Consumer scrutiny over animal care has heightened again due to the Hallmark meat recall. National Milk Producers’ Federation (NMPF) is taking steps to help educate dairy producers in that regard, according to NMPF’s Chris Galen. Galen said that the Federation’s National Health Committee met this week to discuss what additional educational materials might be warranted in response to what people have been viewing on Utube and the Humane Society’s website.

“We need to reassure both customers and ultimately consumers, that decisions about cow care, including culling, are sound and responsible,” Galen said. Congress, the USDA and private sector companies are going to be asking more questions about beef industry practices, including the treatment of all cattle, he said, and “We will have to deal with that.”

We talked about the National Dairy Animal Well being Initiative which was developed last year by several dairy entities to set on-farm standards the industry could rally around and point to as practices that dairy farmers uniformly endorse.

Galen looks for more discussion on this in the coming year as a resource that producers can use.

“In the future we can expect more food industry customers to care about what happens on dairy farms and beef ranches and that may include looking at what sort of standard individual producers have,” he said. Dairy farmers are invited to comment on the guidelines to National Milk and a website is available for more information at www.dairywellbeing.org

Colorado dairy producer and U.S. Dairy Export Council (USDEC) board member, Les Hardesty reported that U.S. dairy exports enjoyed unprecedented sales in 2007, driven by U.S. dairy producer’s willingness and ability to capitalize on tight world markets and strong dairy demand.

He said that dairying today in the U.S. is “truly is a global business,” and “The health of our U.S. dairy industry truly depends on the strength of world markets and that’s a change from the last few years.”

2007 exports totaled $3.06 billion, up 62 percent from 2006 according to Hardesty, who called it “great news for dairy farmers in the U.S,” and, because of that strength, the U.S. enjoyed a trade surplus in 2007.

The continued success in the world market is dependant on DMI, the national dairy checkoff, and the USDEC, Hardesty said, and “Because U.S. dairy products are of such great quality, the world wants our dairy products,” and he said that he was proud to be a dairy farmer and a member of the USDEC.

He also reported that 39 percent of U.S.-produced nonfat milk, dry milk and 59 percent of whey proteins were exported in 2007.
“Those are huge numbers and truly do help drive our domestic prices and help to keep domestic prices firm for U.S. producers,” Hardesty added. “Exports are no longer just an opportunity but truly are a critical factor in driving our market.”

Export gains occurred in 2007 in nearly all categories of dairy, according to Hardesty. On a value basis the four top categories being dried milk, either skim milk powder or nonfat dry milk, whey protein, cheese, and lactose. Those four categories alone equated to three quarters of U.S. dairy exports, he concluded.

Numbers remain steady

U.S. milk production continues to run well ahead of year-ago levels and hasn’t shown a decrease since February 2005. The U.S. Department of Agriculture preliminary data shows February output at 13.9 billion pounds, up 6 percent from February 2007, but the data includes the extra day in February this year.

The CME’s Daily Dairy Report lends some perspective, pointing out that, when adjusted for the extra day in February this year, the 23-state total is up just 2.4 percent and the extrapolated 50-state total is only up 1.9 percent.

February cow numbers totaled 8.42 million, up 9,000 from January, and 136,000 head more than a year ago. Output per cow averaged 1,653 pounds, up 69 pounds from a year ago.

California’s February output was up 5.5 percent from a year ago, thanks to 46,000 more cows and 50 pounds more per cow. Wisconsin was up 4.4 percent, on a 60 pound gain per cow and 3,000 more cows. New York produced 7.1 percent more milk than a year ago, thanks to a 110 pound gain per cow outweighing a 2,000 cow decline. Idaho was up 11 percent, thanks to 30,000 more cows an 80 pound gain per cow. Pennsylvania was up 2.6 percent on a 30-pound gain per cow and 3,000 more cows, and Minnesota output saw a 4.4 percent increase on a 40 pound gain per cow and 8,000 more cows in the herd.

The biggest percentage gain was scored in Colorado, up 18.2 percent, followed by Texas, up 16 percent, New Mexico, up 12 percent, and then Idaho. The biggest loses occurred in Oregon, down 8.2 percent, Missouri, off 5.1 percent, and Kentucky with a 1 percent decline.

The cash cheese market started the Easter holiday shortened week on a continued decline from the previous week but reversed gears Tuesday.

The block price closed Thursday at $1.80 per pound, down just a penny on the week but 40 cents above a year ago. Barrel closed at $1.7750, up 3.5 cents on the week, and 36.5 cents above a year ago. Twenty one cars of block traded hands on the week and 22 of barrel. The NASS U.S. average block price averaged $1.9975, down 4.8 cents. Barrel averaged $1.9745, down 2.7 cents.

Butter closed Thursday at $1.3875, up 3.5 cents on the week, and 5.75 cents above a year ago. Nothing has sold in the cash butter market since Feb. 29; the gains have all come on unfilled bids. NASS butter averaged $1.2785, up 7.9 cents. NASS nonfat dry milk averaged $1.2385, down 3 cents, and dry whey averaged 24.38 cents, down 0.3 cent.

University of Wisconsin Emeritus Professor Robert Cropp said that a $1.70 block price by April first was his expectation, even though cheese has been tight. He blamed rising milk production and seasonality. He said that demand has been pretty good but it’s been a tight situation because of the concern over plunging inventory values when cheese prices dropped. Buyers and manufacturers have been cautious, he said.

January Cheddar production was down about 4.5 percent from a year ago and Cropp cited the big decline in California due to a closed plant. Demand may be okay, he said, but supply and demand has been kept pretty tight.

When asked if the export market had contributed to the strength of the cheese market, Cropp replied, “Yes, it did.”

January cheese exports were up about 20 percent from a year ago, he said, and exports ended last year pretty strong, but he quickly added that’s only about 2.4 percent of total U.S. cheese output and a little over 1 percent of the Cheddar supply.

Look for the butter bubble to burst after Easter, according to Cropp. Specials are on right now, he said, and that has boosted demand but Class II product demands have been filled so more cream will be available to the churn. Butter prices are above a year ago, he concluded, but it’s about at the peak and will see a little decline as we move into summer and then rebound next fall.