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CapitalPress.com
Friday, October 18, 2019
Dairy
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U.S. dairy exports hit a high note
By CAROL RYAN DUMAS
Capital Press
U.S. dairy exports, Jan.-Aug.
The value of U.S. dairy
exports from January
through August reached
a five-year high of nearly
$3.92 billion, up 3%
from the same period in
2018.
Shipments, however,
were down 13% year over
year in volume with sig-
nificant declines in milk
powders, butterfat, whey
and lactose, according
to the U.S. Dairy Export
Council.
“Basically, commodity
prices are up and therefore
value is up,” Alan Levitt,
USDEC vice president of
marketing and communi-
cations, said.
“While world prices for
milk powder are part of
that, it is more a function
of a very tight cheese mar-
ket,” he said.
Cheese exports in the
first eight months of the
year were up 2% in vol-
ume from a year earlier.
There are two main rea-
sons total export value
Product
NDM/SMP †
Whole milk powder*
Cheese
Butterfat
Total whey
Lactose
Milk protein concentrate
Food preps (blends)
Aggregate
Milk/cream (liters)
Total value** ($ millions)
Exports (Metric tons)
2018
2019
503,064
29,114
241,884
28,933
388,974
279,147
20,342
42,673
1,534,132
75,999
$3,812.8
Percent
change
428,278
24,938
247,479
16,744
299,066
255,197
22,886
34,418
1,329,007
87,987
$3,918.3
-15%
-14
2
-42
-23
-9
13
-19
-13
16
3
* USDA data adjusted to reflect shipments to Mexico misclassified as WMP.
† Nonfat dry milk/skim milk powder ** Total value does not include fluid milk.
Capital Press graphics
Sources: USDEC; U.S. Census Bureau
was up despite lower vol-
umes of most products,
William Loux, USDEC
global trade analyst, said.
“Prices were more
favorable in several of our
key commodities than in
the beginning of 2018,” he
said.
For example, the aver-
age export value of skim
milk powder January
through August was $0.83
a pound in 2018 compared
to $1.04 in 2019, he said.
“So even as we export
less of it, the value grows,”
he said.
The other reason is
cheese has the highest
value per unit of products
the U.S. exports in large
quantities, he said.
“So growing cheese
grows our export value at
a greater rate than SMP
(skim milk powder) whey
and lactose,” he said.
Higher value in dairy
exports doesn’t neces-
sarily correlate to higher
farm gate prices. But milk
prices are rising as nonfat
dry milk and cheese prices
have steadily climbed over
the past couple of months,
he said.
“We’re not looking at
2014 prices, but it’s much
improved from where
we were. U.S. farm gate
milk prices are currently
at a 56-month high,” he
said.
In its latest report,
USDEC
said
strong
domestic markets have
been keeping more U.S.
cheese at home.
Since posting record
export volume in March,
cheese exports declined
five months in a row com-
pared to the previous
month.
In August,
cheese
exports were 6% below
a year earlier in volume,
with lower exports to Aus-
tralia, Japan and South
Korea — although sales to
Southeast Asia were near
record highs.
Export volumes of
other products showed
even larger declines in
August, USDEC reported.
Nonfat dry milk/skim
milk powder volumes
were down 18%, with sig-
nificant declines to Mex-
ico, the Philippines and
China.
Total whey shipments
were off 21%, with nearly
all the decline from lost
sales to China due to retal-
iatory tariffs and lower pig
feed demand because of
African swine fever. Whey
protein isolate shipments,
however, were up 9% led
by improved sales to the
EU, Southeast Asia and
South Korea.
Lactose
shipments
fell 9%, with large
declines in sales to
China, New Zealand and
Japan.
Shipments of whole
milk powder — which
was less than 4% of total
exported dairy product —
spiked to more than dou-
ble a year earlier on strong
sales to Algeria, Colombia
and Peru.
2020 enrollment for Dairy Margin Coverage underway
By CAROL RYAN DUMAS
Capital Press
Dairy farmers have until Dec. 13
to enroll in the Dairy Margin Cov-
erage program for 2020.
Administered by USDA, the
program helps producers manage
economic risk brought on by milk
price and feed cost disparities.
DMC offers reasonably priced
protection to dairy producers when
the difference between the all-milk
price and the average feed cost —
called the margin — falls below a
certain dollar amount selected by
the producer.
Dairy farmers have received
more than $300 million through the
program in 2019 so far, according
to USDA Farm Service Agency.
All producers who want 2020
coverage, even those who locked in
the coverage level for five years in
2019, are required to visit an FSA
office during the signup period to
pay the annual administrative fee.
For more information and to take
advantage of an online dairy deci-
sion tool that assists producers in
selecting coverage for 2020, visit
www.fsa.usda.gov .
DAIRY
MARKETS
Lee
Mielke
Barrel cheese
prices top $2
By LEE MIELKE
For the Capital Press
C
ash cheese prices shot
higher the second week
of October, though trad-
ers are skeptical. FC Stone
stated in its Oct. 10 Early
Morning Update, “Logic and
reason do not drive these mar-
kets. Greed and fear do.”
Block Cheddar climbed to
$2.12 per pound last Thurs-
day but closed Friday at
$2.10, up 10.75 cents on the
week and 49 cents above a
year ago.
The barrels finished at
$2.0225, up 23.25 cents on
the week and 66.25 cents
above a year ago. Last time
barrels topped $2 was Nov.
10, 2014, and that was at
$2.12 per pound. The spread
narrowed to 7.75 cents.
The blocks fell 2.75 cents
on Columbus Day and lost
another 1.75 cents Tuesday,
falling to $2.0550, as trad-
ers mused on the confus-
ing accounts of trade nego-
tiations between the U.S.
and China and weighed the
morning’s Global Dairy
Trade auction.
The barrels inched up a
quarter-cent Monday and
stayed there Tuesday at
$2.0250, but a normal spread
was set at 3 cents.
California
FFA Needs
Your Help
California FFA wants to buy a “CalAgPlate”
for your automobile!
The California Agricultural License Plate
program started in 2014, and since its
inception over $2 million has been raised for
agricultural education.
The program, sponsored by the California
Department of Food and Agriculture (CDFA),
distributes 99 cents of every dollar generated
by the program in the form of grants to agri-
cultural education organizations. Recipients
of these grants have been organizations such
as California Agriculture in the Classroom,
California State Fair Farm Tours, Madera
District Fair, Enrich LA, and the California FFA.
At its conception, the program needed 7,500
plates to be sanctioned by the Department of
Motor Vehicles. The vast majority of those
plates were put on the road by the efforts of
students and teachers of the California FFA.
Currently, the program is in danger of being
cancelled unless an additional 3,100 plates are
put on the road. California FFA and the agri-
cultural community at large are being called
to action to continue this program.
To meet this goal the California FFA will
purchase a CalAgPlate for the first 3,500
vehicle owners who want to support agri-
cultural education in California by placing a
plate on their vehicle. Visit: https://
www.calaged.org/calagplate for the
registration form. Once the form is complete
mail it to the California FFA at P.O. Box 186,
Galt California, 95632. Questions?
Call (209) 744-1600.
“I believe in the future of agriculture, with
a faith born not of words but of deeds….,”
Those words, as written by E.M. Tiffany, serve
as the official FFA Creed and are taught to
every freshman enrolled in an entry level
agriculture course. Despite being 80 years
old, the FFA Creed still holds true today as the
agriculture community has proven once again
their deeds will make our future brighter.
We are being called on to support the future
of agriculture through our deeds, please sign
up for your CalAgPlate today!
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