As printed in our April 25, 2015 issue...
AT $17.35 PER CWT., USDA HELD STEADY its All-Milk price forecast for 2015. However, the components of that forecast shifted a great deal in the past month as Class III (cheese) moved up 20 cents per hundredweight to a $16.45 midpoint while Class IV (butter-powder) fell 90 cents to $14.75.
CLASS III FUTURES WERE FIRM over the past 30 days at a $16.80 average for May to December contracts. October's $17.33 represented the market high with May's $15.97 the low after two weeks of trading in April.
EVEN THOUGH DAIRY EXPORTS REBOUNDED 21 percent in February when compared to a month earlier, shipments remained near a two-year low. Overall, exports were 13.1 percent of production; imports, 3.2 percent.
THIS APRIL, EU QUOTAS SUNSET. With production caps gone, the U.S. Dairy Export Council has projected that just six countries would account for three-quarters of new milk by 2020: Germany, the Netherlands, Denmark, Ireland, France and Poland. Overall milk growth in EU, the world's second largest dairy exporter, could be 1.8 percent annually.
CALIFORNIA MUST CUT WATER USE 25 PERCENT, ordered Governor Jerry Brown because snowpack levels are just 5 percent of the historical average for April. The roughly 500,000 acres that were not planted last year due to lack of available water seems certain to expand even further.
CORN STOCKPILES WERE 11 PERCENT HIGHER than one year earlier while soybeans were up a whopping 34 percent, reported USDA in its Grain Stocks report. As a result, May corn futures were below $3.80 per bushel, while soybean contracts traded near $9.50.
MILK COMPONENTS CONTINUE TO IMPROVE in the Northeast Federal Order with 3.78 percent butterfat (up from 3.70 percent in 2010) and 3.08 percent protein (up from 2010's 3.05 percent). Other solids held steady.
MILK NEEDED FOR YOGURT has appeared to level off in the Northeast order where New York had been an epicenter for growth in Greek yogurt. Class II use stood at 24.2 percent in 2014, down from the 2012 to 2013 average of 26 percent. Class II had been 21.3 percent in 2010.
MISSOURI LOOKED TO TURN DAIRY AROUND when its governor signed a bill into law that offers farmers reimbursement for up to 70 percent of federal margin protection insurance premiums. It also established a dairy scholars program for 80 scholarships at $5,000 each. Missouri's rank among dairy states had fallen from 13 to 24 in the past 20 years.
BRIEFLY: The proposed settlement between Northeast dairy farmers and Dairy Farmers of America (DFA) was rejected by U.S. District Court Judge Christina Reiss who ruled proposed payments were inadequate. Stakeholders in New Mexico reached an agreement on rules governing how dairies can dispose of wastewater. Ed Townley will succeed Richard Stammer as Agri-Mark's new CEO.
