DAIRY MARKETS SNEEZED as the coronavirus continued to wreak havoc in China. In early February activity, New Zealand’s Global Dairy Trade slid 4.7% as milk powder prices tumbled during biweekly trading.
NOT ONLY IS CHINA the world’s largest dairy product and milk powder importer, its economy has become interconnected with the world. When SARS hit in 2002, the Asian country accounted for 5% of global trade. Its economy has grown ninefold and it now accounts for 12% of trade.
AFTER HOVERING NEAR $18 in late January, Class III futures slid back to $17.30 per cwt. for March to April contracts. July to December futures netted $17.60 . . . values close to those on January 2.
BUTTER OUTPUT CONTINUES TO OUTPACE demand, and it’s one of the reasons that protein has garnered more value in milk checks. In January, protein netted $2.96 per pound and butterfat $2.11 under federal order milk component pricing. Class III was $17.05 per cwt.
MILKFAT CLIMBED TO A WHOPPING 4.06% nationally in November, 4.05% in December, marking the highest two months since the 1950s. Two states, Texas and South Dakota, posted levels near 4.4%. On a volume basis, milkfat grew for 50 straight months, according to USDA data.
CHEESE CONSUMES ABOUT 43% of the nation’s milkfat with another 18% going to the butter churn. Cheese accounted for 38% in 2000.
U.S. DAIRY EXPORTS FINISHED STRONG, topping the $6 billion mark for the first time since 2014. Overall value was up 8% when comparing 2018 and 2019; up 25% over the past three years.
ON A MILK SOLIDS BASIS, U.S. dairy product sales to international customers were equivalent to 14.5% of milk solids production in 2019.
IRELAND’S DAIRY FARMERS face an uncertain future after the U.K. left the European Union without a trade agreement. The Irish Isle exports half of its beef and nearly half of its cheese to the Brits.
THE JUSTICE DEPARTMENT has begun probing into a potential sale of Dean Foods to Dairy Farmers of America. Federal antitrust regulators are investigating the potential impacts on milk prices and competition.
CALIFORNIA COULD HAVE A RESOLUTION to its quota issue. After months of study, Marin Bozic and Matt Gould recommend that the Quota Implementation Plan (QIP) terminate on March 1, 2025. Additionally, the Regional Quota Adjuster (RQA) be equalized to $1.43 per cwt.
IF APPROVED, FARMERS HOLDING QUOTA would be paid $300 per pound of solids for that quota over five years. A final decision is pending.
ABOUT 12% OF CANADIAN HERDS milk their cows with automated milking systems, according to DHIA data. “I think that number is underreported because some herds go off test when they install robots,” the University of Calgary’s Herman Barkema told those at the NMC meeting.
A RECORD LOW 0.009% of pickup tanker milk loads tested positive for antibiotics — 327 out of 3.6 million samples under the FDA’s testing plan.