing was willing to cut Canada’s negotiators some slack.“This was the best of a bad situation,” he said from the farm that has employed five generations of his family.The U.S.-Mexico-Canada Agreement, or USMCA, was greeted largely with a communal exhale here, not because it dramatically benefited Canada or modernized trade, but because the country averted worse outcomes, and many worried about its prospects in the midst of an impeachment inquiry. The deal remains to be ratified by the members.The United States is Canada’s largest trading partner — roughly 75 percent of its exports flow to its southern neighbor — and uncertainty over the pact’s future rankled many. The Bank of Canada this month identified trade conflicts as the main risk to Canada’s economy.

“This negotiation has been an existential challenge for our country, and at times, an existential drama,” Deputy Prime Minister Chrystia Freeland said at the signing ceremony.

Canada had already scored small gains in the initial version of the USMCA last year. It won in its efforts to preserve the dispute settlement process in NAFTA’s Chapter 19, which allows the members to challenge one another’s countervailing and anti-dumping duties before a binational panel.

Under the most recent deal, which was revised to satisfy the demands of Democrats in Congress, Canada ticked off a few more items on its wish list.

Officials cheered the removal of a provision in last year’s agreement that would have extended patent protections for the special class of drugs called biologics to 10 years, increasing costs for Canadian patients. The United States agreed to end panel-blocking, which gave countries the ability to obstruct dispute settlement by refusing to appoint arbitrators.

“All of the new measures line up with Canada’s interests,” said Dan Ciuriak, a former deputy chief economist in Canada’s foreign affairs and trade department.

But not everyone is pleased.

Canada’s main concession in last year’s agreement was to give the United States slightly more access to its dairy market. It also agreed to end a pricing system that limited imports of the industrial milk ingredients known as Class 7 dairy products.

Canada’s politically influential dairy lobby has objected to the changes. Pierre Lampron, the president of the Dairy Farmers of Canada, described the agreement as a “sad chapter” for Canada’s dairy industry. “Would the U.S. ever accept such terms?” he asked.

The Canadian government said this year it would spend $1.31 billion over eight years to compensate dairy farmers for their losses.

“I think the government could have always done more,” Laing said. “But I’m not sure it had much of a choice.”

Canada’s aluminum industry is also upset. Mexico agreed to tighten the automotive rules of origin for North American steel, but not for aluminum.

Prime Minister Justin Trudeau, campaigning for reelection this year, touted the trade pact as one of his key accomplishments. A Liberal Party campaign ad, narrated by Freeland, boasted that his government “stood up to Donald Trump on trade.”

Canada has said it will ratify the trade pact “in tandem” with the United States. Trudeau, whose government was reduced to a minority in the October election, will need the support of one other party to ratify the pact. He should get it, but a vote is not expected until the new year.

The deal capped what Freeland described as a “long, arduous, and at times, fraught negotiation.” President Trump levied tariffs on Canadian steel and aluminum, citing national security concerns. He called Trudeau “very dishonest & weak,” and threatened tariffs on Canadian autos.

“Given the size differential and the power disparity between the United States and the two other countries, it was a challenging negotiation,” said Drew Fagan, a professor of public policy at the University of Toronto. “We have never dealt with an administration like this one, but Canadians are both mild-mannered and forgiving, and this, too, shall pass.”

Freeland, speaking to reporters in Mexico City on Tuesday, spoke of the negotiations’ numerous “false dawns,” when it felt as if a deal was imminent, only for talks to stall.

“In the story of the boy who cried wolf, the wolf does eventually arrive,” she said.

Source:  washingtonpost.com

ND man survives after being trapped in grain bin

A North Dakota man is lucky to be alive after getting trapped inside a grain bin for over an hour.

It all happened Sunday afternoon in Lankin, with the man submerged in over 15 thousand bushels of corn.

“Every minute’s crucial,” Terry Novak, a member of the Lankin Volunteer Fire Department said.

In a race against the clock dozens of area first responders rushed to the Lankin farmstead, while Novak went down the road for his backhoe to tear the bin open.

“When that first flush came out, I was just praying that he would come sliding out. Obviously that didn’t happen. So, we had to go in and dig more,” he said.

While Novak dug with the backhoe, the rest shoveled their way through the bin. But as minutes turned into an hour, Novak said the grim thought of their rescue becoming a recovery flooded into the back of everyone’s mind.

“But nobody gave up,” Novak said.

Rescuers finally came upon the man just before two that afternoon, still alive after breathing through his teeth for most of his time trapped inside.

“Once they found him it was still crucial too because there was still corn that could come down and bury him a second time. So, it was so intense through the whole thing,” Novak said.

As medics carried the man out on a stretcher, Novak says he vividly remembers the somber quiet that fell on the farmstead as everyone finally breathed a sigh of relief for the first time.

“I wanted to stand up out of the backhoe and just cheer,” Novak said.

Novak says the man only suffered a dislocated shoulder and is doing well.

“Of all of us being so emotional and everything, he is such a cool, calm person. Maybe that helped him. We were active and everybody was moving, but he had to slow himself down. He had to bring his peace of mind being buried,” he said.

And although it’s been well over 48 hours, Novak says the day and the ‘what ifs’ haven’t yet left his mind.

“Everything just worked out. You think of things you could have done, but for some reason everything worked out. “Don’t give up. That was over an hour. Don’t give up,” Novak said.

Source: valleynewslive.com

All Breeds All Britain Calf Show Judges Confirmed for 2020

The annual All Breeds All Britain Calf Show will again be held at the East of England Showground, Peterborough. Organised by Holstein Young Breeders (HYB), the Calf Show is a highlight of the dairy calendar and will be held from 16th-18th October 2020.

In addition to the Holstein classes, the show will feature six other dairy breeds: British Friesian, Jersey, Guernsey, Brown Swiss, Ayrshire and Dairy Shorthorn. HYB competitions extend beyond the show ring and with support from principal HYB sponsor Semex, other HYB awards are presented at this event and throughout the year.

The Littlestar Award will be presented to a HYB member aged 17 years or under, who has made an outstanding contribution to the Holstein breed and their HYB Club.  The winner of this prestigious award will receive the Littlestar painting, which will be presented during the prize giving at the Show. Other accolades include stand competitions, the Louise Hartley Award and the acclaimed Dick Stapleton Award. This is presented to a young breeder, of any age and from any breed, who is recognised by the ABAB team for being extremely helpful and always going above and beyond when contributing to their Club and breed.

Adding a little competitive fun, contending teams will be required to construct stands based on the event theme, which will be confirmed over the next couple of months, whilst also making sure their cattle lines and calves look immaculate. The team who embraces the theme the best is rewarded for its inspiration and efforts!  

Judges Announced

HYB is delighted to have the expertise of Ben Yates as National Holstein Calf Show judge and Brian Weatherup Jr as master judge for the National Holstein Showmanship Competition.

Ben Yates is farm manager for the Y-Farm Partnership, Shepton Mallet, Somerset, which is a modern dairy unit milking 1,200 Holsteins. With his wife and two boys, Ben also has a small herd of his own animals under the Wowcow prefix. During his time managing The Wyndford Herd in Shropshire, Ben enjoyed success showing animals he’d bred across the UK and in Europe. The highlight being winning second place intermediate heifer with Wyndford Atwood Grey at The European Show, Colmar in 2016. He was thrilled to see her become the Italian National Grand Champion at Cremona in October 2019.

Ben has enjoyed judging at many shows across the UK and in Europe with highlights including the Coloured Breed handling classes at the ABAB Calf Show, UK Dairy Expo, Emerald Expo, Celtic Show Case, The All Ireland Calf Show and the Winter Show, Drenthe, Holland.

Brian Weatherup Jr competed as a HYB member for fifteen years and has since gone on to judge at shows across the UK and Ireland. They include the Royal Highland Show, Great Yorkshire Show and Irish National Calf Show. He is a 3rd generation dairy farmer and helps to run the 220 head Parkend Holstein herd in Cowdenbeath, Fife. Showing highlights for the family include four Royal Highland Show Championships, Champion Heifer at the National Holstein Show and winning the Red and White Championship at UK Dairy Day. Brian is incredibly excited to be judging the Showmanship classes as he knows how important competing at the show is for any HYB member.    

Cerys Petrie, Events & National HYB Coordinator for Holstein UK, commented, “The annual All Breeds All Britain Calf Show brings together young dairy farmers from across the UK to compete, learn and network. The standard of competition is always exceptional and it’s really inspiring to see so many young calf handlers demonstrating sophisticated skills at such a young age.”  

A bipartisan immigration bill that will help farmers

There’s no doubt America’s major political parties are divided about immigration. But the House of Representatives will vote Wednesday on whether to advance a bipartisan bill—with support from dozens of both Democrats and Republicans—to make the system better for America’s farmers and farmworkers. With farmers still reeling from the trade war, they want a win so that they can keep feeding this country (not to mention much of the world).

The Farm Workforce Modernization Act (H.R. 5038) would finally end the dominance of illegal employment of foreign workers in agriculture. First, it allows illegal workers to apply for an indefinite legal status. Second, it reforms the H-2A guest worker program to allow farms to fill open positions legally.

These reforms will help American farms compete in food markets around the world and reduce illegal immigration and illegal employment. In an effort at real compromise, the bill also requires farmers to check their hires’ legal status through E-Verify.

The need for reform is clear. The Department of Labor estimates that about half of the farm workforce has no legal status at all—a share that grew quickly in the 1990s but has held steady for nearly two decades. Because such a substantial portion of their labor force work without proper documents—usually relying documents borrowed from legal friends and family—farmers face the constant threat of financial ruin if workers get caught.

Gebarten Acres, a New York dairy, lost workers it had employed for up to seven years when the federal government audited their papers last year. “We lost 20 people, half our workforce,” owner Greg Coller told a local paper. “It’s just been horrible. The timing is bad.” Alliance Dairies Group of Florida had the same situation, and when it eventually replaced them, the U.S. workers kept quitting after just a couple of weeks.

H.R. 5038 ends this uncertainty. It allows foreign farmworkers to apply for a five-year legal status renewable for as long as the workers remain in agriculture. If they pay a $1,000 fine, workers with at least 10 years farm work experience could receive legal permanent residence, allowing them to work anywhere, after four years. Other legalized workers would have to wait eight years to earn that path.

But the bill doesn’t repeat the mistake of the 1986 “amnesty”—which legalized farmworkers but didn’t adequately deal with how farmers would hire legal foreign workers in the future. H.R. 5038 would expand access to the H-2A program, which is what farmers use to hire foreign guest workers to fill open jobs. If we want illegal immigration to end, Congress has to guarantee farmers a better way to follow the law.

The H-2A program is already working to stop illegal employment. Regulatory improvements in the early 2000s made it easier for farmers to use. Farms went from filling about 50,000 jobs in 2005 with legal guest workers to nearly 260,000 in 2019.

This fivefold increase in guest workers corresponded with a dramatic drop in illegal immigration—mainly from Mexico. As more workers entered legally, fewer wanted to come illegally. Jose Bacilio, a Mexican avocado picker, told the Washington Post this year, “Most of my friends go with visas or they don’t go at all.” He explained that even though he hadn’t received one yet, he wouldn’t risk his chances by crossing illegally.

The problem is that the H-2A program only covers seasonal jobs. Farmers with year-round needs, like dairy and animal farms, are shut out. Naturally, this is where many of the recent border crossers are heading. The Farm Workforce Modernization Act would address this issue as well. It aims to create a year-round component to the H-2A program and a new streamlined permanent residence pathway for year-round farmworkers.

Unlike the normal H-2A program, the H-2A year-round program would have a cap, but the cap grows with the need, and the bill has procedures for setting aside the cap for emergencies.

The bill contains other reforms to the current H-2A program, streamlining applications and making the regulatory burden more bearable.

Critics say that the H-2A program displaces U.S. workers, but farms must offer every H-2A job to U.S. workers, and the Department of Labor recently found that U.S. workers take those jobs barely 6 percent of the time. Many of those hires showed up late—after the job started—and most ended up quitting shortly after.

Farms and downstream industries dependent on farms produce more than $1 trillion in goods and services every year. America needs to stop leaving this critical industry to deal with labor shortfalls without an immigration system that works. Rarely do substantial numbers of both parties agree on anything, but they agree on this.

Source:  thehill.com

Taking a closer look at Wisconsin dairy farm losses

Wisconsin dairy farms are going out of business at a record pace. Democratic Congressman Mark Pocan, of Madison, blames President Trump’s trade wars for the drop. Is he right?

PolitiFact Wisconsin with the Truth-O-Meter.

There’s no question that Wisconsin dairy farms are struggling, the state is losing nearly two a day.

Congressman Pocan recently tweeted, “Waging a trade war against WI farmers–forcing >1600 dairy farms to close.”

“Now, the numbers are roughly accurate,” said Eric Litke with PolitiFact Wisconsin. “The number of dairy farms in Wisconsin has dropped actually by a little more than that, nearly 2000. Since Trump took office.”

Let’s look at the numbers.

PolitiFact Wisconsin says the state had 9,288 dairy farms two weeks after President Trump took office in February 2017. As of this month, the number is 7,337.

But hold on. There’s more to this downward trend.

“Pocan is off base to blame this exclusively on Trump,” said Litke. “The trend that we’re looking at here and dates back well over a decade. Wisconsin has lost more than half of its dairy farms in the last 15 years alone.”

PolitiFact Wisconsin says there are multiple factors behind the decline – not just trade tensions.

“Low milk prices, historic levels of oversupply are changing consumer demand,” said Litke. “These were all dealing devastating blows to Wisconsin’s dairy farms, long before President Trump picked a fight with China.”

Congressman Pocan’s claim contains an element of truth but ignores critical facts that would give a different impression. PolitiFact Wisconsin rated his claim Mostly False.

Source: tmj4.com

Rescuers of dairy cow reunite with her, her calf

The first responders who rescued a cow that fell into a manure trench at the University of New Hampshire dairy barn last year were reunited with the cow Wednesday and got to meet her 1-week-old calf.

Ruby the cow fell into the trench just over a year ago.

“She got herself in a pretty good pickle,” said Mark Trabold, UNH dairy farm lead farmer.

Ruby was on her way to get milked when her hoof got caught on a grate. She lifted the grate and fell 8 feet into a trench full of manure. Farmers were worried she was going to drown.

“I got down there and I got straps underneath her,” Trabold said. “I was up to my shoulders in it.”

“We couldn’t get her out on our own, so I said, ‘I’m doing the wild thing. I’m calling 911,'” said Jon Whitehouse, UNH dairy manager.

Crews from Durham, Madbury and McGregor EMS responded, with some emergency workers jumping into the oxygen-deprived, methane-rich sludge. It was a dangerous and nearly three-hour effort.

“It was cold and very cramped quarters to work in,” said Durham firefighter Artie Boutin.

“We had to use a large hydraulic mechanical lift to actually lift her out of the pit while (Assistant Fire Chief) Jimmy Davis was whispering to her, telling her it was going to be OK,” said Durham Fire Chief David Emanuel.

“We’re a lot drier (now),” Davis said.

Ruby’s calf, born two days before the anniversary of her rescue, was named McGregor, in honor of the ambulance company.

“(Ruby) powered through and she’s been a great cow ever since, and we hope McGregor will be just like her mom,” Trabold said.

The manure pit covers are now chained down, farm officials said.

Source: WMUR

Milk Markets Continue to Slide Downward in Chicago Wednesday

Milk moved sharply lower after the 11 a.m. CME spot trade, but saw some most months rebound a bit. The day finished with December 6 cents lower to $19.37 on the Chicago Mercantile Exchange. January fell 21 to $18.19, February fell 7 to $17.56. Our first half is averaging at $17.32 per cwt. Class IV milk didn’t see as much of a move. December was unchanged at $16.74, January fell 4 to $16.99, and February fell 9 to $17.29 per cwt.

Dry whey down $0.01 at $0.3525. Three trades made, ranging from $0.3525 to $0.3550. Blocks down $0.0375 at $1.91. Barrels down $0.0850 at $1.8625. Butter up $0.01 at $1.95. Nonfat dry milk down $0.01 at $1.2525. Two trades were made at $1.2525.

Feed and Grain expenses continue to fall. December corn fell 5 ½ to $3.57 ¾, January soybeans fell 7 ¾ cents to $8.93 ½, and December soybean meal fell $3.60 to $293.30 per ton.

America’s Dairy Farmers Are Hurting. A Giant Merger Could Make Things Worse.

John Lamport limped across the barn that once housed dozens of his cows, gesturing toward the vacant stalls lining the perimeter.

During his career as a dairy farmer, Mr. Lamport had named every cow on his farm, memorizing the markings on their hides. He can still remember which cow stood in which stall.

“Her name was Elf,” he said, pointing to one stall, empty save for a paper coffee cup lying on its side.

But Mr. Lamport says there is another factor pushing down milk prices and harming farmers: the business practices of Dairy Farmers of America, a farmer-owned cooperative.

Now the biggest dairy co-op in the United States, with more than 14,000 members from New York to California, D.F.A. was established in 1998 to help farmers, like Mr. Lamport, market their raw milk to dairy processing companies, which prepare the milk for distribution to retailers.

Over the years, however, the co-op has also invested heavily in milk-processing operations, meaning that it buys some of the milk its own marketing arm sells. Those investments have created a conflict of interest, farmers and the lawyers who represent them say, since milk processors benefit from lower prices, while farmers benefit from higher ones.

Now, the co-op is in talks to acquire Dean Foods, the century-old milk processing company that sought bankruptcy protection in November. No agreement has been reached, but the prospect of D.F.A.’s taking control of Dean Foods, the co-op’s biggest customer, has raised new antitrust concerns.

Mr. Lamport is critical of the way that Dairy Farmers of America, the country’s biggest dairy cooperative, operates. 
Credit…Hilary Swift for The New York Times

“They can manipulate the milk price, and they can tell farmers what they’re going to get,” said Mr. Lamport, who now grows hemp for a living, drying the plants in barns where he used to keep his cows. “We have nowhere else to go.”

D.F.A. “ought to be doing one or the other” — market milk for farmers or invest in processing, said Peter Carstensen, a former antitrust lawyer with the Department of Justice who tracks the dairy industry. “The conflict of interest is going to result in harm, and the dairy farmer is going to have no good choices.”

Monica Massey, the executive vice president at D.F.A., said in a statement that it was “ridiculous” to claim that the co-op would suppress milk prices. “Our mission is to bring value to our farm families,” Ms. Massey said. “We do this by striving to pay a competitive price to our members and providing a secure home for their milk.”

D.F.A. invests in manufacturing facilities that “bring additional value to our farmer owners,” she added.

But this is not the first time the co-op has faced allegations of anticompetitive behavior. In 2018, D.F.A., which makes billions of dollars in annual revenue, paid $50 million to settle a long-running class-action lawsuit brought by farmers who claimed the co-op had colluded with Dean Foods to lower milk prices. A group of the plaintiffs dissented from that settlement, filing a separate suit against D.F.A. in federal court in Vermont.

That suit alleges that D.F.A. has engaged in a wide range of anticompetitive practices: making deals with other co-ops not to poach one another’s members, sharing milk-pricing information with those rivals to suppress payments to farmers, and signing restrictive supply contracts with processors like Dean Foods and Farmland that made it impossible for farmers outside the co-op to sell to those companies directly.

Ms. Massey said the allegations were “without merit.” In September, however, the judge in the Vermont case allowed the suit to move forward to a trial. Her decision said the plaintiffs had presented evidence from which a “rational jury could conclude that the D.F.A. management favored growth of its commercial operations and empire building over the interests of its farmer-members.”

In the last few years, the co-op has expanded its business partly by spending hundreds of millions of dollars to acquire milk processors like Guida’s, Cumberland Dairy, Oakhurst and Stremicks.

“When D.F.A. owns the plant, D.F.A. controls which farmers can sell to the plant and D.F.A. sets the price for the raw milk for its plant,” said Joel G. Beckman, a lawyer for the plaintiffs in the Vermont case. “D.F.A.’s acquisition of Dean’s processing plants would be the crown jewel of its empire-building, the death knell for independent farmers struggling to find a place to sell their milk.”

An expert witness for the plaintiffs, the Harvard Law School antitrust specialist Einer Elhauge, calculated that D.F.A.’s business practices have reduced the price of milk by nearly 80 cents per hundred pounds sold, costing dairy farmers a total of millions of dollars every month.

While those losses affect D.F.A. members and nonmembers alike, Mr. Lamport, a plaintiff in the case, said his milk profits declined soon after he joined the co-op in 2017. For decades, he had helped run an independent dairy operation on land farmed by his family since the 1930s, selling milk to the dairy processor Garelick Farms.

In 2001, a subsidiary of D.F.A., the Dairy Marketing Service, took over the transportation of milk from independent dairy farmers to Garelick plants, as part of an agreement the co-op had struck with Garelick’s new owner, Dean Foods. Suddenly, the checks Mr. Lamport’s family received every month were signed by the Dairy Marketing Service.

Then, in 2017, the Dairy Marketing Service informed Mr. Lamport that it would stop picking up his milk: If he wanted to continue selling to Garelick, he would have to join D.F.A. Feeling he had no other option, Mr. Lamport agreed to become a member. Soon, his monthly income decreased, as D.F.A. deducted marketing surcharges and other fees.

“We tried to cut back as much as possible to make ends meet,” Mr. Lamport said. “The milk price wasn’t high enough. We weren’t making money.”

In recent years, the crisis in the dairy industry has become severe enough that it has been blamed for a string of suicides by dairy farmers. One co-op, Agri-Mark, even began enclosing lists of suicide-prevention resources with the checks it sends to farmers twice a month.

At the same time, D.F.A. has earned steady profits. In 2017, the co-op moved into a new $30 million headquarters in Kansas City, Kan., featuring a fitness center, a regulation-size bocce court and a 25-foot milk-themed sculpture in the lobby.

The contrast between the luxurious amenities in Kansas City and the financial struggles of dairy farmers across the country has been “in the minds of a lot of producers,” said Darin Von Ruden, who runs the Wisconsin Farmers Union.

“It’s the whole attitude of economics in the U.S.,” Mr. Von Ruden said. “Management and people at the top continue to get larger pay raises.”

Still, not all farmers believe a merger between Dean Foods and D.F.A. would be harmful. Randy Koller, a longtime dairy farmer in Wisconsin, said the growth of the co-op promised market security. Because he belongs to D.F.A., Mr. Koller said, he never has to wonder, “Is someone going to pick up my milk tomorrow?”

It remains unclear whether D.F.A. will ultimately acquire Dean Foods. Ms. Massey, the vice president at D.F.A., said the co-op was evaluating the company’s assets to “ensure continued markets for our members’ milk” and “minimize overall disruption to the industry.” Since the bankruptcy announcement, the company’s bondholders have raised concerns about the lengthy antitrust investigation that might follow a proposed acquisition by D.F.A.

Whatever happens, Mr. Lamport plans to continue growing hemp on his farm in Hobart.

For years, a serious case of Lyme disease has restricted his mobility, making it difficult for him to spend the entire day working outdoors. In some ways, he said, the daily rhythm of hemp cultivation suits him better than dairy farming: The days are shorter, and the work is less strenuous.

Mr. Lamport still owns a group of calves that he eventually plans to sell. But the loss of his main herd weighs on him. He misses patting the cows and scratching them behind their ears.

“I thought I was going to be a dairy farmer for the rest of my life,” he said. “It’s all I ever knew.”

Source: nytimes.com

Clarksville Iowa Couple Opening a Bed and Breakfast in a Dairy Barn

A northeast Iowa dairy farm has entered a contest to help achieve a dream. New Day Dairy is becoming Iowa’s first bed and breakfast where you can “sleep with the cows.” They bill it as “Iowa’s Only Authentic Farm Stay.”

The New Day Dairy Guest Barn has three bedrooms, each with a private bathroom. From a common loft, guests can watch the dairy cows 24/7. The 150 cows are milked around the clock with a robot.

“There’s an automated milking system from AMS Galaxy USA,” said Dan Bolin, owner of New Day Dairy. “That automated milking system is open to the cows. They’re free to go and get milked anytime they chose.”

Dan and wife, Lynn, realized people want to know where their food comes from. Lynn grew up in a suburb of the Twin Cities in Minnesota.

“Our milk goes to a cheese plant in Luana, Iowa, and gets made into cream cheese and Swiss cheese,” said Lynn. “Now, people can come here and stay close to where their food, milk, yogurt, ice cream is produced every day.”

New Day Dairy will begin taking overnight visitors soon on Airbnb. In the meantime, the couple has entered a contest through the Farm Bureau for new businesses to win cash to boost their business.

To be able to vote on the competition, click here.

Source: WHOtv

Maryland to Cover 2020 Premiums for Farmers Participating in Federal Dairy Margin Coverage Program

The Maryland Department of Agriculture today announced that it will continue its popular cost-share program to cover premiums for dairy farmers participating in the USDA’s Dairy Margin Coverage (DMC) program. Enrollment for 2020 is open and runs through December 13. Farmers interested in participating in the DMC should visit their local USDA Farm Service Agency (FSA) office.

“Dairy is an important part of our state’s agriculture industry and our rural heritage,” said Governor Larry Hogan. “In February, I announced $1.5 million in my supplemental budget to provide much-needed assistance to our dairy farmers, who continue to struggle with high feed costs and inconsistent milk prices. Based on the success of this program is 2019, I am happy to announce that we will continue covering premiums through 2020.”

Earlier this year, Governor Hogan announced a state cost-share program that covers premium costs for farmers to enroll in the highest level of coverage in the DMC program (Tier I production at the $9.50 margin level). In its inaugural year, more than 80% of Maryland dairy farmers signed up for the DMC program. The department has worked closely with its federal partners to ensure minimal burden on farmers by making payments directly to USDA FSA on behalf of participating producers.

“It is no secret that these are hard times for our dairy farmers,” said Secretary Joe Bartenfelder. “I am thankful to Governor Hogan for his continued support of this important industry. I encourage all Maryland dairy farmers to visit their local FSA office to sign up for the DMC program before the December 13 deadline.”

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

Source: southernmarylandchronicle.com

A2 Milk wanted a change agent but was rattled by Hrdlicka’s speed

The disagreement stems from a difference in an element of strategy, or more particularly the board’s desire to push for higher margins, and Hrdlicka’s quest to fast-track investment and spending on marketing to amp up the company’s push into the US and China.

A2 Milk’s chairman, who is a former chief executive of Goodman Fielder, David Hearn, is keen to see earnings before interest tax and depreciation and amortisation [EBITDA] margins above 30 per cent as opposed to margins in the mid to high 20 per cent level.

Hearn said the board and Hrdlicka “were in agreement on the broad direction of travel (the company was taking)”.

It seems the board was looking for a change agent but was rattled by the speed of that change under Hrdlicka.

But Hearn was keen to see what he described as a balance between investment and margin.

Thus, it is expected the new chief executive, who will be appointed after an international search, will have a remit to tighten the focus on the timing of investment costs.

Hearn spent the morning speaking to investors who have strongly supported the company’s share price since the annual meeting in November when its guidance was for an EBITDA margin of between 31 per cent and 32 per cent in the first half of 2020 and slightly lower for the full year.

However, the market was clearly disturbed by the abrupt departure of Hrdlicka and sent the share price into a tailspin — it was down more than 6 per cent in mid-morning trade before retracing a third of that ground by lunch. Shares closed down almost 4 per cent at $13.97.

It seems the board was looking for a change agent but was rattled by the speed of that change under Hrdlicka.

Equally, shareholders were clearly disappointed with the full-year 2019 earnings presented by Hrdlicka in August, when she warned that the marketing ramp-up would result in EBITDA margins falling from 31.7 per cent in 2019 to about 28 per cent in 2020.

The share price tumbled 25 per cent and found its feet again after that forecast was revised at the annual meeting in November.

The chain of events suggests the board had taken control of the strategy over the past few months.

In Hearn’s statement, he thanked Hrdlicka for her contribution.

In that statement, Hrdlicka explained her departure as a logistical problem given her need to run a New Zealand company out of Australia and the increased rigours of travelling to both the US and China.

In a separate statement by Hrdlicka released late yesterday, she said: “There have been unforeseen changes in my personal circumstances in the very recent past and they must take priority at this time. At my 18 months at a2, the stock price is up 40 per cent and the business is running better than ever.”

The board is also keen to clear up any misconception that Hrdlicka’s decision to sell down what it refers to as her “transition shares”, awarded to her to compensate options she forfeited when she left Qantas, played into her departure.

She cashed out about $4 million worth of a2 stock last year partly to fund tax. The cash is said to have also gone towards paying for a house in Melbourne.

Some shareholders voiced concerns about this decision but it was supported on Monday by Hearn.

Her replacement is likely to continue with the strategy but execute it in a different way.

Source: smh.com.au

Christmas-obsessed farmer gives Jersey cows festive jumpers

A herd of Jersey cows have been given festive designs by a Christmas-obsessed farmer

A herd of Jersey cows are now sporting matching Christmas jumpers as part of a farmer’s move to promote the island’s agricultural history and culture.

Farmer Becky Houzé is one of the island’s biggest Christmas fans, and this year she couldn’t help but take the festive spirit up a notch on the farm.

Never before has her girls Carol, Holly, Mary, Noelle and Mariah Dairy had the chance to display their Christmas flare with passers-by.

The girls are making history as the first herd of Jersey cows to wear matching Christmas jumpers.

The highly-productive Jerseys are among the finest dairy breed in the world, with over 250 years of purity with Jersey milk used to produce products including butter, yoghurt, cheese and the famous Jersey ice cream.

Becky Houzém, who farms at Lodge Farm, said: “We love Christmas at the farm. This year we took the opportunity to ‘cast off’ an all new look for the girls to help get into the festive spirit by creating matching Christmas jumpers.

“It took a while to cow-ordinate the right design, but we think we’ve landed on a look worthy of the cream of the crop.

“With just 15 days to go until Santa comes to town, we’ve definitely got the Christmas feeling”.

Farmer Becky Houzé has taken her farm

Farmer Becky Houzé has taken her farm’s festive spirit up a notch

Tourism group Visit Jersey collaborated with Becky as part of the Chrismassy stunt, as the dairy breed are an ‘iconic part’ of the island’s history.

Louise Ashworth, head of marketing at Visit Jersey, said: “Jersey cows are an iconic part of the island’s history and culture and we’re excited to be celebrating this with Becky and her girls as we ‘moo-ve’ into the festive season”.

Source: farminguk.com

Milk Futures and Cash Dairy Tumble on Tuesday in Chicago

On the Chicago Mercantile Exchange Tuesday most milk futures and cash dairy prices were down significantly.  Class III milk markets had nowhere to go but down following the barrel cheese performance. Milk declined 8 cents in December and ranged from 16 to 24 cents softer in the first half of 2020. The first half 2020 market is offering producers $17.40 per cwt. Second half 2020 watched July fall 10 cents while the remaining months were a penny higher to 3 cents lower. Class IV milk softened 2-12 cents January through September 2020. First half Class IV 2020 prices are offering $17.60 per cwt. 

Dry whey was unchanged at $.3625 cents per pound. Five bids were offered, but no sales were recorded. Forty-pound blocks were down $.0225 at $1.9475 per pound. No sales were recorded. Barrels were down $.1325 at $1.9475 per pound. Two sales were recorded at $1.9775 and $2.00. Grade AA Butter was up $.0100 at $1.94 per pound. One sale was recorded at that price. Nonfat dry milk was down $.0050 at $1.2625 per pound. There were five offers and two bids, but no sales recorded.

Farm Bureau Asks for Swift USMCA Approval

The following statement may be attributed to American Farm Bureau Federation President Zippy Duvall:

“We urge members of Congress to swiftly approve the United States-Mexico-Canada Agreement. Agriculture is at a critical crossroads with the downturn in commodity prices, losses from natural disasters and the trade war. This is an opportunity for Congress not only to help U.S. farmers and ranchers turn the corner on trade, but also show that Washington can still get things done on a bipartisan basis.

“Ratification of the USMCA would build on the momentum of the U.S.-Japan agreement, which gave a major boost to American agricultural products in our fourth-largest market, and send a signal that the U.S. is back in business in the international marketplace.

“We urge Congress to work toward speedy approval. America’s farms and ranches are depending on you.”

USMCA BACKGROUND

Designed to replace the North American Free Trade Agreement, the USMCA builds on important trade relationships in North America.

  • The agreement is expected to increase U.S. ag exports by $2 billion and result in a $65 billion increase in gross domestic product.
  • The agreement will provide new market access for American dairy and poultry products while preserving the zero-tariff platform on all other ag products.
  • In particular, the agreement gives U.S. dairy products access to an additional 3.6% of Canada’s dairy market – even better than what was proposed in the Trans-Pacific Partnership trade agreement.
  • U.S. wheat will receive fairer treatment, thanks to Canada’s agreement to grade our wheat no less favorably than its own.
  • Mexico and the United States have also agreed that all grading standards for ag products will be non-discriminatory.
  • Additional provisions enhance science-based trading standards among the three nations as the basis for sanitary and phytosanitary measures for ag products, as well as progress in the area of geographic indications.
  • The agreement also includes measures that address cooperation, information sharing and other trade rules among the three nations related to agricultural biotechnology and gene editing.

New Recognition Award to Be Presented by World Dairy Expo; Nominate Today

World Dairy Expo® is accepting nominations for the 2020 Expo Recognition Awards now through February 1, 2020. New this year, WDE will be combining the former Dairyman and Dairy Woman of the Year Awards into one category, Dairy Producer(s) of the Year. Organizations, academic staff, producers and others involved in the dairy industry are encouraged to nominate individuals to recognize their outstanding work and dedication to the dairy industry.

2020 Expo Recognition Awards will be presented in the following categories:

Dairy Producer(s) of the Year: Presented to an active dairy producer whose primary source of income is derived from his or her dairy farm. This producer excels in efficient production and the breeding of quality dairy animals while incorporating progressive management practices. Award recipient’s community, government, marketing and World Dairy Expo involvement will also be considered.

Industry Person of the Year: This award is presented in recognition of an individual’s excellence in research, development, education, marketing, manufacturing or other fields, which are a part of an industry or institution that provides goods or services to the dairy industry. A resident of the United States, this award recipient may be an active dairy producer whose primary achievements are industry focused.

International Person of the Year: Living primarily outside of the United States, the individual who receives this award will be recognized for his or her contribution to international research, development, education, marketing, manufacturing or other fields, which are a part of an industry or institution that provides goods or services to the international dairy industry.

The nomination form, along with lists of past winners, is available at worlddairyexpo.com or by contacting the Expo office at 608-224-6455 or wde@wdexpo.com. The individuals selected to receive these prestigious awards will be recognized at Dinner with the Stars on Wednesday, September 30 during World Dairy Expo 2020 at the Alliant Energy Center in Madison, Wis.

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 62,000 people, from nearly 100 countries, will return to Madison, Wis. for the 54th annual event, September 29 through October 3, 2020, 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. Download the World Dairy Expo mobile event app, visit worlddairyexpo.com or follow WDE on Facebook, Twitter, Instagram or YouTube for more information.  

Is China Buying Up Worldwide Agriculture Interests? USDA Says Yes…

China’s need for agricultural resources and technology and the country’s considerable financial clout are driving rapid growth in Chinese investment in agriculture and food sectors abroad. The trend reflects the growing global ambitions of Chinese companies, and it is attracting the attention of business and government leaders around the world.

A 1964 poster promoting homegrown ag in China

According to Chinese investment statistics, overseas ventures in agriculture, forestry, and fisheries soared from $300 million in 2009 to $3.3 billion in 2016. But these totals understate the magnitude of Chinese agricultural-focused foreign assets because the statistics exclude the acquisition of food processing and trading companies classified in manufacturing and service sectors. A more complete count issued by China’s Ministry of Agriculture said the country had over 1,300 agricultural, forestry, and fisheries enterprises with registered overseas investments of $26 billion, at the end of 2016.

An initial wave of investments during 2004-12 was focused mainly on crop production, fishing ventures, and acquiring raw materials for the Chinese market. Most such ventures have targeted eastern Russia and neighboring Asian countries, attracted by relatively cheap, underutilized land. Chinese investments in Southeast Asia have focused on tropical crops like palm oil, cassava, sugar, fruit, and lumber, prompted by strong domestic demand and a regional free trade agreement with the Association of South East Asian Nations (ASEAN). Asia accounts for about half of China’s foreign investment in agriculture, forestry, and fishing.

More recently, some Chinese companies and officials have shifted the thrust of their strategy from farming overseas to acquiring established agribusiness companies based in Europe, North America, and Oceania. These include ChemChina’s $43-billion acquisition of Syngenta, a Swiss farm chemical and seed company, Shuanghui International’s purchase of U.S.-based Smithfield Foods, and China National Cereals, Oils and Foodstuffs Corporation’s (COFCO) purchase of two major agricultural trading companies—Noble Agri and Nidera. Chinese companies have also acquired companies or formed joint ventures in New Zealand and Australia, focused on meeting China’s growing demand for dairy, beef, and lamb.

A column chart showing Chinese direct overseas investments in agriculture, forestry, and fisheries from 2003 to 2016.

A pie chart showing regional shares of China’s overseas agricultural investment in 2014.

China’s Strategic Considerations as an Agricultural Importer

The surge of agricultural investment reflects an alignment of interests between Chinese companies and political leaders as China’s imports of agricultural products grow. The Ministry of Agriculture reported that agricultural imports exceeded $125 billion for 2017, up from $41 billion 10 years earlier. The growth reflects greater import volume of particular commodities like soybeans and pork as well as a broadening menu of imported commodities. Chinese consumers’ escalating demand for product variety—from staples like rice and wheat to premium products like olive oil and infant formula—stimulates commercial investments in land, brand names, and technology aimed at profiting from market growth. At the same time, the Chinese Government seeks to steer investors toward ventures that achieve national goals by offering various incentives, arranging deals, and setting up strategic plans.

As Chinese authorities have loosened national food self-sufficiency objectives, they have encouraged companies to gain greater control over the supply chain for imported agricultural products. Their “two markets, two kinds of resources” strategy calls for China’s demand for agricultural commodities to be met by a combination of domestic and foreign supplies. The strategy encourages Chinese companies to engage in each link of the supply chain for imported commodities to earn profits and gain influence over prices.

Lotus seeds and roots are a major crop

The strategy is reflected in encouragements to invest abroad by various documents and articles issued by Chinese leaders. For example, a series of annual “Number one documents” from China’s communist party authorities stating rural policy have contained increasingly specific strategies for investment. A general exhortation to invest in agriculture overseas, issued in 2007, was followed by an initial surge in overseas farming ventures. In 2010, authorities called for supportive policies to encourage investment abroad.

The 2014 document included a more specific mandate to create large grain-trading conglomerates, designed to give Chinese companies greater control over oilseed and grain imports. That was the same year COFCO acquired Nidera and Noble Agri, making COFCO one of the largest trading companies in the world based on value of assets. The 2015 document specifically called for policies to support facilities, equipment, and inputs for agricultural production in foreign countries. The 2017 document broadened the encouragement to include all types of agricultural conglomerates. The 2018 document repeated the general endorsement of overseas investment and instructions to create multinational grain-trading and agricultural conglomerates.

The incorporation of agricultural investment into broader geopolitical objectives is reflected by the prominence of “One Belt One Road,” a recent Chinese development strategy for connectivity and cooperation among Eurasian Countries, in policy directives on agricultural investment contained in 2015-18 rural policy documents. In these documents, Chinese officials emphasize the role of agricultural investment, technical assistance, and agricultural trade as a crucial part of the initiative that targets agrarian countries in Asia, Africa, and Eastern Europe for closer relations in trade and investment.

China’s aspiration to be a leader in international technical cooperation is reflected by an instruction to build agricultural technology parks overseas, issued in 2015. Early examples have been constructed in Tanzania and eastern Russia. Many projects associated with these initiatives appear to function both as foreign aid projects and as ventures giving Chinese companies access to agricultural raw materials.

Strategies for agricultural foreign investment announced in Chinese Communist Party Rural Policy Documents
Year Strategic statements related to foreign investment in agriculture
2007 Accelerate the agricultural foreign investment strategy.
2010 Set policies to support and encourage companies to invest abroad.
2014 Accelerate the agricultural foreign investment strategy.
Foster large, internationally competitive grain and oils enterprises.
2015 Promote foreign science and technology demonstration parks. Implement policies to support facilities, equipment, and inputs needed for foreign agricultural production.
2016 Strengthen agricultural investment with countries along the “One Belt One Road” path and bordering countries and regions.
Foster international grain traders and agricultural conglomerates.
2017 Support multinational agricultural businesses that are developing foreign production bases, processing, storage, and logistics focused on “One Belt One Road” objectives.
Foster large internationally competitive conglomerates.
2018 Actively support agricultural foreign investment.
Foster large, internationally competitive grain-trading and agricultural business conglomerates.
Note: Drawn from “Number one documents” issued by China’s central communist party committee that summarize rural policy priorities for the year. Translations from Chinese to English by USDA, Economic Research Service.

Many of China’s Investments Fall Short of Expectations

Rapid growth in investment does not necessarily mean success. Many of China’s overseas investments never reach their intended scale, and quite a few have been abandoned. While a handful of prominent ventures and acquisitions have benefited from bank loans or deals negotiated by political leaders, surveys by Chinese scholars have found that most overseas agricultural investors receive little Government assistance.

An agricultural park established in Laos by the Chongqing Municipal Government illustrates the disappointing results achieved by many projects. According to Chinese news media, the planned 5,000-hectare park was expected to produce flowers, aquaculture products, and other items, but it never grew beyond 50 hectares. While 200 Chongqing companies expressed interest in the Laotian park, only 4 actually invested. The most prominent business venture planned for the park in Laos intended to ship rice back to China.

A farmer plows in Yuxi, Yunnan China (Photo by Vmenkov)

However, rice seeds brought from Chongqing proved unsuited to the local climate and soils. After several years, a viable hybrid variety was developed, but the company discovered that costs of transporting rice to China would be prohibitive. The company concluded that additional investment in irrigation and roads needed to make the park viable could not be justified. By 2013, the original four investors had pulled out of the project.

More recent investments by some of China’s largest agribusiness companies have also encountered difficulties. China’s Bright Group sold Weetabix 5 years after acquiring it, reportedly due to disappointing sales of its products in China. Both Bright and COFCO discovered financial irregularities in companies they had acquired.

China’s investment strategies and policies, however, are responding to problems and new priorities. Many companies have shifted from overseas farming to acquisitions of existing companies and assets in marketing and processing. To support investment, Chinese Government organizations are setting up training courses, information clearinghouses, and subsidized insurance and are upgrading ports of entry and building overseas agricultural technology parks.

Responding to concerns voiced by many countries experiencing Chinese investments, Chinese Government leaders have advised companies investing overseas to give more attention to building goodwill in the host country. One Chinese company provided financial support to a dairy research institute in New Zealand and another cofounded a food safety initiative in Australia to allay concerns about Chinese investment in those countries.

Another strategy is to emphasize “win-win” projects that give poor farmers technical training and access to new markets. Mutual benefits of disseminating new techniques and opening new markets in exchange for greater raw material supplies is a theme of China’s agricultural investments in the regions of Asia and Africa. For example, a manufacturer of a traditional Chinese medicine derived from donkey skins sponsored an international conference on donkey breeding and farming as a strategy for fostering new suppliers in poor countries where raising the animals is still popular.

More Growth on the Horizon?

While China’s spending on foreign agricultural ventures appears large, it is modest compared with the country’s agricultural imports: In 2016, the country’s foreign agricultural investment equaled just 3 percent of the value of its agricultural imports that year. Moreover, agricultural investment has lagged behind other sectors in China’s foreign investment surge. Agriculture, forestry, and fishing accounted for about 1.7 percent of China’s foreign investment from 2012 to 2016. By comparison, agriculture’s share of China’s gross domestic product is about 9 percent.

More growth in Chinese investment appears to be forthcoming. Political leaders in China are endorsing agricultural investment as a core component of China’s One Belt, One Road initiative. More Chinese investments in Europe and North America could offer access to agricultural technology, processing, and logistical know-how to support China’s ambitions to modernize its domestic farming sector. China’s goals of gaining more control over supply chains for its imports and increasing its influence on global commodity prices could drive further investment in trading, logistics, and commodity markets.

China’s investments are likely to have impacts on global agricultural trade, just as a similar stream of Japanese investments did in earlier decades. Japanese companies played a role in Brazil’s emergence as a soybean exporter and China’s rise as an exporter of vegetables and poultry. Japanese agricultural trading companies have a prominent role in sourcing grains and oilseeds. There were concerns that Japan’s agricultural and food investment during the 1970s and ‘80s were a threat to U.S. agriculture. However, the United States remains the leading supplier of Japan’s agricultural imports, and Japan’s ownership of U.S. farmland and agribusiness remains modest.

China’s investments may influence patterns of trade at the margins, but resource scarcity, production capabilities, commodity prices, exchange rates, and other fundamentals will remain the dominant factors in the country’s growing agricultural imports. Nevertheless, China’s investments will create new opportunities and present new threats for particular industries, companies, and regions toward which they are targeted.

Source: southeastproduceweekly.com

Texas dairy farmer takes trade mission trip to Mexico

Relationships are just as important as the people making them

Larry Hancock, Texas dairy farmer and chairman of the U.S. Dairy Export Council (USDEC), traveled to Mexico, the United States’ number one importer of its dairy products, on a trade mission trip. Hancock was joined by four other U.S. dairy farmers to learn about the dairy industry in Mexico, observe how U.S. dairy products are being utilized in the country, and discuss how the two countries can continue working together to advance the dairy industry and demand for its products.

To Hancock, the trade mission was especially important for two specific reasons: to witness the importance of current and future relationships with Mexico and to see how the dairy industries in each country can learn from and help each other.

Relationships are just as important as the people making them.
Larry Hancock, Texas dairy farmer and chairman of the U.S. Dairy Export Council (USDEC), traveled to Mexico, the United States’ number one importer of its dairy products, on a trade mission trip. Hancock was joined by four other U.S. dairy farmers to learn about the dairy industry in Mexico, observe how U.S. dairy products are being utilized in the country, and discuss how the two countries can continue working together to advance the dairy industry and demand for its products.

Creating a “win-win” relationship is of utmost importance to Hancock, as dairy supply is very important to Mexico – a country that has a 60% dairy deficit.

“We don’t want to take their market; we want to help it grow. And what they can’t produce, we will supply,” Hancock said.

Annually, Mexico imports approximately $1.4 billion in U.S. dairy products, comprising of nearly 90% of its total dairy imports.

As part of the mission trip, USDEC arranged for U.S. dairy farmers to have opportunities to see their checkoff investment at work. One of those opportunities included touring grocery stores in Mexico to see how dairy products are marketed to consumers. Dairy products from the U.S. carry a sticker noting their origin location, aiming to increase the value of the product and meet the goal of greater demand for U.S. cheeses in Mexico. There is a difference in the cheeses, from the cheddars of the U.S. to the queso cheeses of Mexico.

And that difference, Hancock notes, is part of another grassroots checkoff effort: educating entry-level chefs on how to cook with cheddar cheeses. The goal is that more chefs will incorporate cheddar cheeses in restaurant recipes, thus showing consumers ways to incorporate cheddars in their meals at home. Increased usage of U.S. cheese in both restaurants and at the family table helps meet the goal of pushing demand for U.S. dairy products.

Hancock was adamant that U.S. dairy farmers need exports, stating that 95% of the population is outside of the U.S.; and in that population, the growing middle class desires more protein on their plate. To Hancock, that need for protein will be met with dairy and meat products.

Growing exports is obviously important, and in Hancock’s opinion, it needs to be done in a way that’s “not just dumping excess product at commodity price, but instead by selling higher quality products.”

In the end, Hancock comes back to the importance of relationships.

“Government leadership changes, but the dairy farmer suppliers do not,” Hancock said.

He believes in the value of farmer-members of the Mexican dairy industry meeting American dairy farmers. The two groups share many similarities, including concerns about trade, animal welfare activists, and milk alternatives. Discussions about those concerns and other industry issues provides opportunity for dairy farmers to find solutions together, thus helping to meet supply and demand goals.

From deliberations with Mexico dairy industry representatives, a joint statement was written and signed by both countries. The statement had 12 points, which included addressing shared concerns between the countries. Hancock summarized as the main goal being for the U.S. and Mexico to work together on dairy supply and demand.

Moving forward, Hancock reiterated the importance of trade missions. As a U.S. dairy industry leader, he sees his leadership efforts best spent driving U.S. dairy products “all the way to the consumer and doing it in a way that’s profitable.” And trade missions to tremendously valuable trade partners, like Mexico, fit the bill. Visit USDEC.org to learn more about the work being done to increase demand for U.S. dairy products.

Source: gilmermirror.com

A self-driving truck delivered butter from California to Pennsylvania in three days

A Silicon Valley startup has completed what appears to be the first commercial freight cross-country trip by an autonomous truck, which finished a 2,800-mile-run from Tulare, California to Quakertown, Pennsylvania for Land O’Lakes in under three days. The trip was smooth like butter, 40,000 pounds of it.

Plus.ai, a 3-year-old company in Cupertino, announced the milestone Tuesday. A safety driver was aboard the autonomous semi, ready to take the wheel if needed, along with a safety engineer who observed how things were going.

“We wanted to demonstrate the safety, reliability and maturity of our overall system,” said Shawn Kerrigan, co-founder and chief operating officer of the company, in an interview Monday. The company’s system uses cameras, radar and lidar — laser-based technology to help vehicles determine distance — and handled the different terrains and weather conditions such as rain and low visibility well, he said.

The truck, which traveled on interstates 15 and 70 right before Thanksgiving, had to take scheduled breaks but drove mostly autonomously. There were zero “disengagements,” or times the self-driving system had to be suspended because of a problem, Kerrigan said.

Plus.ai has been running freight every week for about a year, its COO said, but this is the first cross-country trip and partnership it has talked about publicly.

End of year is peak butter time, according to Land O’Lakes.

“To be able to address this peak demand with a fuel- and cost-effective freight transport solution will be tremendously valuable to our business,” said Yone Dewberry, the butter maker’s chief supply officer, in a statement.

How long will it be before self-driving trucks are delivering goods regularly across the nation’s highways? Kerrigan thinks it’s “a few years out.”

Dan Ives, managing director of equity research for Wedbush Securities, predicts there will be quite a few autonomous freight-delivery pilots in 2020 and 2021, with the beginning of a commercial rollout in 2022. Like other experts, he believes the trucking industry will be the first to adopt autonomous technology on a mass scale.

The timeline will depend on regulations, which vary state to state, he said.

About 10 to 15 companies nationwide are working on autonomous freight delivery, Ives said. That includes San Francisco-based self-driving truck startup Embark Trucks, which last year completed a five-day, 2,400-mile cross-country trip. But that truck carried no freight.

“When the (freight) trucks can go long distance, that’s when there will be significant ROI” on the autonomous technology, Ives said.

Source: mercurynews.com

Dairy facial eczema (FE) costs New Zealand Dairy Farmers $100k annually

FE can cost dairy farmers at least $100,000 each year in lost milk production.

Dairy facial eczema (FE) can cost farmers at least $100,000 each year in lost milk production, a recent study has found.

The Ministry for Primary Industries’ (MPI) Sustainable Farming Fund is supporting the Facial Eczema Action Group – made up of veterinarians, dairy farmers and rural professionals – to explore ways of raising awareness of FE so that more farmers take preventative action.

Many cows don’t show clinical signs of FE. As a result, farmers often don’t know why milk loss is happening and end up drying off their cows early.

“It’s hitting farmers hard in the pocket. They’re losing 0.14-0.35kg milk solids per cow per day,” said Emma Cuttance, a dairy veterinarian and head of Veterinary Enterprises Group (VetEnt) Research – which is leading the project. 

“We worked out that one of the herds in our study had lost $125,000 just in milk production.”i

She says zinc is currently the main way of treating FE. “But many farmers don’t administer enough to control the toxin that causes FE.”

Trial work in 2014, examining zinc concentrations in the blood of 1200 cattle from over 100 farms in the North Island, showed that about 70% of cattle did not have enough zinc to protect against FE.

“Blood testing is the best way to determine how badly affected the cows are if they have FE. However, getting farmers to do blood tests can be tricky because of the cost and time involved,” Cuttance said.

The project team brought in AgResearch to examine the wellbeing of cows affected by FE to see if there are other ways of identifying symptoms.

Steve Penno, director of investment programmes at MPI, said its support of the project recognised that FE was an issue that needed to be addressed.

“Whichever way you look at it, it’s in farmers’ best interests to proactively manage this disease, by improving cattle health and wellbeing and the bottom line.”

He says to help prevent the disease, farmers need to monitor the spore count on their own farm.

They are advised to start a management programme when spore counts trend upwards to 30,000 spores/g and continue until spore counts are 10,000 spores/g or below for at least three weeks. 

Blood testing is advised to check the effectiveness of zinc administration.

Source: ruralnewsgroup.co.nz

‘Coles has shown its true colours’: Calls to boycott Aussie supermarket over Milk Levy ‘low act’

Drought minister David Littleproud has savaged Coles for its failure to pass on a levy to farmers. Credit: AAP

Drought Minister David Littleproud has called for shoppers to boycott Coles over what he calls the supermarket’s “low act” of failing to pass on a levy for struggling dairy farmers.

Coles last week agreed to pay dairy cooperative Norco $5.25 million after the consumer watchdog accused the company of not fully passing on a 10-cent drought levy on milk to farmers.

Mr Littleproud called for shoppers to boycott the grocery giant until it put a 20-cent levy on all dairy products.

“They told their customers they were helping farmers, then tried keeping the money,” he said on Sunday.

“Coles has shown its true colours and needs to put things right.”

Mr Littleproud, the former agriculture minister, said he negotiated a deal with Coles to ensure the levy would flow to farmers.

“Coles should now lead the way and put at least 20 cents a litre right across its dairy range, not just on milk to show they really do care about dairy farmers,” he said.

“They owe it to dairy farmers and the public for failing to live up to their promises.”

The Australian Competition and Consumer Commission claims Coles did not raise its payment to Norco, which supplies the chain’s own-branded milk, by the 10 cents a litre it had claimed.

Coles disagreed with the ACCC’s decision but agreed to the payments in order to avoid “an unnecessary dispute” and help farmers.

Source: 7news.com.au

What can the financial sector learn from dairy farmers?

Nobody would travel with an out-of -date passport, so why should the world of finance be any different?

And yet, many major institutions are at great risk of acting on outdated information as they navigate through the increasing complexity of modern-day markets.

With so much out-of -date information out there, it is imperative to know where data comes from and where it ends up. But despite the increasing importance of pure data to a bank’s wellbeing, numerous companies are still struggling to become data-driven businesses. 

According to research that we carried out across 15 tier one and tier two US and European financial institutions, 60 per cent said that poor quality and inconsistent data was a major barrier. 

Given the era we operate in, this is a staggering finding.

What is even more staggering is that other industries which are far less complex than finance have proven that there is no need to carry the burden of poor data on their shoulders. 

For example, did you know that every cow in the UK has a passport? From this, dairy farmers know who the cow’s parents are, how many farms it has grazed on, which fields it has stood on, where its milk has been processed and by whom, even which batch of milk and cheese has ended up on each restaurant table. 

Why is this so important? Well, one only has to look at the global rise in veganism to understand how concerned people are with what they put into their bodies.

Perhaps the financial industry should be taking a leaf out of the dairy farmers’ book. 

The question is: could a financial institution be 100 per cent confident of where its data comes from? Do they really know what other data has been linked to the original source, and who has manipulated it? 

Banks are not just looking for the provision of a commodity like milk. The data affects their entire reputation as a business.

It is now paramount that a bank can see where the information has been. Data needs to be digitised, with no manual intervention on the content. The information also needs to arrive in the right format so that it can integrate easily into tools and workflows.

There is, however, no overnight utopia. Data will continue to be expensive, and with the market dominated by just a few firms, financial institutions need to ensure that they are getting maximum bang for their buck. 

Having survived successive waves of technology-fuelled disruption, firms are finally adapting to change.

The sheer scale of information may not be something that the markets can control, but the provenance and traceability of data, including where it comes from and where it end up, very much can be. 

After all, if a dairy industry can recognise the importance of customer health through in-depth data insights, so too can financial institutions. 

Source: cityam.com

Little Things Can Make Big Difference in Dairy Farming

On dairies like many other businesses there are an abundance of day-to-day activities. Unlike other businesses, dairy farms are a 7 day a week, 24 hour a day, 365 day a year operation. The major tasks like feeding, milking, scraping, and youngstock care take priority daily. Major project changes like building a new barn or upgrading the parlor take time for planning and execution in addition to the day-to-day. So, it is not surprising that the “little things” can get short changed from a time to time. Becoming more aware of and focusing some time on the “little things” can have a big impact on productivity and profitability.

One “little thing” to consider is feed push-ups. Cows eat more when fresh feed is available, after they return from milking and when feed is pushed up within reach. If feedbunks are overcrowded, the more timid animals may wait to eat, often when the feed has already formed that ridge from the more dominant cows eating, resulting in lower dry matter intake and lower production. The timing of feed push-ups may be just as important, if not more important than how many get done in a day. Scheduling work around the cows’ needs may be more effective. Increasing dry matter intake by one pound per cow per day can increase milk yield by about two pounds. So if one pound of dry matter costs $0.12 and a pound of milk is $0.18 then there is a three-found return on getting that one extra pound of intake. Of course this varies by stage of lactation, current ration, etc — but on average this is a pretty good return on investment.

One of those other “little things” to consider is timing. Whether it is consistent feed drop times or timing of synchronization programs and breeding, when things happen matters to the final results. How compliant are workers to the timing of tasks in the operation and is this “little thing” costing big dollars? Research presented by Dr. Katy Proudfoot at the 2019 Penn State Nutrition Conference showed that feed delays on alternate days caused increase stress in animals. Inaccurate timing of synchronization programs with breeding times can decrease conception rates and therefore pregnancy rates. Depending on the herd, this can be a big dollar impact. Spending time, rather than any more money and paying attention to the timing of tasks and adjusting when necessary can also result in a positive return on investment.

One last “little thing” is simply courtesy. Taking time to thank an employee for a job well done or to recognize effort for improvement when someone is continuing to struggle with a task can go a long way in impacting morale and productivity. When stressed – whether from a simple bad day or pressures from outside the farm, we often react more abruptly and omit those two important words that we teach our children – “please” and “thank you.” Again those little things can make that big difference.

While the day to day of operating a dairy can be intense at times, don’t overlook the impact that those many, many “little things” that may be neglected can have. Take time to make a list of “little things” for your dairy. Or better yet, enlist your trusted advisors to help with creating that list. Then develop a plan for monitoring how well those little things are getting done. If there is a gap between what is happening and what you would like to happen, then schedule time each week or each month to start narrowing those gaps by not losing sight of the “little things.” Take them one at a time and remember to continue to monitor to maintain your progress. After all, we have heard so many times that it’s the little things that make the biggest difference.

Source: extension.psu.edu

Mixed Markets Monday in Chicago

On the Chicago Mercantile Exchange milk futures closed mixed while the cash cheese market posted large seasonal losses Monday. Class III milk started the day with green on the overnight into the 11 am CME spot trade, but fell as our cheddar loads showed up to the market. But we didn’t move as low as we normally would expect with a 14 + cent move in Barrels. We finished the day mixed. December fell 4 to $19.51, January gained 2 to $18.64, and February was unchanged at $17.85. Class IV was unchanged nearby with December holding at $16.74, Jan fell 3 to $17.06, but February- April gained 5-7 cents with Feb at $17.42 per cwt.

Dry whey down $0.0050 at $0.3625. Three sales were made at $0.3625 and $0.37. Blocks unchanged at $1.97. Four trades were made ranging from $1.92 to $1.9850. Barrels down $0.1475 at $2.08. Three trades were made at that price. Butter up $0.0150 at $1.93. Three trades were made ranging from $1.9175 to $1.93. Nonfat dry milk unchanged at $1.2675.

Grain markets continue to see mixed trading with December corn falling ¾ of a cent to $3.65 ¾, November soybeans gained 7 ¾ cents to $8.97 ¼ , though December soybean meal didn’t follow soybeans, falling 70 cents to $296.70 per ton.

On-Farm Culture: The Smart Approach to Clinical Mastitis Treatment

Does every cow with mastitis need treated? Have you ever wondered if the treatment you are giving is effectively curing the case of clinical mastitis? What if her immune system has already cleared the infection? On-farm culturing allows for more informed decisions to be made regarding treatment and can help answer questions about whether to treat a quarter or not.

Mastitis is associated with the most frequent antibiotic use in dairy cows. One study found that the cost of treatment and discarded milk associated with clinical mastitis could exceed $350 per cow per year. Antibiotics are frequently used to treat clinical mastitis, however often antibiotics are either ineffective or not needed to treat the disease. Producers that use unnecessary antibiotics will lose profit and run the risk of developing antibiotic resistance on their farm.

Identifying the species of bacteria responsible for causing a mastitis infection can be beneficial in determining treatment options and reducing unnecessary antibiotic use. Management strategies can be changed to help prevent specific pathogen types in a herd. Staphylococcus aureus is an example of a pathogen that is transmitted through the parlor during milking. Wearing gloves, teat dipping, and milking infected cows last are some of the ways this pathogen can be prevented and controlled. Identifying the pathogen on a farm can help producers change management strategies to prevent additional cows from being infected. On-farm culture may also help a producer decide not to treat a cow. Results in one study found 10 to 40% of cultures from clinical mastitis showed no growth following culturing. Cultures that show no bacterial growth usually require no treatment because the immune system has already cleared the bacterial infection.

Traditionally, producers send milk samples into local laboratories for culture results. One downfall of laboratory testing is the time from milk submission until results are in a producers’ hands can take several days. This time lag associated with laboratory results contributes to producers making uneducated treatment decisions. Implementation of an on-farm culture program can help producers make proactive treatment decisions in a timelier manner. Submitting a sample for bacteriological culture can also be costly for a producer. On-farm culturing is often more cost-effective than obtaining laboratory results.

So how do you get started with an on-farm culture program? Penn State University has created a quad plate culturing system for dairy producers. Each quadrant of the plate can selectively grow different species of bacteria. Quadrant I MacConkey’s Agar (MAC) detects Gram-negative bacteria such as coliforms and non-coliforms. Quadrant II is Edwards Modified Agar (EMCO) and detects Streptococci bacteria. Quadrant III is Baird Parker Agar (BPA) which detects Staphylococci bacteria. Finally, quadrant IIII is Blood Agar (BA) capable of growing most types of bacteria and is used to confirm the results of other quadrants.

In order for a producer to get started culturing they will need the following supplies: sterile test tubes to collect aseptic milk samples, sterile swabs to plate milk onto agar plates, agar plates to grow bacteria, and an incubator that remains at a constant temperature to grow bacteria. Once a milk sample is aseptically taken it should be plated onto a quad plate. Plates should be incubated for 24 hours and then observed for preliminary bacterial growth, an additional 24 hours of incubation may be needed to collect final results. Penn State has also created a free user guide which can help producers identify bacterial growth on their plates. Farm personnel handling on-farm culture responsibilities should consult with their herd veterinarian in order to make appropriate treatment decisions for their herd based on culture results.

On-farm culture cannot identify every mastitis-causing bacterium on your farm. For example, Mycoplasma bovis is a microorganism that requires special media and conditions to grow, which can only be done in laboratories. On-farm culture is designed to help producers make more proactive treatment decisions regarding mastitis. Producers will be able to identify cows with no bacterial growth; these cows have self-cured the bacterial infection. Producers will also be able to identify Gram-negative pathogens which are often self-limiting or unresponsive to treatment, or Gram-positive pathogens which generally respond more effectively to antibiotic treatment, although some are not susceptible to antibiotics. To make a treatment decision udder health history of the cow should be examined and a consultation with a veterinarian should be set up to implement a treatment protocol.

Source: extension.psu.edu

Gay Lea Foods Announces Acquisition of Thornloe Cheese

Gay Lea Foods Co-operative Limited confirmed today that it has completed an agreement with EastGen to acquire the operations of Thornloe Cheese.

Located on the outskirts of Thornloe, Ontario, Thornloe Cheese has been a respected local producer of cheese and cheese curds in Northeastern Ontario for over 75 years. Today, the business employs approximately 30 people and is celebrated for its specialty cheeses, as well as for introducing the first butter and cheeses made with milk sourced from Dairy Farmers of Ontario (DFO) Verified Grass Fed program.

“Thornloe Cheese has a long and storied history in Northern Ontario and holds a special place in the hearts of Northern dairy farmers and consumers alike,” said Gay Lea Foods Chair, Rob Goodwill. “We are pleased to keep Thornloe Cheese in the hands of a wholly Canadian dairy farmer-owned co-operative and help keep Northeastern Ontario’s rich agricultural legacy alive.”

Thornloe Cheese operates one retail store and services a wide range of wholesale customers in Northern Ontario and Quebec.

QUICK FACTS

  • Thornloe, Ontario is approximately 520 km north of Toronto, in the New Liskeard/Temiskaming region.
  • Gay Lea Foods is a Canadian farmer-owned co-operative with members on more than 1,400 dairy farms across Ontario and Manitoba, more than 4,320 producer and investor shareholders

Could Supply Management Help Struggling US Dairy Farmers?

In August 2018, a small group of Wisconsin dairy farmers took a bus to Albany, N.Y., on a mission to save farms. It was almost four years into an unprecedented slump in milk prices, and in Wisconsin and elsewhere, farmers were struggling. They had cut costs, borrowed heavily, and were sinking deeper into debt. Many had given up altogether.

“Everyone was fired up,” says Josh Nett, part of the Wisconsin contingent at a national meeting of dairy farmers. “We wanted change.”

The change they sought was a nation-wide program to moderate the ups and downs of milk prices and avert the disastrous lows that were forcing some farmers out of business and imperiling the futures of many more. They wanted some form of supply management: a system that could curb the flood of milk that, in obedience to the laws of economics, drove prices down. Their aim was, in part, to guarantee farmers like Nett a decent livelihood.

“I don’t think anyone milking cows wants to be rich,” says Nett, whose farm has 257 cows. “But they certainly deserve a fair living.”

Supply management is not a new idea. It was the centerpiece of US farm policy during the New Deal and has variously benefitted cranberry growers, sugar beet farmers, and small tobacco growers. It was behind the government’s attempt in the 1980s to buy out thousands of dairy farmers. More recent proposals to regulate milk production have gained wide support but never enough to become law.

Farmers in Wisconsin, which has more dairy farms than any other state, are among the latest to embrace the idea. Beginning in 2018, the Wisconsin Farmers Union held meetings at which guests from Canada told how supply management had helped farmers there. For Wisconsin farmers, the time was ripe: From 2017 to 2018, the state had lost 590, or 6.5 percent, of its dairy farms. The WFU took its campaign, which it called “Dairy Together,” to farmers in other states, and this past September, to Washington.

Some farmers dislike the idea of federal intervention. “I’m a free-market man,” says Larry Pietrowski, who farms with 6,000 cows in Madera, Calif. “I think there’s a lot more the industry can do to get milk and milk products sold, to increase production.”

But the experience of the past five years has rattled farmers. It has given many a new sense of urgency and, advocates say, an openness to reform. The idea of supply management is already familiar to many: A growing number of dairy cooperatives, the farmer-owned associations that buy and process much US milk, have started their own internal supply management systems in an effort to keep production within their capacity.

Moreover, the campaign for supply management takes place against a backdrop of decline and consolidation that long predates the latest crisis. The US had more than 600,000 dairy farms in 1970; today, according to the most recent USDA figures, there are barely 37,000 left. Today’s dairy farmers are survivors. They want to protect their own farms and livelihoods but also the possibility of dairy farming for their children and grandchildren.

Josh Nett tends to his cows on his dairy farm in Fremont, Wisconsin in November, 2019. Photo by Richard Mertens

Nett is 45 years old and has devoted his life to taking care of cows. He knew it wouldn’t be easy—twice-a-day milking may be the most grueling schedule in agriculture—but nothing prepared him for the hardships and worries of recent years. He and his wife, Theresa, put off repairs, cut back on help, refinanced twice, and just barely survived. By last summer, when milk prices finally began to rise, he felt relieved, but little more. He says it will take years of good prices for farmers like him to recover.

“If we go through again what we went through in the past four or five years, none of us would make it,” he says.

It was late afternoon, and Nett, a stocky man with rubber boots and a green fleece cap pulled low, had more immediate concerns: changing the bedding for his heifers. The sun shone weakly over the fields and woodlots—the trees bare, the corn down to stubble, early snow lying in patches. Using a yellow skidder, he scraped the pens clean and spread bucket loads of fresh shavings. When he was done, he closed the gate and paused.

“I don’t have all the answers,” he says finally. “I don’t have all the answers for sure. I just know we need to do something different.” 

Source: modernfarmer.com

Milk Industry Shakeup Just Beginning with Dean’s Downfall

The following is from Alan Guebert, a freelance agricultural journalist from Illinois.

While many in the U.S. dairy sector focus on why the nation’s largest milk bottler, Dean Foods, filed for bankruptcy Nov. 12, the smart money—if there is any smart money left after four years of crushingly low milk prices—is focused on what’s next.

What’s next is what’s always next when your business is built on shrinking markets, declining margins and a relentless rise in production: more tough times.

Dean Foods’ crack-up, though, is so big and its market presence is so broad that what happens next to it will impact dairy farmers, processors, bankers and co-op members alike from Boston to Minneapolis. Maybe worse is that this sour mess was predictable, if not avoidable.

And, in fact, it was predicted by Peter Hardin, the publisher and editor of The Milkweed, a monthly dairy newspaper based in Brooklyn, Wis. On the front page of its Jan. 2019 edition, Hardin asked in blaring red ink, “Dean Foods: Preparing for Bankruptcy???”

As the three question marks attest, Hardin doesn’t do nuance. He does, however, do his homework.

In late 2018, Hardin came across a note in a Dean Foods’ quarterly Securities and Exchange Commission filing that reported the company had created something called the “Dean Foods Receivables Securitization Facility.” That “facility” allowed Dean to place “$450 million … beyond the reaches of the bankruptcy process.”

Why, Hardin wrote, would Dean Foods “cook up an Ivy League MBA scam to shaft suppliers and lenders by hiding up to $450 million in liquid assets” from “the bankruptcy process?”

The answer—94-year-old Dean Foods was headed into the tank—also pointed to the dairy sector’s overall failing health. After decades of rising competition, increased corporate consolidation and growing integration between dairy cooperatives and corporate processors, hardly anyone in the fluid milk business is able to make any money nowadays.

In fact, the market is bleeding itself white. From 1979 to 2017, U.S. fluid milk consumption dropped from 247 pounds per person to 149 pounds. Worse, sales of non-dairy “milks” like soy, almond, palm and oat ballooned 61 percent from 2013 to 2017.

Compounding those struggles are major food sellers like Walmart. In 2019, Walmart began to buy, bottle and sell its own milk. In the process, it began to eliminate regional milk bottlers and fluid milk-selling farmers from its supply chain.

That trend will continue. It won’t be long before American farmers become as commoditized as milk and chicken, since the food they’ll grow will be for specific farm-gate-to-dinner-plate giants like Walmart and Costco.

That streamlining already means fewer, freestanding processors like Dean and, in turn, even fewer milk marketing cooperatives and dairy farmers. In a way, Dean Foods is just the first, hulking victim.

Volunteering to be the second might be Dean’s largest fluid milk supplier, Dairy Farmers of America (DFA), who is now in “advanced discussions” to buy Dean. On the surface, DFA’s move makes sense. After all, Dean is the biggest milk buyer from DFA’s 14,000 farmer-members and still owes DFA $172.9 million for milk it bottled but never paid for.

But DFA and Dean have a checkered past. In 2007, both (and others) were sued by farmers who alleged antitrust violations between the co-ops and the processors. “Neither company admitted wrongdoing,” notes Food Dive, a website that tracks food news, “but Dean Foods settled for $140 million in 2011. DFA settled for $168 million in 2013.”

As such, dairy farmers from the East Coast to the Midwest should ask themselves two questions.

First, if Dean and DFA already have a failed past and a rocky current relationship, how will DFA make any money bottling and selling milk without lowering the price it pays for members’ milk it hopes to bottle?

Secondly, who exactly is DFA going to sell its members’ now-cheap milk to? Deans Foods’ biggest customer was Walmart. So, who’s left?

The answers aren’t pretty. Then again, spilled milk never is.

Source: farmers-exchange.net

The changing face of the New Zealand dairy farm

It wasn’t easy for Doug and Tracey Chappell to get onto their own land.

But their entry-level Pukeatua dairy farm means more than just what the 60 hectares and its relatively small 150 cow herd add to their long-term business plan.

“It’s our place and it’s something for our kids as well and they have even talked about running the farm in the future,” said Doug.

“It means a lot to us. I haven’t come from any farm ownership in my side of the family.”

The Chappells are among a rapidly shrinking number of the people that the Waikato and New Zealand dairying story is built on – a family owning and working on the land.

Hamilton’s main street boasts a statue depicting the archetypal farming family but new numbers from DairyNZ and LIC shows Waikato dairy farm owner-operator numbers have fallen by more than a quarter in just three years.

They are down 28 per cent, or 663 owner-operators since the 2016-17 season, to 1678 today. Nationwide, the trend is similar, down from 8503 owner-operators to 6507.

The two company’s annual ‘cow census’ dairy statistics showed showed that for a third year in a row, Waikato numbers had declined with 130 fewer in the 2018-19 season compared to the previous year.

The Chappells are sharemilking one farm while also milking on their first season on their nearby newly purchased 60 hectare stand-alone farm.

Tracey’s parents had owned a drystock farm before exiting the industry in the 1980s, said Doug, who is also Waikato Federated Farmers sharemilker’s chairman.

“For them, it’s awesome to see their daughter get into farm ownership and for me it’s a pretty big milestone. I know my Mum’s proud of what we have achieved and we’re proud to have it.”

But the trend doesn’t necessarily represent the demise of the patchwork of family farms clustered around rural communities across the region that’s been the Waikato staple for over a century.

AgFirst managing director James Allen, sees it as an evolution, rather than revolution, in the industry.

Rather than exiting the industry completely, he suspected the bulk of the decline was farm owners opting to step back from the day to day running of the farm.

“I think a lot of these farming families are making a conscious decision to say, ‘let’s keep the asset in the family’. So it’s still a traditional family farm, but rather than selling it, they might be outsourcing the management.

“In a sense, we have still got the traditional family farm. How they are being managed is possibly changing.”

This allowed farmers to retain their emotional tie to the land.

It would explain why the statistics showed a largely unchanged milk production output, increasing by just under 40,000 kilograms of milk solids from last year to 406.5 million. This was despite 8,615 fewer cows and the 3431 fewer hectares being used for dairying.

Herds are getting bigger, up from 335 cows in 2014-15 to 344 cows in 2018-19, along with farm sizes, up from 112ha-117ha across the same timeline.

Allen believed the trend would set to continue as more farm owners reached retirement age.

“I think we’ll see more continued leasing of land and sharemilking as people choose to retain their asset but divest the management of it.

“I think the family farm ownership is still very strong in the Waikato and while there’s a few corporate farms, there’s not that many. If anything there’s the family corporate who have a few farms and they are managing it as a business.”

Tougher environmental compliance and other costs was partially driving the trend. Owners were starting to make decisions whether to upgrade or retire and get out of dairy.

“There is a little bit of that going on. People are saying we have had enough for whatever reason and they are moving to things like maize or heifer grazing and to a smaller extent alternative land use.”

While many of the ‘A grade’ Waikato farms were still out of reach for those buyers, land that was further afield were not selling as quickly as it had in the past. This created opportunities for a pathway into farm ownership for first farm buyers, he said.

Countering that was the banks tightening up lending criteria.

“It’s a double edged sword. On one hand you’ve got some good opportunities, but you still have to make the numbers worth.”

Chappell believed farm ownership was still possible, but it took a lot of commitment and often required financial backing from another party.

“If you want it enough you will make the effort to save money and do what you want to do. If you set realistic goals you will get there.

“We had somebody who put money behind us to allow us to do it, otherwise we were probably looking in two or three years time as an option, but the opportunity came up sooner.”

Chappell said the farm’s small size gave them options. If they lost the sharemilking job, either he or Tracey could work off-farm and diversify the farm’s land use.

“It lessened our debt as well and reduced our risk but it meant it was our farm rather than having an equity partnership.”

 He believed that with many dairy farms on the market not selling, the farm owners chose to employ a share milker or contract milker instead.

“If there’s more sharemilking jobs, that’s awesome, it’s giving people opportunities.”

Source: stuff.co.nz

DeRuyter & Son Dairy accused of not following federal cleanup order

DeRuyter & Son Dairy has been hit with a complaint in federal court alleging it has failed to implement environmental safeguards required by a federal consent decree.

The 36-page complaint was filed Monday in U.S. District Court by two environmental groups, the local Community Association for the Restoration of the Environment and the Center for Food Safety.

Named in the complaint are DeRuyter & Son Dairy, its affiliate D&A Dairy and George and Margaret DeRuyter. The complaint alleges the dairy has yet to install double liners in seven animal manure storage ponds, has installed new storage ponds without any oversight and continues to over apply manure to fields as fertilizer.

The complaint requests the dairy be held in contempt for failing to abide by the decree and pay attorney and expert fees in the matter.

Yakima attorney Brendan Monahan, who is representing the dairy, said the DeRuyters have initiated new technology — a nitrification denitrification system — approved by the Environmental Protection Agency.

Denitrification removes nitrogen from discharge through a biochemical process and bacterial degradation.

The system meets requirements under the decree and has led to reductions in animal waste in storage ponds, irrigation water and soil, Monahan said.

“This should be a success story and it’s being characterized as a failure because of CARE’s arrogance to EPA science,” he said. “This is really disappointing.”

Environmental attorney Charlie Tebbutt said the dairy’s move violates the consent decree it has with the environmental groups and Lower Valley residents.

“They have a settlement agreement with EPA and they also have a settlement agreement with the citizens and they have not met compliance with the citizens’ agreement,” Tebbutt said.

EPA spokesman Bill Dunbar said his agency has approved the nitrification denitrification system instead of lining manure ponds.

“They’re in compliance,” Dunbar said.

DeRuyter & Son Dairy was one of a handful of dairies known as the “dairy cluster” that entered a federal consent decree after being sued by the environmental groups, which blamed the dairy operations for high nitrate concentrations in Lower Valley drinking water.

The dairies entered the decree after a study by the EPA linked dairy practices to groundwater contamination. Under the decree, the dairies agreed to install double synthetic liners in manure storage ponds to prevent waste from seeping into groundwater and follow a stricter nutrient management plan when applying animal manure to fields as fertilizer.

The lawsuit prompted the Groundwater Management Area, which spans the Lower Valley from below Union Gap to below Grandview. The GWMA involves federal, state and local officials, environmental groups and farmers seeking a plan to clean up Lower Valley groundwater.

The dairy cluster entered consent decrees with the environmental groups and the EPA. Monahan said the decrees are separate but overlap in requirements.

The complaint says the dairy repeatedly sought extensions of deadlines to install the liners from EPA but not the environmental groups. Under the decree, the dairy was to install liners at a rate of two ponds a year but has only completed work on two since the May 2015 decree.

“All of the other seven remain in the same state they were over five years ago, when the court ordered DeRuyter to line its lagoons,” the complaint said.

The environmental groups in the complaint took issue with the dairy for only seeking EPA approval for the nitrification denitrification system.

Monahan said the EPA approved the new technology as a substitute to liners, and the system utilizes the latest technology that promises to reduce nitrate in storage ponds by 80 percent.

“This is an extraordinary and innovative investment designed to protect the environment and EPA has approved it and CARE doesn’t like it,” he said. “CARE thinks it has better science than EPA.”

Tebbutt said the technology isn’t proven.

“That they chose to try a different technology does nothing to obviate their requirement to install synthetic liners in their lagoons that are proven to leak,” he said.

The complaint also alleges the dairy has failed to submit an updated plan to handle manure, a stipulation under the consent decree, continues to over apply manure to fields and has provided inaccurate information about the applications.

The complaint identified several fields alleged to have had hundreds of thousands of gallons of manure applied that exceeded safe thresholds the previous year.

“Under this administration, the dairy industry has run crying to EPA to give them some relief from the settlement agreement, but they can’t do that and haven’t done that with our consent decree,” Tebbutt said. “We have a federal court order which they agreed to.”

Monahan said he had yet to review the more than 1,000 pages of supplemental documents related to those allegations.

“We will roll up our sleeves and get into this,” he said.

Source:  yakimaherald.com

Production Cow Highlights the 2019 Holland Holstein Show

One hundred tonne New Moore Esmeralda 38 crowned a long career as an inspection cow with the general championship at the HHH show (photo: Lianna Kolff)

Eight years after winning the reserve heifers heifers at the HHH show, New Moore Esmeralda 38 now took the overall championship at the Holland Holstein Show in the IJsselhallen in Zwolle.  Swiss juge Stefan Widmer could not and did not want to ignore Esmeralda: “I love this cow.” Reserve Champion went to Double M Britny (Scientific B Defiant) exhibited Vof Jongsteins/J.H.H. Tijhuis, Hoogblokland, who had been named Intermediate Champion earlier in the day and had previously been the heifer champion in 2015.  Honourable Mention Grand Champion went to the 2nd place production cow Drouner Ajdh Cosmo Mountfield exhibited by Mts H. & C. Albring, Drouwenermond . Just like earlier this year, the Grand Champion at Red & White went to the Tijhuis family from Hooghalen at the NRM with Twente Dairies Apple Jose 1.

See here all results.

Fonterra lifts milk price payout after strong first quarter

Dairy giant Fonterra has announced an increased forecast Farmgate Milk Price of between $7.00-$7.60 per kgMS after a strong start to the 2020 financial year.

The co-op has been working on a new strategy since reporting a loss of $605 million for the 2019 financial year.

A focus on repaying debt has seen it sell assets, including iconic ice cream company Tip Top, and freeze salaries and bonuses for its highest-paid employees.

Fonterra Chairman John Monaghan said the co-op had continued to earn good prices for its milk and as a result has increased the mid-point of its forecast Farmgate Milk Price range by 25 cents to $7.30 per kgMS.

«The higher price reflects a global dairy market that is tipped slightly in favour of demand.

«Our New Zealand milk production is forecast to be up 0.5 percent on last year. Annual milk production in the other key global supply regions of the US and EU are both growing at less than 1 percent,» he said.

He said Global Dairy Trade prices had increased by about 6 percent since the previous forecast.

Whole milk powder (WMP) prices, a key driver of its milk price, have hit their highest level since December 2016.

«At this stage of the year, we have contracted a good proportion of our sales book and that gives us the confidence to increase the mid-point of our forecast Farmgate Milk Price range by 25 cents.

«Farmers will welcome what would be the fourth highest milk price in our history. It represents a $11.2 billion cash injection into our communities.»

Meanwhile Fonterra CEO Miles Hurrell said the co-op had made good progress moving to its new strategy and had had a strong first quarter.

He said there was still a focus on reducing further debt, so it was no more than 3.75 times earnings.

«This will require us to achieve a gross margin of $3 billion, further reduce operating expenditure, lower capital expenditure by $100 million to $500 million, and also divest some more assets.»

«I’m pleased to see this level of improvement. Our people are doing a great job of putting our strategy into action. There’s more to do but the wheels are definitely in motion.»

Source: newshub.co.nz

Ohio dairy farm analysis shows net losses

The 2018 dairy analysis work is in the books and is very reflective of the challenges Ohio’s dairy industry has faced since 2014. Several farms took a hard look at their numbers and chose to discontinue milking cows. Other farms joined the analysis program for the first time. 

In all, 20 farms — 19 conventional herds and one organic herd — participated in the 2018 Ohio Farm Business Analysis and Benchmarking program. These farms are located in 11 counties across Ohio, but this year are mainly concentrated in the northeast. 

Herd sizes were also very representative of Ohio farms, ranging from less than 50 cows to more than 1,000. Unfortunately, this year’s results aren’t surprising. 

With dairy farmers dealing with the fourth consecutive year of sustained low prices, the average net return for the 19 conventional dairy farms that completed an analysis for 2018 was a loss of $155 per cow. 

The good news is that the high 25% averaged a net return of $748 per cow (Table 1); which while positive, is also down from previous years. 

Factors for 19 conventional dairies chart

What did not change is the range between the lowest and the highest net returns per cow, nearly $3,000 in 2018. 

Ten of the 19 farms generated negative net returns per cow in 2018. These numbers continue to reinforce that the top third of dairy farms, while not exempt from financial challenges in down markets, continue to generate substantial positive net returns. 

If those returns are “enough,” depends on the size and debt position of the farm as well as the number of families the farm is supporting. 

2019 analysis work starts Jan. 1. Following a dismal start to 2019, milk prices have trended upward bringing needed cash into dairy farms’ checking accounts. As 2019 began, January and February milk prices looked alarmingly like a repeat of 2018 with Class III prices dipping under $14 per cwt. 

Only very strong producer price differentials kept the statistical uniform prices for January ($15.46) and February ($15.60) above 2018’s brutal levels ($14.84 and $14.01, respectively). Fortunately, dairy cow numbers started to decline nationally, one factor supporting improved milk prices. 

Improving milk prices does not lessen the farm’s need for accurate financial analysis numbers to both evaluate the farm’s position and progress, and to make informed management decisions. Plan to participate in financial analysis starting with your 2019 business year. 

Source: farmanddairy.com

Fonterra steps up but milk collection still falling

Fonterra Australia has stepped up its price for Australian suppliers while its milk collection in Australia continues to fall.

The step up on November 29 is the first since a new agreement that no longer guarantees a benchmark price for Fonterra’s Australian suppliers was signed with its farmer supplier representative group in August.

The step up of 5 cents per kilogram of butterfat and 10c/kg protein takes its average farmgate milk price to $6.95/kg of milk solids.

The company announced an opening price of $6.60/kg MS in May and stepped up in June to $6.80/kg MS to match other company’s opening prices.

The latest step up brings its pricing into line with Saputo, which lifted its price in October.

The Australian supplier representative group was restructured in November.

The restructure saw the last vestiges of the Bonlac Co-operative, which Fonterra took over in 2003, removed with the Bonlac Supply Company voting at its annual general meeting in November to merge BSC with Fonterra’s Supplier Forum to form a new Fonterra Australia Suppliers’ Council.

The BSC chair John Dalton became the chair of the new suppliers’ council.

Mr Dalton said the previous milk supply agency agreement, which had contained the benchmark price clause, had been due to finish this month but a new agreement was signed in August.

“We have been working on that for a couple of years for a suitable replacement between us and Fonterra,” he said.

The suppliers council was now using an independent consultant, Fresh Agenda, to independently validate the price.

“When we looked for a suitable alternative to ensure we are being treated and getting a fair price, we have settled on what we call external validation,” Mr Dalton said.

Fresh Agenda provided a report looking at Australian and international milk markets and milk trends to allow the council to check the price being offered by Fonterra.

Mr Dalton said new merged council would give farmers a closer working relationship with Fonterra that would help rebuild trust.

“It will take time for trust to return,” he said.

The new council will have a stronger regional structure.

There will be four regional councillors in each of the four regions (western, northern and eastern Victoria and Tasmania).

The currently elected Bonlac Supply Company regional directors – Stuart Griffin, Westbury, Vic; Paul Weller, Lockington, Vic; Alan Davenport, Derby, Tas; and Bruce Knowles, Tyrendarra, Vic, – will lead their region and sit on the executive, alongside one independent, Greg Bourke, and the chair.

Mr Dalton said farmers would notice a more region focus, which would give them greater access to their four representatives.

These representatives would link more closely with Fonterra’s Farm Source team to identify problems earlier and to get a faster resolution.

“There was one last week,” Mr Dalton said.

“A supplier in a region became aware of an issue, he then sent it to his region leader and it came to me and then I took it to Fonterra … and it was resolved within two days,” he said.

Mr Dalton said the new structure has received overwhelming support from farmers he had spoken with about it.

“I have been surprised at the overwhelming support – it’s, to be honest, blown me away,” he said.

​Milk collection falls

Fonterra continues to face declining milk collections in Australia.

In its latest Global Dairy Update, the company reported milk collections for October were down 13 per cent on the previous year, while year-to-date collections were down 18.9pc.

It said high on-farm input costs, decreased cow numbers, combined with intense competition for milk, would continue to impact its milk supply this season.

Fonterra’s collections continue to trail the overall Australian milk production decline.

Australia’s overall milk production was down 5.5pc for October compared with October 2018, while year-to-date production was down 5.8pc.

Victorian production overall was down 5.5pc in October but this masked major regional differences with Gippsland production up 2.3pc, while western Victoria was down 10.2pc and northern Victoria was down 9.1pc.

But the company said it was “addressing the significant challenges” in its Australian business.

In a business update released on Thursday, Fonterra chief executive officer Miles Hurrell said the Australian ingredients team “has continued to tackle their new norm of drought conditions and related increased competition for milk supply, by manufacturing and selling a more profitable product mix and reducing operating expenses”.

“Their hard work is helping balance out Australia’s lower milk volumes,” he said.

“The Australia Consumer business has delivered record market share in the chilled spreads category, and we are starting to see early signs of a turnaround in our New Zealand Consumer business.”

 

NZ farmgate milk price lifted

On Thursday, Fonterra increased its forecast NZ mid-point farmgate milk price by NZ$0.25 to $NZ7.30/kg MS.

“The higher price reflects a global dairy market that is tipped slightly in favour of demand,” Fonterra chairman John Monaghan said.

“Our New Zealand milk production is forecast to be up 0.5pc on last year.

“Annual milk production in the other key global supply regions of the US and EU are both growing at less than 1pc.

“On the demand side, Global Dairy Trade prices have increased by about 6pc since our previous forecast.”

The price would be the fourth highest milk price in Fonterra’s history.

The forecast range is now $NZ7-$NZ7.60/kg MS.

Mr Hurrell said the co-operative had made good progress moving to its new strategy and had had a strong first quarter.

The underlying financial performance of the business had improved, delivering a gross margin of $NZ740 million, up from $NZ646 million.

This was on the back of cutting operating expenditure by $NZ104 million and managing capital expenditure.

Mr Hurrell said normalised Earnings Before Interest and Tax (EBIT) was $NZ171 million, up $NZ145 million and reported EBIT was $NZ259 million, up $NZ233 million.

Free cash flow (cash generated from the business and available to reduce debt and pay interest and dividends) improved by $NZ595 million compared with last year.

Source: farmonline.com.au

Dairy Australia sees bright future, despite tough times

Despite the dairy industry facing some of its toughest times in recent years, Dairy Australia believes dairy still has a bright future in Australia.

Both DA’s chair Jeff Odgers and managing director David Nation spoke at the organisation’s annual general meeting in Gippsland on Friday of the challenges facing the industry.

«There is no doubt that 2018-19 was one of the toughest seasons in recent memory,» Mr Odgers said.

«Persistent dry conditions across all regions significantly impacted the cost of key inputs and farm profitability.

«National milk production decreased 5.7 per cent to 8.8 billion litres, but this decline could have been even more pronounced.

«I think farmers characteristically showed their resilience in the face of these challenges.»

Dr Nation said the past five years had been genuinely challenging for the dairy industry globally and in Australia.

«After the pricing shocks of a few years ago, it has now been followed up by drought across eastern Australia that’s affected the whole country,» he said.

«I am inspired by the way so many farmers have fought against the odds knowing how important it is to keep cows milking and finding a way to get through.»

Both Mr Odgers and Dr Nation pointed to Dairy Australia programs – many run through its regional development program network – to help farmers meet the challenges of drought and business viability.

«DA focused on having boots on the grounds where needed,» Mr Odgers said.

«Nearly two thirds of farmers have participated in at least one regional event in the last six months.»

Dr Nation said the response had included specific drought, tough times and feed shortage programs.

Both also spoke of DA’s flagship programs, many in collaboration with other organisations, as having delivered major gains, and promising more.

These included investments at DairyBio to improve animal and pasture genetics, Datagene and Dairy Feedbase.

Mr Odgers also spoke of the changed approach to marketing – with an emphasis on building trust with a key group of consumers.

«Building community trust is now more important than product promotion,» Mr Odgers said.

«Trust is built by providing credible and transparent information on all aspects of the supply chain.

«Our Dairy Matters campaign launched in April this year aims to connect with socially conscious consumers.

«Based on market research this campaign is also hitting the mark.»

Source: Farm Online

Top Dairy Industry News Stories from November 30th to December 6th 2019

Feature Article:

Top News Stories:

National Milk Producers Federation Agrees to Settle CWT Suit for $220 Million Over Herd Retirement Program

The National Milk Producers Federation (NMPF) announced Wednesday it has settled a class-action lawsuit brought by larger retailers and companies who purchased cheese and butter from members who participated in the Cooperative Working Together program for a whopping $220 million.

The herd retirement program was administered through NMPF’s Cooperatives Working Together (CWT) initiative between 2003-10. The program was created during a period of growing milk supplies and declining prices, culminating in historically low farmer milk prices in 2009. Under the herd retirement program, CWT announced invitations for dairy producers to submit bids to sell their dairy herds and cease milk production in an attempt to bring milk supply in closer balance with demand and help struggling dairy farmers.

In 2016, NMPF settled a class-action lawsuit brought on behalf of consumers for $52 million.   The suits were bought following CWT’s Herd Retirement Program, which was an industry-financed herd buyout program that operated between 2003 and 2010. Plaintiffs in both suits alleged the program unfairly raised dairy product prices, costing consumers and food retailers millions of dollars.

NMPF agreed to a settlement of $220 million in exchange for a release from all claims. Based on antitrust rules that mandate a tripling of any damages, that amount is less than 6% of the damages sought by plaintiffs, according to NMPF.

NMPF still faces a CWT case in Florida brought by Winn-Dixie Stores, Inc. But that case is much smaller in scope than the two previous cases.

World Dairy Expo Names Official Judges for 2020 Show

The eight individuals who will serve as official judges during the 2020 World Dairy Expo® Dairy Cattle Show, September 29 through October 3 in Madison, Wisconsin, have been selected. Responsible for the evaluation and placement of 2,300 of North America’s finest dairy cattle, these individuals were nominated and selected by WDE’s dairy cattle exhibitors.

The official judges for World Dairy Expo 2020 are as follows:

International Ayrshire Show
Michael Creek, Hagerstown, Md. 

International Brown Swiss Show
Lynn Harbaugh, Marion, Wis. 

International Guernsey Show
Molly Sloan, Columbus, Wis. 

International Holstein Show
Mike Berry, Albany, Ore. 

International Junior Holstein Show
Brandon Ferry, Hilbert, Wis. 

International Jersey Show
Chad Ryan, Fond du Lac, Wis. 

International Milking Shorthorn Show
Dean Dohle, Halfway, Mo. 

International Red & White Show
Pierre Boulet, Montmagny, Quebec, Canada 

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 62,000 people, from nearly 100 countries, will return to Madison, Wis. for the 54th annual event, September 29 through October 3, 2020, 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. Download the World Dairy Expo mobile event app, visit worlddairyexpo.com or follow WDE on Facebook, Twitter, Instagram or YouTube for more information.  

Official Top 100 TPI® Bulls – Sire Proof Central December 2019

Semen Status is Active, Limited or Foreign with a minimum of 80% traditional US reliability or 85% Genomic reliability for production and type and a minimum of 10 US daughters

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TPI is a trademark of Holstein Association USA Inc. 2019

How 3 Dairy Farmers Have Pulled Through Desperate Times

“If I hadn’t done this, I’d have gone out of business by now,” said dairy farmer Paul Fouts as he pointed to the new barn under construction on his property in central New York. It will help house the 150 new cows he recently bought.

When milk prices tanked a few years ago and he was in dire straits like so many other dairy farmers, he decided to throw everything he had at the farm.

He made big investments with borrowed money. He was already in debt and his bold move could have sunk him so deep he’d drown. Luckily, the best came of it—but even that isn’t a resounding success.

He’s able to keep up the payments on his loans and stay afloat. But he’s $2.5 million in debt and he doesn’t cherish hopes of a restful retirement; he’s 46 years old now. He’s not sure his children are interested in taking over the farm three generations have built. It’s been a tenuous livelihood at best, and a gargantuan stress at its worst.

In 2015, Fouts’s farm started operating at a loss. That was around the time milk prices dropped from about $25 to $15 per hundred pounds. For the next few years, prices stayed between $15 and $18. The major forces that kept the prices low were a sinking demand from China and a soaring supply from New Zealand and Europe, though numerous other factors impacted the industry in general.

Fouts’s move to go big represents an overall industry trend. The number of small farms (less than 500 cows) decreased by 16 percent from 2012 to 2017. The number of larger farms (more than 500 cows) increased by 15 percent over the same period.

“So basically, it’s a race to who is the cheapest producer and those that don’t want to race go out of business,” Fouts said. “And that’s sort of why people shop at Walmart and not by the mom and pop stores that you see around—same forces at play.”

“Not that anybody likes that,” Fouts said. “Just the way it’s been.”

He recalled the pinnacle of desperation, one day early in 2018 when Farm Credit representatives came to his house and sat down at his kitchen table with him. They told him he’d exhausted his credit, the only thing keeping him afloat. At the same time, a major disease began to spread among his cows.

“So you go over to the barn and deal with a bunch of sick cows that are dying around you, and you come home … [and] look at the big pile of bills on the table, wondering how you are going to pay them,” said Fouts. “There are a lot of sleepless nights.”

Then he’d be up at 2:30 a.m. as usual to tend to the cows. “[When I] walk across the road and open the barn door, those cows, you know, every bit of their life relies on me,” he said.

He enjoys the routine work; it’s peaceful. About 4 a.m. is his best time for thinking. For a long while, it was his time to mull over the big problems on the farm.

He told himself, “You are not going to hard-work your way through it; you are going to think your way through it.”

He planned it all out. He found weak points in the milking process and made plans to strengthen them. He decided to improve the barn—comfier cows would produce more milk. He decided to borrow against his life insurance to help pay the bills.

“The bank saw we were willing to put our own skin on the line and we are relatively successful and making it work,” he said. He got funding for his rescue plan. The 150 cows he bought cost about $1,400 each, or $210,000 total. The cows are 2 years old, the prime age for milk production. And he’s now milking his cows three times a day instead of two.

“Things are slowly getting better,” said Fouts. He said some of these things take time—such as waiting for milk production to increase because the cows are more comfortable in the new barn. The cows will also slowly get used to being milked more often and will start to produce more accordingly.

“You’re working with a biological system that you have to let nature take its course.” If nature takes the expected course, he will break even on milk sales next year.

The expansion plan cost him between $400,000 and $500,000 and the total debt on his book has risen to $2.5 million. He is paying back the supplier bills as soon as he can because they carry a high interest rate, 18 percent. He hasn’t paid back a dime on the loan against life insurance yet, which carries a rate of 8 percent.

His grandfather bought the family farm in 1937 during the Great Depression. It was “a rundown beat up farm,” and he saw his grandfather “throw a heck of a lot of hard work to build it up.”

“He quit school in the 8th grade to help support his family,” Fouts said. “He always pushed me to work hard at school so I didn’t grow up to be a ‘dummy like him.’ It was not until after he died that I came to appreciate how smart he was. All through my childhood, my grandparents, my parents, and I worked side by side. The farm always came first. You work until the work is done.”

‘Nothing Ventured, Nothing Gained’

Dylan Barber, 28, and his father own a small dairy farm 45 miles from Fouts, in Cortland, New York. During the milk-price crisis of the past few years, Barber has witnessed the closure of about six dairy farms within a 10-mile radius.

“In today’s dairy world, you’re pretty much left with, in my opinion, four decisions,” he said. “You can either get bigger; you can either go out of business; you can either basically, you know, make it work or deal with it until prices go up; or you can diversify and try to find some other streams of income to bring into the business.”

Barber chose the fourth option—diversification.

He was skimming through a magazine when he saw an article about the hemp industry. He was intrigued. The return on investment seemed fairly good, higher than milk and other cash crops like corn and soybeans. You can grow hemp for fiber, seed grains, or the cannabidiol (CBD) contained therein. Extracted CBD is used in some medicinal products to soothe pain.

CBD hemp yields the highest profit margin, so Barber decided to dabble in this market. In July, Barber became the first dairy farmer in his county to grow industrial hemp.

He started small, with 3 acres on his 400-acre farm dedicated to hemp. He hand-planted all 5,000 plants with the help of his family. “Being our first year, we decided that it didn’t really make sense to go out and invest in a mechanical planter,” said Barber, “We figured start out small and see how it goes.”

“Nothing ventured, nothing gained,” he said.

After planting, Barber only needs to walk the hemp field every day for an hour or so to make sure the plants are doing well. Then he goes back to the cows and works along with his father as before—he said dairy is still the number one priority for him. He barely breaks even on his dairy business. But he does break even.

In October, Barber harvested his hemp for the first time, and is currently working with his partner CSG Hemp to sell it.

New York Farm Bureau Senior Field Advisor Lindsay Wickham said “Hemp is the hot thing now, but has also been mostly disastrous in its infancy.”

“Probably a quarter of people growing it will make some money,” she said. Prices vary widely depending on growing methods and a number of other factors. She said some big players have not been honoring contracts.

Barber said he was aware of these risks and mitigated them through his contract with CSG Hemp, which did not require him to pay for the seeds upfront and includes incentives for CSG to get him a high profit. He’s hopeful that even if he has to sell at the low end of the hemp prices, he will still earn more than he would have with other crops. He expects each pound of dried hemp to be worth at least $20.

If he can reap $10,000 profit from the three acres, he said he will expand to eight acres next year and maybe invest in a mechanical planter.

He was born and raised on his family farm. “When I was three or four years old, I was always playing with farm toys. I always wanted to be a farmer.”

For him, it has always been rewarding to “wake up in the morning and step out the front door and you hear the birds chirping and the sun’s rising, and you just get that good, fresh … smell of air.”

Dairy farming in particular is close to his heart. “You got a cow that’s going to have a baby and you get to bring new life into the world and then you watch it grow and have a baby of its own,” he said. “We’re not rich in our pockets, but we’re rich in other ways. ”

Sell the Cows, Save the Farm

Some of Fouts’s new cows may once have belonged to Jordan Fleming. In September, Fleming and his father sold 70 cows, and the price they got was low. When they sold a bunch of cows in 2005, they got double the price they received this year.

For the past four years, the Flemings have been losing money on every pound of milk they’ve sold. It’s been the worst chapter in the story of the Fleming family farm. They started talking about selling the cows a little over a year ago, but it took them a while to finally do it.

“Neither one of us really wanted to get rid of the cows, but it was kind of one of those things you almost had to,” Fleming said.

Fleming believes he can do plenty of other, more profitable, things with his land. He now raises pigs and beef cows, and he grows sweet corn and pumpkins. He also decided to go back to school and pursue a degree in political science two years ago.

He has always had an interest in politics, and would like to find a job with the American Farm Bureau Federation or a similar organization. That would give him a stable off-farm income while allowing him to advocate for his industry.

He had left the farm he grew up on in 2005 to go to college, planning to go into forestry. But it only helped him realize farming is truly the life for him.

His favorite thing about being on the dairy farm is also the most challenging one—making a sick calf eat.

“They can’t talk to you, they can’t tell you what’s wrong with them,” said Fleming, and “it’s a challenge to figure out how to make them feel better, to do what is [needed] to keep them alive.” Over time, he’s learned to tell what’s wrong with a calf just by looking at it.

“You work for yourself really. And that’s always something you will always miss,” said Fleming, “You kind of make your own destiny really. You know, the harder you work, the better things will be—until you hit times like this.”

The USDA reported in September that milk prices rose above $19 per hundred pounds, the highest they’ve been since the major dip in 2015. It’s still not the $25 of better days, but it’s hope. The U.S.-Mexico-Canada Agreement (USMCA), which has been signed by the leaders of the three countries but has yet to be ratified in their legislatures, would open Canada’s dairy market wider to U.S. dairy producers.

While Canadian dairy producers have protested this aspect of USMCA, many U.S. dairy farmers are praying for it to go through.

Source: theepochtimes.com

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