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August 12, 2016 Subscribe to our weekly dairy or livestock email newsletter at CapitalPress.com/newsletters CapitalPress.com 11 Dairy Washington ines two dairies for pollution Manure drains into watershed By DON JENKINS Capital Press Two neighboring What- com County dairies in Ever- son, Wash., have been ined $4,000 apiece by the state Department of Agriculture for discharging manure into a tributary of the Sumas River, causing fecal coliform levels to exceed water quality stan- dards for nine days in March. The penalties imposed on the Art Vander Waal Dairy and Marmel Dairy are the irst levied this year by WSDA against dairies for violating the state’s Water Pollution Control Act. Although the violations occurred in the same area and at the same time, they had dif- ferent causes. A WSDA dairy inspector on March 23 detected during routine water sampling in Su- mas River tributaries bacteria levels that greatly exceeded state standards. Further investigation found that rain fell shortly after manure was spread on a ield at the Vander Waal dairy, according to WSDA. Manure-contaminated wa- ter lowed into a ditch that drains into the Bone Creek, which runs into the Sumas River. The dairy built a berm to block the discharge into the ditch, but manure-laced water continued to pool in the ield, according to WSDA. Over the next nine days, WSDA collected water sam- ples upstream and down- stream. Enough manure entered the Bone Creek wa- tershed to keep fecal coli- form bacteria levels elevated until March 31, according to WSDA. Also on March 23, a valve was left open on a line ap- plying manure at the Marmel Dairy, causing contaminated run-off into Clearbrook Road ditch, according to WSDA. The ditch drains into Bone Creek. The dairy worked that eve- ning and into the following day to minimize the discharge by diverting and pumping ma- nure from the ditch, according to WSDA. WSDA continued to collect water samples and detect pol- lution from the discharge until March 31. Efforts to reach the dairies were unsuccessful. In both cases, WSDA chose to issue the standard penalty for a irst-time violation. The Sumas River lows into Canada and drains into the Fraser River. Idaho organic dairies growing rapidly By JOHN O’CONNELL Capital Press Capital Press ile Cows feed at a Wendell, Idaho, dairy. Dairy farmers who bought higher coverage in the federal Margin Protection Program will receive nearly $11.2 million in indemnity payments for the May/June program period, USDA Farm Service Agency announced. Low milk prices trigger dairy payments By CAROL RYAN DUMAS Capital Press Dairy farmers who bought higher coverage in the federal Margin Protection Program will receive nearly $11.2 mil- lion in indemnity payments for the May/June program period, USDA Farm Service Agency announced. Established by the 2014 Farm Bill, the program pays participating farmers when the margin between a calcu- lated national milk price and a calculated national feed cost falls below $4 per hundred- weight of milk. But produc- ers can purchase additional coverage to insure a higher margin, up to $8 per hundred- weight. With the all-milk price av- eraging $14.65 per hundred- weight for May/June and feed costs averaging $8.89, the two-month margin hit $5.76, down $1.39 from March/ April. Dairy producers who en- rolled at the $6 to $8 mar- gin coverage — 4,852 of the 25,663 participating — will receive payments this month, FSA stated. Most enrolled in the pro- gram didn’t buy additional coverage, with 19,864 partic- ipating at the subsidized $4 level, which requires a $100 administrative fee but no pre- miums. In announcing the larg- est payout since the program began, Agriculture Secretary Tom Vilsack characterized the MPP program as “a robust, comprehensive farm safety net” that helps provide dairy families with “greater peace of mind during tough times.” California dairy producers beg to differ, said Lynne Mc- Bride, executive director of California Dairy Campaign. Robust and comprehensive was certainly not the case in 2015 and again in 2016, and it shows in program participa- tion, she said. California dairymen’s par- ticipation in the program’s buy-up coverage plummeted between 2015 and 2016, drop- ping 90 percent in the number of dairies and 85 percent in the amount of milk. Of the 33 billion pounds of Califor- nia production enrolled in the program this year, only 1 bil- lion pounds is enrolled in buy- up coverage, she said. Just 18 of the 1,143 dairy operations in California that signed up for the program will receive an indemnity payment for the May/June period for a total of $305,167, FSA report- ed. “That shows the program is not working for the vast majority of dairymen in the state,” she said. Only 38 California produc- ers signed up for additional coverage in 2016, down from 318 in 2015. It shows pro- ducers aren’t willing to pay a premium because they don’t expect the program to pay a beneit, she said. “California dairy produc- ers have a complete lack of conidence in the program,” she said. The national all-milk price and feed cost don’t relect reality in California. If the national margin reached the $4 base coverage level, the situation would be beyond catastrophic in California, she said. But California doesn’t have the corner on waning conidence in the program, judging by enrollment. While producer participation in- creased by 915 operations in 2016, the number of opera- tions purchasing additional coverage dropped by more than 8,000 from 2015. Last year, producers paid about $73 million in fees and premiums, and only about $700,000 was paid out to cov- er lost margins, FSA reported. National Farmers Union formed an emergency com- mittee on dairy prices this spring to consider, among other things, calling on USDA to suspend the program and refund the millions of dollars dairy farmers paid into the program. NFU President Roger Johnson issued a statement Aug. 4, saying the program has not operated effectively because the formula doesn’t accurately relect cost of pro- duction. DIETRICH, Idaho — Ben Pulsipher was managing a 2,000-cow conventional dairy in Raft River when he decided it was time to start his own op- eration. With conventional dairies struggling to cope with low milk prices, Pulsipher reasoned the organic price premium would make it economical for him to start with a small herd and grad- ually grow. A few months since entering the organic industry, Pulsipher said his contract still justiies the extra hassle, but he’s be- gun to worry too many other Idaho producers have reached the same conclusion and may be gradually looding the niche market. He and his partner, Evan Israelson, sell milk to Sorrento Lactalis in Nampa for organic string cheese production, oper- ating as Anhder Organic Fam- ily Dairy LLC. They bought their dairy, which switched to organic production under the previous owner last No- vember, in May and milk 200 cows. “We couldn’t afford to start off a 2,000-cow dairy, or even a 500-cow dairy. In order to compete in the conventional market you’ve got to be big,” Pulsipher said. While organic certiication Courtesy of Ben Pulsipher Dairy cows graze at the new organic dairy in Dietrich, Idaho, oper- ated by Ben Pulsipher and Evan Israelson. Idaho has experienced strong growth in the organic dairy sector lately. has provided the partners sta- bility in an otherwise tumul- tuous dairy sector, organic production comes with its own challenges — and higher input costs. Ground must be three years removed from conven- tional production and livestock must be transitioned for a year to be certiied. Organic hay and forage is costly. Pulsipher said the cows must be allowed to graze, which tends to decrease milk production. Furthermore, there’s more paperwork, and producers face a yearly audit. Nonetheless, Idaho State Department of Agriculture Organic Program Manager Jo- hanna Phillips said growth in the category has been so rapid lately, the state started tracking the number of inquiries from producers seeking to enter the organic sector in 2015. That year, ISDA ielded 120 inqui- ries. This year, the agency has already handled 115 inquiries. Phillips said Idaho’s to- tal certiied organic acreage jumped nearly 15 percent from about 185,600 acres in 2014 to 213,000 acres in 2015. Organic hay acres increased about 33 percent in 2015 to nearly 40,000 acres. ISDA also been busy certify- ing organic dairies, adding 11 in 2014, 16 in 2015, and 20 thus far in 2016. The number of organic milk cows rose from 5,967 in 2014 to 18,357 in 2015. Phillips said ISDA’s organ- ic program has “not previously had this level of interest,” but she noted Idaho still has a small percentage of organic acreage relative to other states. “I would say there’s certain- ly room for growth in Idaho and the consumer demand continues to outstrip production, and that bodes well for the market,” Phil- lips said. Dairy prices start August with a bang By LEE MIELKE For the Capital Press D airy prices sizzled the irst week of August, with cheese advancing the sixth consecutive week. The Cheddar blocks closed Friday at $1.8150 per pound, up 8 1/4-cents on the week, 6 1/2-cents above a year ago, and the highest since Nov. 18, 2014. The barrels closed at $1.88, up 10 1/2-cents on the week, 16 1/4-cents above a year ago, and the highest price since November 2014 as well. Nine cars of block traded hands on the week at the CME and 20 of barrel. The cheese was unchanged Monday, with no activity, but the blocks lost a penny Tues- day on an offer and slipped to $1.8050 per pound. The barrels held at $1.88 Tuesday, 7 1/2-cents above the blocks. HighGround Dairy’s Aug. 1 “Morning Huddle” stated, “Though broader fundamen- tals are bearish, extreme heat and seasonal demand will likely keep cheese prices supported through the end of summer.” Dairy Market News re- ports that cheese production was steady to slightly lower Dairy Markets Lee Mielke the irst week of August but Central region milk produc- tion continues to fall. DMN warned that man- ufacturers are preparing for that milk to “disappear and production slowdowns as ed- ucational institutions begin to reopen.” Spot butter reversed two weeks of loss, inishing Fri- day at $2.27 per pound, up 13 1/2-cents on the week and 28 cents above a year ago. Six- teen cars were sold last week. The butter inched a quar- ter-cent lower Monday on an offer and a sale took it down a penny Tuesday, to $2.2575. Butter production in the Central region was steady last week, according to DMN. “Cream remains avail- able and manufacturers are running full schedules” but “demand for butter remains strong.” Western output also re- mains steady. Cream is gen- erally available and contacts say “domestic butter demand is good with a lot of interest coming from retailers.” Cash Grade A nonfat dry milk closed Friday at 83 1/4-cents per pound, down 1 3/4-cents on the week but 11 1/4-cents above a year ago, with 16 cars sold. Monday saw the powder hold but it jumped a pen- ny and a half Tuesday, to 84 3/4-cents per pound. Milk price jumps The July federal order Class III benchmark milk price is $15.24 per hundred- weight, up $2.02 from June but $1.09 below July 2015. It’s the highest Class III since November 2015 and equates to about $1.31 per gallon, up from $1.14 in June. The seven-month Class III average, at $13.73, com- pares to $16.04 at this time a year ago and $22.52 in 2014. Monday’s Class III futures settlements saw an August contract of $17.14; Septem- ber, $17.24; October, $16.98; November, $16.53; and De- cember at $16.16 per cwt. The July Class IV price is $14.84, up $1.07 from June, $1.69 above a year ago, and the highest Class IV since De- cember 2015. The 2016 Class IV average now stands at $13.42, down from $13.62 a year ago and $23.19 in 2014. 33-1/#04N
