In your September 10, 2019 issue . . .
CLASS III CONTRACTS SLID 30 CENTS to a $17.20 midpoint with a range of $16.80 to $17.40 for the final four months of 2019. For the new year, CME trading indicated a $16.50 midpoint for January-to-July Class III futures. Those contracts had traded 20 cents higher in early August.
IT’S AN EPIC BATTLE between the “low-price” villain and the “high-price” hero, suggested Mark Stephenson. He paints a scenario where Class III could average above $18 in 2020 because dairy product inventories might become tight. To learn more, read Milk Check Outlook on page 533.
NEARLY 17,000 DAIRY FARMS ENROLLED in the Dairy Margin Coverage (DMC) program since June 17. Producers have until September 20 to sign up for retroactive indemnities covering all of 2019’s milk production. To enroll, visit your local USDA Farm Service Agency (FSA) office.
“FOR MANY SMALLER DAIRIES, THE CHOICE is probably a no-brainer as retroactive coverage through January has already assured them that the 2019 payments will exceed the required premiums,” advised USDA Secretary Sonny Perdue in regard to the DMC program.
DAIRY COW CULLING REMAINED 4.7 PERCENT ahead of last year’s pace as 1.894 million head were sent to packing plants through the first seven months when compared to the same time last year. In July alone, 256,800 head were sent to slaughter, up 7.1 percent.
U.S. MILK PRODUCTION WAS FLAT IN JULY as the nation’s dairy farms collectively produced 18.3 billion pounds — essentially the same when compared to last year. Dating back to February, only April with its 0.2 percent gain showed any sign of additional milk.
MILK’S WOES HAVE BEEN HITCHED TO CEREAL. The Kellogg Company reported that cold cereal sales were off 5 percent through the first half of the year. Overall, the collective cold cereal category dropped 6 percent over the past five years even as the U.S. population continued to grow. Of course, cereal and beverage milk are complementary foods.
$1.75 BILLION WILL BE DIRECTED to Canadian dairy farmers over eight years. That announcement came from Prime Minister Justin Trudeau, and the payment will compensate farmers for lost sales due to trade pacts with the European Union, Pacific nations, and other countries.
THE FIRST PAYMENT WOULD BE NEAR $28,000 for an 80-cow dairy, and total payments this year would be $345 million. Reuters noted that Canada will hold its national election in less than two months.
NESTLE TOPPED THE LIST of North America’s largest dairy processors with $14.7 billion sales. Rounding out the top 10 on Dairy Foods annual list were: Saputo, Dean Foods, Danone North America, Kraft Heinz, Agropur, Schreiber Foods, Dairy Farmers of America, Lala Group, and Land O’Lakes. There were no changes among the top five.
In your next issue . . .
Species of small grain forages matter less than management when it comes to growing quality feeds.
Longer forage particles don’t equate to more physically effective fiber and better fresh cow health.
Strange summer weather will give way to interesting feed markets this fall. Stay abreast of market fundamentals to conquer the ambiguity.