DairyBusiness Update: Dec. 27, 2013

Dairy Checkoff, National Dairy Shrine Offer Scholarships
   Scholarships are again being offered to graduating high school seniors and undergraduate college students who have an interest in pursuing a career in the dairy industry. The awards are granted each year by Dairy Management Inc., which manages the national dairy checkoff, and the National Dairy Shrine.  
Career pursuits include:
·   Milk or dairy product marketing, dairy product development and/or quality control or similar roles in the food industries
·   Dairy education or communication careers in dairy products, related food industries with emphasis in marketing, education, food science, nutrition (human), public relations, journalism or social media communications
   Applications can be downloaded at www.dairyshrine.org. Entries are accepted from March 1 until April 15.

UW-Madison Program on Dairy Markets & Policy
   Mark Stephenson and Bob Cropp decided to "Phone a Friend" to help them understand current dairy market reports. Phil Plourd shared his ideas about what's going on in today's dairy market. You can stream the 11-minute video here.
   John Newton and Cam Thraen also contributed two short articles which help inform the dairy policy debate in the current Farm Bill discussions. You can download a copy of those papers here and here.

2013 dairy cow culling tops 3 million
With statistics yet to be calculated for the final two weeks of the year, 2013 U.S. dairy cull cow slaughter topped 3 million head for a second consecutive year. It’s just the fourth time cull dairy cow slaughter reached that mark since USDA began differentiating dairy cows from total cows in 1986. 
   USDA estimated 62,300 culled dairy cows were slaughtered under federal inspection during the week ending Dec. 14, pushing the 2013 year-to-date total to 3.003 million head, about 19,800 more than the corresponding period a year ago.
   Before 2012, dairy cow slaughter topped 3 million only twice: in 1986, at 3.595 million (whole herd buy-out program); and 1996, at 3.037 million. Source: USDA Market News Service 
Southern Dairy Conference registration deadlines approaching
   "Dairy Collaboration" is the theme of the 40th Annual Southern Dairy Conference to be held Jan. 13-15 at the Embassy Suites, Atlanta Airport.  In honor of the 40th Anniversary, a special pre-conference tour of Williams Dairy (Madison, GA), will be held on Monday, Jan. 13. Owners Everett Williams and family have recently opened a new carousel parlor to milk their 1660 cows and are welcoming tour participants.
   For the full agenda and how to register for the conference, go to the conference website at http://www.southerndairyconference.com.  Early registration discount holds until Jan. 5.  To insure a room at the conference rate of $95, please register directly with Embassy Suites by Jan. 2.
   For more information contact:  Joe Horner, email: hornerj@missouri.edu; phone: 573-882-9339.

Central milk production is status quo
   Central farm milk production levels are status quo this week, according to DMN, with some fear that the recent cold weather in the region will affect production levels. Many milk processors were balancing milk supplies, spot loads ranged from $2.00 under to $0.50 over Class, with the prices being higher than historical trends this week. Bottling demand backed off behind lower sales this week, but is expected to pick back up next week as schools look to refill stocks as classes resume. Additional milk supplies that would have gone into bottling went into butter/powder and cheese production.

October commercial disappearance was great
Jerry Dryer, editor of the Dairy and Food Market Analyst, concurs with DBU’s Dave Natzke that October dairy product commercial disappearance may be at a record level, based on his own tracking numbers. He reported details in today’s DairyLine broadcast, reporting that almost 19 billion lbs. of milk and dairy products were used on a milk equivalent basis, up about 4.6% from a year ago when October 2012 disappearance was up 4.3% from 2011.
   Dryer said he “doesn’t put a whole lot of stock in the monthly numbers because there can be little glitches in the data and commercial disappearance is a residual number, but you step back and it’s still very impressive.” And, commercial disappearance was up 3.9% over the most recent three months, according to Dryer’s data, “so sales, dairy usage has been very strong.”
   When asked what this means for prices and how long we’ll see $2/lb. cheese, Dryer answered, “I can’t answer the $2 cheese number but I can tell you that I think prices are going to remain elevated, well above historic levels, well into the First Quarter, maybe all the way through the First Quarter driven by strong commercial disappearance, which includes both good sales here in the U.S. and very very strong exports.”
Mielke’s Market Daily for Friday
(A daily wrap-up of dairy markets and the things affecting them, from DairyBusiness Update associate editor Lee Mielke)
   Dairy market traders are getting out of the Christmas mode, back to reality, and mulling Monday’s Cold Storage report. Spot cheeseheads left things the way they were this morning so the Cheddar blocks remain at $2/lb. and the barrels at $1.97/lb. Again, there was no activity in either market. The blocks held all week at $2/lb., up 26¢ from that week a year ago, while the barrels are up 2¢ on the week and also 26¢ above a year ago. No cheese was traded in the cash market this week. The lagging AMS-surveyed U.S. average block price hit $1.8888/lb., up 1.9¢, while the barrels averaged $1.8358/lb., down 1.6¢.
   Cash butter was a different story, dropping 3.5¢, to $1.55/lb. That may result in additional head scratching, following Tuesday’s 1.5¢ downturn. Nine carloads traded hands this morning, the first one at $1.58/lb., and kept slipping from there. Three bids at $1.55/lb. went unfilled, and an offer at $1.5525/lb. got no response. Cash butter marched higher on Monday, following two sessions of gain the previous week, but surprised us with the 1.5¢ drop Tuesday, following that bullish Cold Storage report. Yesterday butter was unchanged but, with this morning’s loss, that adds up to a 3.25¢ dip on the week but still 5.25¢ above a year ago. Fourteen cars found new homes on the week. AMS butter averaged $1.6454/lb., up 1.4¢.
   Cash powder was unchanged again this morning. Grade A remains at $2.11/lb. and Extra Grade at $2.09/lb. One bid of Grade A at $2.10/lb. went unfilled and 1 offer at $2.13/lb. was left uncovered. Both prices are unchanged on the week. AMS powder averaged $1.9625/lb., up 1.5¢, and dry why averaged 57.61¢/lb., up 0.2¢.

Today’s market closing prices:
Butter: Down 3.5¢, to $1.55/lb.
Cheddar blocks: Unchanged, at $2.00/lb.
Cheddar barrels: Unchanged, at $1.97/lb.
Grade A nonfat dry milk: Unchanged, at $2.11/lb.
Extra Grade nonfat dry milk: Unchanged, at $2.09/lb.
Class III milk: Jan.$19.48, -12¢, Feb.$18.78 -19¢, Mar. $18.62 -11¢, Apr. $18.30 -7¢, May $18 -5¢, & Jun. $17.85 -7¢. Based on today’s CME closing prices, the Q4 2013 average is $18.68/cwt.; with an overall 2013 average of $17.99/cwt.; and a 2014 average of $18.03/cwt.
Looking ahead:
      The Agriculture Department’s monthly Ag Prices report will be issued Monday, and will include the latest milk feed price ratio. Regular trading hours are in effect Tuesday at the Chicago Mercantile Exchange but is closed Wednesday, New Year’s Day, and reopens Thursday and Friday. USDA announces December Federal order Class II, III, and IV milk prices on Thursday, January 2, and the California Department of Food and Agriculture announces its December Class 4a and 4b milk prices. The November Dairy Products report is issued by USDA on Friday, January 3.
Other’s headlines  
Senator Leahy Optimistic About New Farm Bill
Imperial Valley Cheese to cease operation next week
Local dairy growing, selling cheese in Kroger
Cheese production on the rise at Ohio dairies 
Heart of America Dairy Expo Program Set
Ribbon cutting for University of Wisconsin (UW)-Oshkosh digester on the Rosendale Dairy
Midland Farms Steps In To Fill Potential Supply Void Caused By Closing Of NJ Dairy
November 2013 China Dairy Import Analysis - 27 Dec 2013
PRO-DAIRY e-Alert: New OSHA dairy website

Monday on DairyLine:
   A recent milk initiative supported by the dairy checkoff is helping increase fluid milk sales. California dairyman and DMI board member Steve Maddox explains.
   And California Dairy Council CEO Tammy Anderson Wise tells us CDC has committed to another five years in helping people live healthier lives in the Golden State.