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Dairy groups file writ of mandate on California milk pricing
 
The “Writ of Mandate” was filed on behalf of Dairy Farmers of America, Security Milk Producers Assoc., Milk Producers Council and California Dairy Campaign. The judge issued a tentative ruling Nov. 9, denying petitioner’s writ of mandate stating, “Petitioners have not demonstrated that Secretary Ross’ quasi-legislative act of determining the Class 4b milk price formula, after public hearing and full economic and technical analysis by CDFA experts, was arbitrary and capricious or entirely lacking in evidentiary support.”
The board of directors for Family Dairies USA, Manitowoc Milk Producers, and Milwaukee Cooperative Milk Producers have called for a membership vote on the proposed merger of the three cooperatives. Members were asked to mail votes into their respective cooperative by Dec. 18. 

Following the announcement of a unanimous board vote to recommend a unified merger for the membership earlier this fall, cooperative members received additional information on the merger through regional meetings and mailings. If passed by the membership, the three cooperatives could become the largest Midwest dairy marketing cooperative and would offer “immense collaborative opportunities to all members,” according to a press release this week.

In dairy politics; National Milk’s Chris Galen talked about the “fiscal cliff” that the country faces in Thursday’s DairyLine broadcast but added that dairy also has a fiscal cliff in the expiration of the price support program at current support levels.

The program reverts to 1949 levels, he said, meaning “much higher support levels which could be very disruptive to the marketplace if the government started buying dairy products at about double the current market level.” He said he hoped this pressure would cause Congress to act and pass a new Farm Bill. 

IDFA survey shows farmers should determine milk price
Meanwhile; the International Dairy Foods Assoc. (IDFA) reported this week on a new nationwide survey which found that 81 percent of Americans agree that individual farmers should have the freedom to decide how much milk they produce and not have a limit set by government policy.

The survey, which was conducted online last month among 2,094 adults by Harris Interactive on behalf of the IDFA, also found that 74 percent of Americans believe milk prices should be based on what consumers are willing to pay. Only nine percent think milk prices should be set by government policy. 

“It’s clear Americans feel strongly that the federal government should stay out of the milk pricing business,” said Connie Tipton, IDFA president and CEO. “Dairy is a dietary staple and a primary source of essential nutrition to tens of millions of Americans. Artificially raising milk prices by manipulating the market, as proposed in the Farm Bill’s Dairy Security Act, hurts consumers and it hurts taxpayers,” she said. Additional details are posted at IDFA’s website.

And, with the apparent demise (unless the 2008 Farm Bill is extended) of the MILC program, the University of Wisconsin’s Dr. Bryan Gould reported how the $448 million in 2012 MILC payments were allocated across states.

More than 22 percent of the payments were obtained by Wisconsin dairy producers. Second was New York, at 9.3 percent, followed by Minnesota, at 8.4 percent. California was next, at 8.3 percent. Gould pointed out that is in spite of the state leading the nation in total milk production and “is obviously a reflection of the payment limitations contained in the MILC program.”

And, with the apparent demise (unless the 2008 Farm Bill is extended) of the MILC program, the University of Wisconsin’s Dr. Bryan Gould reported how the $448 million in 2012 MILC payments were allocated across states.

More than 22 percent of the payments were obtained by Wisconsin dairy producers. Second was New York, at 9.3 percent, followed by Minnesota, at 8.4 percent. California was next, at 8.3 percent. Gould pointed out that is in spite of the state leading the nation in total milk production and “is obviously a reflection of the payment limitations contained in the MILC program.”

Buyers welcome lower cheese prices
The sharply lower cheese prices were welcomed by buyers, according to USDA’s Dairy Market News (DMN), but many are hesitant to order too far ahead until prices have developed “a more consistent pattern.” The lower prices have increased export interest as prices move closer to international levels. The CWT program continues to aid in export sales although none were reported this week.
Manufacturing milk volumes were higher for the holiday shortened week as Class I demand was reduced due to schools being closed. Cheese plants were taking advantage of the increased milk to raise their inventories, according to DMN.

The cash barrel cheese price jumped 3 cents the first day of trading following the Thanksgiving holiday break but gave it back and then some and closed the last Friday of November at $1.7125 per pound, down 3.25 cents on the week and even with a year ago. The blocks held at $1.8250, but plunged 6.5 cents Friday to close at $1.76, 2 cents above a year ago. Six cars of block traded hands on the week and two of barrel. The AMS-surveyed block price U.S. average dropped 6.2 cents, to $1.9934, while the barrels plunged 11.3 cents, to $1.9160.

Cash butter saw a third week of decline, closing Friday at $1.60, down 9 cents on the week and 3 cents below a year ago. Butter has plunged 29 cents in three weeks. Thirteen cars found new homes on the week. The AMS butter average fell to $1.8550, down 2.2 cents.

Churning schedules across the U.S. remain quite active, according to USDA, although butter producers are closely monitoring production trends in conjunction with inventories and demand.  Butter demand slowed Thanksgiving week as those orders were previously placed and shipped. Butter producers and handlers were very pleased with Thanksgiving orders and “look forward to an equally active end of year demand,” DMN said.

The views and opinions expressed in this column are those of the author and not necessarily those of Farm World. Readers with questions or comments for Lee Mielke may write to him in care of this publication.
12/5/2012