Friday, April 1, 2022
CapitalPress.com 7
High milk prices not enough to spur production
By CAROL RYAN DUMAS
Capital Press
Farmgate milk prices
have followed dairy com-
modity prices higher world-
wide. But the rising cost of
inputs, lack of labor, unfa-
vorable weather and variable
feed quality continue to limit
milk production, according
to a new report by Rabobank.
Inflationary pressure is
running rampant around the
world, with a worsening out-
look, RaboResearch analysts
said in their Dairy Quarterly
report.
“Dairy commodities will
stay elevated through mid-
year amid the constrained
supply. The longer-term
outlook hinges upon con-
sumer behavior and normal-
ized market conditions, both
being very unpredictable,”
they said.
Even before the Rus-
sia-Ukraine conflict, global
dairy commodity prices
were soaring due to a sup-
ply shortfall. As the short-
MILK PRICE PROJECTIONS
Milk price projections, dollars per hundredweight
Class III
Class IV
Q1 2022 – 21.08
Q1 2022 – 23.98
Q2 2022 – 24.23
Q2 2022 – 22.37
Q3 2022 – 21.93
Q3 2022 – 21.63
Matthew Weaver/Capital Press File
Prices are up but other factors continue to limit milk
production, analysts say.
falls are unlikely to go away
in the near term, Rabobank
expects milk production in
the Big-7 exporting regions
to decline 0.7% year over
year versus last year’s high
comparables in the first half
of 2022.
In addition, the Rus-
sia-Ukraine conflict esca-
lates an already high-cost sit-
uation, the analysts said.
“Russia’s invasion of
Ukraine presents significant
upside price risks for energy,
fertilizer and agricultural
commodities, which will
have a spillover impact on
feed costs, feed availability
and ultimately on dairy com-
modity prices and farmgate
milk prices,” they said.
Q4 2022 –20.21
Q4 2022 – 19.12
Q1 2023 –19.35
Q1 2023 – 17.56
Q2 2023 – 19.28
Q2 2023 – 17.93
Source: Rabobank
Russia supplies about
40% of Europe’s natural gas,
a key ingredient in the pro-
duction of nitrogen-based
fertilizers.
Russia
and
Ukraine account for 28% of
global wheat exports, 18%
of corn exports and 30% of
barley exports, the analysts
said.
“The global commodity
markets are already tight as
other regions battle drought,
rising fertilizer costs and
falling yields and acreage,”
they said.
There would also be
implications for dairy prod-
ucts if China were to support
Russia, risking sanctions
that would apply to 25% of
global dairy demand.
Under that scenario, New
Zealand would seek an alter-
native market for nearly
40% of its dairy exports.
Sanctions on China would
also affect U.S. and Euro-
pean exports of dry whey,
336,000 metric tons and
292,000 metric tons, respec-
tively, as well as other dairy
exports, they said.
“This would be a dire sit-
uation for China and its trad-
ing partners, hopefully pre-
venting it from coming to
fruition,” the analysts said.
Here in the U.S., dairy
exports were up 11% year
over year in 2021. Port con-
gestion will likely continue
to improve, but elevated
costs and delays are likely to
remain a factor in 2022. The
strong exports of the past
two years have been largely
due to gains in Mexico and
China, and similar year-
over-year growth may not be
sustainable, they said.
On the milk produc-
tion side, milk prices have
been high enough to stop
the accelerated culling that
reduced the U.S. herd by
133,000 head between May
2021 and January 2022.
“Class III and IV milk
prices — both above USD
22/cwt. (hundredweight) —
are profitable, but a major
response is unlikely,” the
analysts said.
Developer hopes to rezone 700 ag acres
By BRENNA VISSER
EO Media Group
Roughly 700 acres near
Bend in Central Oregon has the
potential to be rezoned from
farmland to rural housing.
In April, a public hear-
ings officer will evaluate an
application to rezone the land,
which sits north of state High-
way 126 adjacent to Lower
Bridge Way and Coyner Ave-
nue. The property is sur-
rounded by farmland, federal
land and some nonfarm dwell-
ings in rural subdivisions,
according to Haleigh King, a
county associate planner.
It’s unclear what the plans
are for the land, other than a
request to change the zoning
on all 710 acres to rural resi-
dential housing, which allows
for no more than one dwelling
per 10 acres. But the applica-
tion has already drawn oppo-
sition from surrounding neigh-
bors, farmers and Central
Oregon LandWatch, a land use
advocacy group.
“This is an irreplaceable
resource we have,” said Ed
Stabb, who has farmed the
land south of the property for
roughly 22 years. “It’s chang-
ing the historical character of
Deschutes County.”
The applicant, 710 Prop-
erties LLC, is registered to
Robert Turner and Charles
Thomas III, according to the
Oregon Secretary of State’s
Office business registry.
Mark Stockamp, a rep-
resentative for the appli-
cant, declined an interview to
answer why the applicant was
pursuing a zone change for the
land.
“We appreciate the interest
in this process and are excited
to share more about the proj-
ect soon,” Stockamp said in an
emailed statement.
A request to rezone this
amount of land at once is “rare
but not unprecedented” in
Deschutes County, said Peter
Gutowsky, the county’s com-
munity development director.
Ben Gordon, the executive
director of LandWatch, said
the organization is strongly
opposed to the potential rezon-
ing. He argued it will be hard
for the applicant to prove this
land is no good for agricul-
tural purposes when there are
ranching operations next door.
For farmers and ranchers
in the area, a chief concern
is water. Billy Buchanan is a
rancher who has raised Wagyu
and Angus cattle south of the
property for the past eight
years.
Buchanan prides himself
on providing locally sourced
beef to businesses in Central
Oregon.
He is worried about what
building potentially 70 homes
on 10-acre lots will do to an
aquifer that he relies on for his
farming operations. Several
neighbors have already had to
drill wells deeper amid a long-
standing drought.
“It does directly affect us,”
Buchanan said.
Buchanan also argues
the land has agricultural
worth regardless of irriga-
tion. The land could be used
for hay storage, for example,
or to give cattle more room
to roam to keep them from
getting too fat on irrigated
pasture.
“If it can be farmable, I feel
you should keep those residen-
tial areas in other residential
areas,” he said.
According to Deschutes
County records, the applicant
argues other than a small por-
tion around a residence, the
land is not irrigated, which
makes agricultural practices
difficult. A soil study shows
that 71% of the soil that is
deemed generally unsuit-
able for farming, according to
county records.
The applicant says the
land has not been historically
farmed, at least in the last 20
years, according to county
staff.
Growing SW Idaho county may
add ag, rural growth committees
By BRAD CARLSON
Capital Press
Canyon County, Idaho,
leaders may set up sepa-
rate citizen advisory com-
mittees on agriculture and
on rural growth as part of
the new comprehensive
plan.
Development Services
Director Steve Fultz and
Elizabeth Allen, a county
planner and the division
manager for long-range
planning, said the idea is in
an early, conceptual phase,
so details are yet to be
worked out.
The committees could
advise the planning and
zoning commission and
county commissioners on
land-use issues, agricul-
ture impacts or how pro-
posals square with rural
smart-growth principles,
they said.
“We are seeking further
direction from the (county
commis-
sioners) and
from the P
and Z com-
mission,”
Fultz said.
T h e
Steve Fultz fast-grow-
ing county
is updating its compre-
hensive plan and future
land-use map to provide a
vision through 2030. The
update is in draft form.
Approval is expected later
this year.
Fultz said citizen com-
mittees focused on agri-
culture and on rural growth
issues could be incor-
porated into the updated
comprehensive plan.
Allen said creating an
agriculture committee has
generated “positive feed-
back and excitement” from
community members.
“While we as a county
support ag and the pres-
ervation of ag, we real-
ize growth is an import-
ant part of Canyon County
as well,” Fultz said. “It’s
a developing partnership,
but we think it’s a partner-
ship that can work.”
Members of the citizen
committees could include
representatives from the
agriculture and develop-
ment industries as well as
specialists in water usage,
environmental issues, and
compatible rural growth,
he and Allen said.
County commissioners
and the Planning and Zon-
ing Commission on April
28 plan to hold a public
workshop on the proposed
update to the comprehen-
sive plan. Public hearings
are to follow.
Fultz started working
for Canyon County in May
2021. He worked as eco-
nomic development direc-
tor for the city of Cald-
well, which is the county
seat, for 18 years.
EO Media Group File
Northwest processors are buying potatoes from Maine in the wake of last year’s
small crop in the Pacific Northwest.
Northwest processors
buy potatoes from Maine
By BRAD CARLSON
Capital Press
Processors in the Pacific
Northwest, a region known
for its potatoes, are bring-
ing in spuds from Maine to
fill a gap caused by the short
2021 crop and an unexpect-
edly high demand for fried
products.
Potato processors in
Idaho, Washington and Ore-
gon are supplied most years
by farmers close to home.
But last summer’s record
heat wave reduced the
Northwest crop’s yield and
quality, said Dale Lathim,
Potato Growers of Washing-
ton executive director.
Fry processors contract-
ing for the 2021 crop also
ordered conservatively amid
ongoing concerns about
COVID-19, he said.
“At the time there was a
lot of uncertainty,” Lathim
said. “The last thing you
want to do is turn potatoes
back to growers.”
Demand for the 2021
crop turned out to be strong
as the coronavirus spread
slowed, and customer traf-
fic increased at restaurants,
schools and event venues.
Northwest
processors
ultimately bought every
locally grown, process-
ing-suited potato they could
— and determined they
needed more, Lathim said.
Fortunately, growers in
Maine last year had “fan-
tastic growing conditions”
and produced a high-quality,
high-yielding crop that left a
surplus, he said.
Travis Blacker, industry
relations director at the Idaho
Potato Commission, said
processors’ needs are such
that the short 2021 crop did
not meet their demand.
He said fry processors
need and appreciate the pota-
toes grown in the Northeast,
though the shipping costs
increase expenses.
Neither the Maine Potato
Board nor major proces-
sor McCain Foods, which
operates plants in Idaho
and Washington, could be
reached for comment.
Eagle, Idaho-based pro-
cessor Lamb Weston Hold-
ings is slated to announce
quarterly earnings April 7.
The company in its previ-
ous quarterly report said its
raw-potato cost per pound
would increase as 2022 pro-
gresses due to the extreme
summer heat reducing the
2021 Northwest crop’s size
and quality.
USDA’s National Agri-
cultural Statistics Ser-
vice reported the estimated
potato yield per acre last
year dropped 9.75% in
Idaho and 10.2% in Wash-
ington. Maine’s yield per
acre jumped 32%.
Harvested acres were up
5% in Idaho, 3% in Wash-
ington and 5.3% in Maine.
Lathim said Maine pota-
toes began arriving in the
Northwest in December.
Volume picked up after Jan.
1.
In the Columbia Basin,
they arrive by rail at Pasco,
Wash.
“This is the second
time in my 28 years I ever
remember potatoes coming
from the East Coast to the
West,” Lathim said.
In the past, surplus pota-
toes from the Northwest
have also been shipped east
when needed, he said.
“It’s nice when the indus-
try can work together, fill the
needs and keep our indus-
try moving ahead,” Lathim
said.
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