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March 25, 2016 Subscribe to our weekly dairy or livestock email newsletter at CapitalPress.com/newsletters CapitalPress.com 9 Dairy Chobani to expand Idaho operations USDA predicts lean years ahead for dairy By CAROL RYAN DUMAS Capital Press Greek yogurt maker Cho- bani announced a major ex- pansion to its Twin Falls fa- cility Thursday, stating it will expand production capabili- ties to meet demand for new and existing products. The nearly $100 million initiative includes purchasing and converting three produc- tion lines for “Flip” products — the company’s fastest- growing yogurt line — and purchasing a new production line and a new bulk produc- tion line for foodservice op- portunities to drive further growth in schools, hotels, airlines and restaurants. The expansion also in- cludes the purchase of new equipment for new product categories, such as dips and yogurt drinks, and the launch of products to new interna- tional markets — including Mexico and Puerto Rico this summer. An expansion is under- way on the east side of the existing facility, and the company plans to break ground on a global research and development center and a separate office building later this year. “Building the largest yo- gurt manufacturing plant in the world and expanding it three years later is a really proud moment for us and an example of how right it was to pick Idaho as our second By CAROL RYAN DUMAS Capital Press Submitted photo Chobani’s yogurt plant in Twin Falls, Idaho. On March 17 the company announced a $100 million expansion to the facility. home,” Chobani Chairman and CEO Hamdi Ulukaya, said in Thursday’s press re- lease. The company’s success in Idaho and New York is an example of the power and strength of U.S. manufactur- ing and a signal of the mo- mentum of the food move- ment Chobani started aimed at “better food for more peo- ple,” he said. Chobani began opera- tions in Twin Falls in De- cember 2012 with a nearly 1 million- square-foot plant — the largest yogurt manufac- turing facility in the world — at an initial investment of more than $450 million. The company’s pres- ence in Idaho has served as a catalyst for new jobs and expanded food processing in the region, according to state and local officials. “The kind of success that Chobani is experiencing in the Magic Valley is setting a great example of region- al collaboration between employers and community leaders throughout Idaho,” Gov. Butch Otter said in a statement about the expan- sion. “And it has economic-de- velopment leaders all over America standing up and taking notice of what Idaho has to offer,” he said. In addition to expansion plans in Twin Falls, the company is also exploring plans to expand its original plant in New Berlin, N.Y. The company also operates a Greek yogurt plant in South Victoria, Australia. The company stated it receives up to 4 million pounds of fresh milk dai- ly from local farms in New York and Idaho and employs more than 2,000 people worldwide. CME dairy prices see ups and downs; milk output up By LEE MIELKE For the Capital Press C ME cash prices saw some ups and downs in the St. Patrick’s Day Week as traders anticipated Friday afternoon’s February Milk Production report. Cheddar block cheese closed Friday morning at $1.49 per pound, down a penny on the week and a nickel below a year ago. The barrels lost 5 cents, then jumped 8 cents Fri- day and closed at $1.50, up 3 cents on the week and 2 cents below a year ago. Only one car of block was sold on the week at the CME and four of barrel. The blocks were unchanged Monday as traders awaited Tuesday afternoon’s February Cold Storage report, and they were unchanged Tuesday. The barrels slipped three-quarters Monday and lost 2 1/4 cents Tuesday, dipping to $1.47. Dairy Market News reports that Midwest cheese makers are seeing plenty of milk and many are near full capaci- ty. Some spot milk loads are available at $1.50 to $3.00 un- Dairy Markets Lee Mielke der Class but “domestic retail cheese demand continues to be a good draw. Sales into food service and mozzarella for piz- za have also been respectable.” Western cheese output re- mains steady to higher as milk intakes increase seasonally. “Demand is still good from food service and retail but club stores and other large retailers have slowed cheese orders somewhat and are taking a wait-and-see approach to the market,” according to DMN. Cash butter dipped to $1.9250 per pound last Tues- day, the lowest price since July, 2015, then rebounded some, and closed Friday at $1.95, down 3 3/4-cents on the week but still 27 cents above a year ago, with eight cars ex- changing hands on the week. The Monday butter market was unchanged but it inched up three-quarters Tuesday, to $1.9575, with 10 cars trading hands and a bid at that price going unilled. Butter production is active throughout the Central re- gion, according to DMN. Spot cream offers are readily avail- able and interest is steady to light, with inventories “steady to building,” while Western butter makers are seeing some of the seasonal demand ebb. Cash Grade A nonfat dry milk closed the week at 73 cents per pound, down 4 cents and 25 1/2-cents below a year ago. Thirteen cars were traded on the week. The cash price inched up a half-cent Monday and a quarter-cent Tuesday, to 73 3/4-cents per pound. Milk output up U.S. milk production in February in the top 23 states totaled 15.8 billion pounds, up 4.6 percent from February 2015, according to prelim- inary data in USDA’s latest Milk Production report. But, when adjusting for the addi- tional day due to leap year, output was up just 1 percent, though that was more than many expected and the larg- est percent gain since August 2015. Output in the 50 states to- taled 16.9 billion pounds, also up 1 percent from 2015, fac- toring in leap day. Revisions lowered the original 23-state January estimate by 13 mil- lion pounds, to 16.6 billion, up just 0.2 percent from 2015. U.S. dairymen have watched their proit mar- gins fade along with the re- cord-high milk prices of 2014, and it doesn’t appear there’ll be relief anytime soon. USDA Economic Research Service is projecting lean times ahead and a downward trend in milk prices until 2019 in its agricultural projections for the next decade. The nationwide January all- milk price was down almost $8 per hundredweight from an average near $24 in 2014. At $16.10, the January all-milk price was almost $3 per hun- dredweight above operating cost but nearly $6 below total cost of production. The average all-milk price is projected at $16.40 per hun- dredweight in 2016, continu- ing downward to $16.15 by 2018 as lower feed costs en- courage increased production. While U.S. cow numbers are projected to decrease by about 5,000 head in 2016 and then hold steady through 2020, output per cow is expected to increase through the projection period — rising 4,525 pounds per cow by 2025. Continued technological and genetic developments as well as eficiency gains result- ing from consolidation in the sector will support continued increases in per-cow produc- tion, ERS reported. Increasing milk prices after 2018 — which are projected to rise faster than the general inlation rate, largely on the strength of export gains — and only moderate increases in feed costs are expected to pro- vide economic incentive for continued expansion after the lean years. The agency also expects domestic dairy demand to grow at a strong pace, with commercial use rising faster Don Jenkins/Capital Press Dairy cows stand in a barn in northwestern Washington. USDA Economic Research Service is projecting lean times ahead and a downward trend in milk prices until 2019 in its agricultural projections for the next decade. than the growth in U.S. popu- lation over the next decade. Greater consumption of prepared foods and increased eating away from home will drive cheese demand, and but- ter demand is expected to grow — partly due to the phase-out of trans fats. The per-capita decline in domestic luid-milk consumption, however, is ex- pected to continue. In addition to overall strong domestic demand, the agency is projecting better demand abroad. U.S. dairy exports are pro- jected to recover and expand over the next decade after de- clining 3.6 billion pounds in 2015. That decline was mostly due to lower demand from Chi- na and greater competition from the EU as a result of the Russian trade ban, ERS reported. Exports of products high in nonfat milk solids, such as nonfat dry milk, will lead the recovery and expansion. Pro- duction increases in other ma- jor dairy exporting countries are expected to lag global im- port demand, and U.S. exports are projected to reach record levels, rising to 13.6 billion pounds by 2025. Educating the next generation is very important to Capital Press. We extend a sincere “Thank You!” to all the valued sponsors who have contributed to our NIE program. It’s your continued support that will help educate the next generation on the importance of agriculture. Here’s what Ag teachers think of our NIE Program. “Being able to read the latest in production Ag makes the content covered in this class so much more real. 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