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Friday, September 6, 2019 CapitalPress.com Dairy Subscribe to our weekly dairy or livestock email newsletter at CapitalPress.com/newsletters DAIRY MARKETS Lee Mielke GDT auction down slightly By LEE MIELKE For the Capital Press T uesday’s Global Dairy Trade auction saw its weighted average of products offered slip 0.4%, following a 0.2% slippage on Aug. 20 and 2.6% on Aug. 6. Sellers brought 87.5 million pounds of product to the market, up from 75.9 million in the last event and the highest total since Nov. 20, 2018. The losses were led by anhydrous milkfat, down 1.5%, which follows a 3.7% drop on Aug. 20. Butter, interestingly, was unchanged after fall- ing 3.4% last time. Lactose was down 0.9%, Cheddar was off 0.8% after advanc- ing 0.8% in the last event, and whole milk powder was off 0.8%, following a 2.1% rise. Buttermilk powder was up 3.4% and rennet casein was up 4.6. FC Stone equated the GDT 80 percent butterfat butter price to $1.7829 per pound U.S. while CME but- ter closed Tuesday at $2.21. GDT Cheddar cheese equated to $1.7357 per pound, down 1.4 cents from the last event and compares to Tuesday’s CME block Cheddar at $1.94. GDT skim milk powder averaged $1.1338 per pound and compares to $1.1239 last time. Whole milk powder aver- aged $1.3952, down from $1.4061. CME Grade A non- fat dry milk closed Tuesday at $1.0475 per pound. Cheese higher CME cheese shot higher the last week of August. The Cheddar blocks hit a new high for 2019 at $1.93 per pound, up 5 cents on the week and 23 1/2-cents above a year ago. The barrels finished at $1.7375, up 7 1/4-cents on the week and 9 1/4-cents above a year ago; 22 cars of block traded hands on the week at the CME and 36 of barrel. The markets were closed Labor Day but Tuesday’s trading took the blocks a penny higher to $1.94, as traders absorbed the morn- ing’s GDT and anticipated Wednesday afternoon’s July Dairy Products report. That’s the highest CME price since Nov. 10, 2016. The barrels gained a half-cent Tuesday, inching to $1.7425, an unsustain- able 19 3/4-cents below the blocks. Tightness on milk pro- duction is constraining the availability of fresh Ched- dar amid good domes- tic cheese demand, accord- ing to FC Stone’s Sept. 3 Early Morning Update. The 4-week rolling slaugh- ter average dropped below year-ago levels for the first time all year, says FC Stone, “but we’re still killing them faster than we can replace them.” Typical fall demand is helping maintain cheese orders, according to Mid- west cheese producers, and block and process cheeses requests are strong, according to Dairy Market News. Students are return- ing to classrooms spurring food service buying and school milk bottling is pull- ing heavy volumes from cheese vats but manufac- turers are still finding ade- quate amounts of milk. Spot milk offers were not preva- lent early last week but con- tacts expected more dis- counted loads to become available over the Labor Day weekend. 9 PFAS new concern for dairy farmers By CAROL RYAN DUMAS Capital Press Substances used in some types of firefighting foam and household products since the 1940s are caus- ing new concern for U.S. dairy producers. They’re called PFAS — short for per- and polyfluoroalkyl sub- stances — and this year led to the demise of a 4,000-cow dairy in Clo- vis, N.M. Elevated levels of the chemicals showed up in of the dairy’s wells last summer and were found in the milk, according to media reports. The contamination on the dairy has been linked to nearby Cannon Air Force Base and its former use of firefighting foam containing the compound. “This is a rather new item that I continue to hear a lot of concerns about throughout the country,” Lau- rie Fischer, CEO of the American Dairy Coalition, said in a webinar on the issue hosted by the coalition. Some states are moving rapidly on new regulatory or compliance policies, she said. PFAS are an emerging contam- inant in the environment, but the risks are not yet fully understood, Matt Schroeder, an environmen- tal engineer with the Dragon Corp., said. About 5,000 PFAS compounds exist, but only a little is known about a handful of them. But it’s been determined the substances might have some health risks at low levels, he said. The substances repel water and oil, reduce friction and are tempera- ture-resistant. In addition to some types of firefighting foam, PFAS are used in such items as carpets, non-stick cookware, outdoor gear, clothing, cosmetics and food pack- aging, he said. One reason they are a concern is they accumulate in humans and the environment. They are also mobile in the environment and don’t break down naturally, he said. They are typically found in the environment where they or the products containing them are manufactured and where firefight- ing foams have been used. They are regulated differently depend- ing on location, and there is no one enforceable standard, he said. New regulations are com- ing, Leah Ziemba, partner in the Michael Best law firm, said. In 2009, the federal Environmen- tal Protection Agency issued a pro- visional drinking water advisory for two PFAS compounds at 200 and 400 parts per trillion, respectively. In 2016, it issued another advisory for those two compounds at 70 ppt. To put things in perspective, 1 ppt is equivalent to one grain of sand in an Olympic-size swimming pool, she said. In February, the agency issued an action plan that included consider- ing setting a maximum contamina- tion level in drinking water. But states and environmental groups have been frustrated with what they perceive as EPA’s lack of leadership on the issue, and some states have stepped in and set lim- its. Those drinking water standards range from 13 ppt to 70 ppt, she said. “Also, states are becoming more aggressive in regulating PFAS in consumer products,” she said. Washington, for example, has banned PFAS in food packaging. Wisconsin is moving rapidly to regulate PFAS. It has started the pro- cess to set a groundwater standard, with a recommended standard of 20 ppt for the combined level of two PFAS compounds. In addition, the state has requested sampling of influent and effluent at 130 wastewater treatment plants for 36 PFAS compounds. “I think the path that Wiscon- sin’s taken is a good example of what can happen and how quickly,” she said. Rabobank: Conventional milk needs to reinvent itself By CAROL RYAN DUMAS Capital Press Shrinking consump- tion of fluid milk in devel- oped countries and slim margins are making things tough for conventional milk processors. While milk remains a household item in the U.S., people are drinking less of it and not going through it as fast as they once did, Tom Bailey, Rabobank senior dairy analyst, said. Bailey outlines the issue and what processors can do to improve their bottom line in his new report, “Making Milk Cool Again.” Understanding what con- sumers want and value, and investing in innovation and marketing are key, he said. For the past 10 years, demand has fallen 2% year over year in North America and 3% in Western Europe. But there are steps com- TownNews.com Content Exchange While milk remains a household item in the U.S., people are drinking less of it and not going through it as fast as they once did, Tom Bailey, Rabobank senior dairy analyst, said. panies can take to recast the image of milk in the eyes of consumers and see it grow into the category it once was, he said. “Some successful brands have already proven that milk can be cool,” he said. “But, if the last 10 years taught the dairy industry anything, it is that the wrong milk is being marketed incorrectly to the wrong consumers.” The lack of innovation in production development leaves the industry with non- fat or skim milk in a trans- lucent jug with a traditional label, he said. “It’s not what the con- sumer is looking for,” he said. Conventional skim milk is declining the fastest and is the most unfavorable from a consumer perspective, he said. But sales of whole, organic and filtered milk are all growing, he said. Anyone wanting to com- pete needs to revamp their milk — giving it higher quality, newer packag- ing and rebranding — and communicate effectively through modern marketing mediums, he said. A 2018 survey by Mintel found the top reasons U.S. respondents consume milk is because it is nutritious, tasty, has vitamins and min- erals, is rich in good pro- teins and is a good value. Mintel also found the top reasons that would make people drink more milk are extra protein, probiotics and less sugar. Fairlife milk meets the top three factors in driv- ing more consumption and has 30% more calcium than conventional milk. It also offers single-serving options and ultra-pasteur- ization, which were two other factors noted by sur- vey respondents. That might be why Fair- life has grown 263% since 2015, now accounting for 3% of all U.S. fluid milk sales by value, he said. Consumers also care about sustainability and ani- mal welfare, and younger consumers rely heavily on social media. Processors can differ- entiate their product from conventional milk and add value for higher margins or they can go the scale and efficiency route, he said. “Eighty-five percent of Americans still have milk in their fridges, but if you want to make margins you need to premiumize or become more efficient,” he said. John Deere Dealers See one of these dealers for a demonstration 36-4/103
