June 9, 2012 - 2nd section

Page 2 • Dairy Star • Second Section • Saturday, June 9, 2012

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Dairy Star • Second Section • Saturday, June 9, 2012 • Page 7

e v o L u o Y o D The Dairy Star, in conjunction with Kemps Ice Cream, is sponsoring a “Find The Kemps Logo” contest.

1) Count the Kemps logos throughout this issue (excluding this page), 2) Àll out the entry blank below, 3) send it to the Dairy Star entries must be received by June 30th. Winners will be drawn from the correct entry blanks received. Ten winners will each receive $20 in Kemps coupons.

Participants must be a registered Class A or B dairy farmer. One entry per person. All employees of the Dairy Star are ineligible for the contest.

Send entries to Dairy Star, 522 Sinclair Lewis Avenue, Sauk Centre, MN 56378; Attn: Ice Cream Contest.

Check the July 14th issue of the Dairy Star to see if you are one of the lucky winners!

Actual Size To Look For!

Look for these Kemps products in your local grocer’s shelves!

Name Address City Telephone I found

Kemps logos.

Page 8 • Dairy Star • Second Section • Saturday, June 9, 2012

The “Mielke” Market Weekly

By Lee Mielke

Prices and policy have our attention All eyes remain on milk prices. California’s May 2012 Class 4a butter/powder milk price is $13.45 per hundredweight (cwt.), down $1.27 from April and $6.49 less than May 2011. The 4b cheese milk price is $13.56, up 13 cents from April, $1.18 less than a year ago, and $1.67 below the Federal order Class III price.

The 4b price 2012 average now stands at $13.66, down from $15.05 at this time a year ago and compares to $12.30 in 2010. The 4a price average is now at $15.04, down from $18.56 a year ago and compares to $13.37 in 2010.

Looking “back to the futures;” after factoring in the announced Federal order Class III milk prices and the remaining futures, the average Class III milk price for the rst six months of 2012 stood at $15.65 on March 2, $15.70 on May 10, and $15.94 on May 25. The last half of 2012 was averaging $15.61 on April 27, $15.08 on May 4, $15.44 on May 11, $15.69 on May 18, $16.13 on May 25 and $18.57 on June 1.

And, as the old saying goes, “What goes up must come down,” and then back up again. Cash block cheese, after hitting the high for 2012 at $1.65 on June 1, reversed gears and headed sharply lower the week of June 4. Carloads of block traded hands on the week and of barrel. The lagging AMS-surveyed U.S. block price slipped a half-cent to $1.5163. The barrels averaged $1.4995, up 0.6 cent.

Increased milk production is mainly gong to the churn and the dryer. April butter production totaled 170 million pounds, according to USDA’s latest Dairy Products report, down 3.3 percent from March but 7.2 percent above April 2011. Nonfat dry milk output hit 192 million pounds, up 2 percent from March and a whopping 31.1 percent from a year ago.

American type cheese, at 372 million pounds, was down 2.7 percent from March but 3.5 percent above a year ago. Total cheese output hit 903 million pounds, down 4.7 percent from March but 2.1 percent above a year ago.

Cheese plants were busy over the Memorial Day holiday weekend as surplus milk was available, according to USDA’s Dairy Market News. Production of cheese is increased over last year and supplies are described as manageable.

The Cooperatives Working Together (CWT) program continues to assist with export sales, USDA reported, and another earthquake in Northern Italy may further affect supplies of Parmigiano-Reggiano cheese which ages for two years.

CWT accepted eight requests for export assistance this week to sell a total of 1.938 million pounds of Cheddar and Monterey Jack cheese to customers in Asia, North Africa and the Middle East. The product will be delivered through November and raised CWT’s 2012 cheese exports to 56.6 million pounds plus 44.3 million pounds of butter and anhydrous milkfat to 27 countries.

Churning activity the last week of May increased as surplus cream volumes, especially over the holiday weekend, were heavier, USDA said. Many butter producers did indicate that weekend cream offerings were not as heavy as anticipated. Some ice cream manufacturers maintained steady production during the holiday period, which is often not the case during a holiday weekend.

Surplus cream offers further declined early in the week as Class II operations, which reduced production schedules during the holiday period, resumed

production. In most instances, current churning schedules are keeping pace with demand although butter continues to clear to inventory. Butter demand is seasonally fair to good. Retail buyers continue to report features which are clearing good volumes of print butter.

Nationally, advertised butter prices from the National Dairy Retail Report showed a weighted average price of $2.49 per pound compared to $2.57 two weeks prior. Featured prices ranged from $1.49 in the Midwest to $3.49 in the Northeast. Food service orders are increasing as resort and vacation areas across the country prepare for the summer vacation season, USDA said.

AMS-surveyed powder averaged $1.0957, down 3.6 cents, and dry whey averaged 51.66 cents, down 0.7 cent.

Advertising or not, uid milk sales continue to slide. The June 1 California Milk Producers Council (MPC) newsletter pointed out that bottling plants used “less than their share of the milk supply simply because, once again, uid milk sales fell by far more than had been the normal case for oh so many years.”

Preliminary gures from federal order areas show class 1 usage in April was down 4.4 percent from April 2011, according to the MPC, and California class 1 sales were down 2.9 percent. MPC adds that “Only two out of the last 30 months have U.S. class 1 sales been higher than the year before, and one of those was February, helped by an extra day of sales.”

Checking the international dairy scene; the June 5 Global Dairy Trade-weighted index for all dairy products soared 13.5 percent from the index on the May 15 auction, according to FC Stone’s eDairy Insider Closing Bell (ICB).

Anhydrous milkfat led the GDT price increase, with August up 43.6 percent and the average across all contracts from August through December up 24.4 percent from May 15 prices. The average anhydrous milkfat price on the May 15 event had plunged 11.6 percent from May 1.

Most other products on the GDT gained. The increases across all contract periods were 21.3 percent for skim milk powder, 19.6 percent for rennet casein, 10.9 percent for milk protein concentrate, 9.4 percent for cheddar cheese, and 8.5 percent for whole milk powder. The only decline was for lactose, down 1.3 percent, according to the ICB. Meanwhile; the “Policy Wars” continue as the House Ag Committee looks at the new Farm Bill.

A press release this week from the National Family Farm Coalition (NFFC) points out that, “Dairy farmers across the country struggle both nancially and emotionally,” and charged that “the dairy pricing system is clearly broken.”

They report that the rst ve months of 2012 resulted in declining farm milk prices, putting thousands of dairy farmers out of business and many more on the brink of economic collapse, adding that the losses hurt not just dairy farmers and their families but thousands of farm-related businesses.

“Flawed trading practices at the Chicago Mercantile Exchange further diminish the value of struggling dairy farmers’ product,” according to the NFFC. “Ultimately, we rely more and more on dairy imports, leaving consumers with fewer safe and local choices, undermining our nation’s food security.”

The NFFC continues to support S. 1640, the Federal Milk Marketing Improvement Act of 2011,

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introduced by Senator Bob Casey (D-PA), and NFFC leaders met with President Obama in August 2011 as part of the White House Rural Council meetings. “We continue to call for restructuring the nation’s dairy policy to save the family dairy farm,” the NFFC concluded.

On the other side of the battle, lawmakers were told by a Virginia dairy producer that “Dairy farmers need Congress to pass a new Farm Bill now to help provide certainty for making future business decisions.” Those were the words of Sarah Leonard, a fourth-generation dairy producer from Midland, Virginia, who spoke on behalf of National Milk at a Senate news conference this week about the Agriculture Reform, Food and Jobs Act of 2012 (the 2012 Farm Bill).

“On our farm, we don’t focus on the latest polls, or whose campaign is raising the most money,” Leonard explained. “We focus instead on how much rain we received last night, how much milk the cows are generating today, and what the market price of corn and soybeans are. That’s our daily reality. But part of that reality is, we need a new farm bill.”

Processors, represented by the International Dairy Foods Association (IDFA), remain opposed to any kind of supply management feature for dairy.

Speaking in Wednesday’s DairyLine radio program, IDFA’s Jerry Slominski began; “It’s a standard joke for a politician when asked to take a position to say I’ve got friends who are against it and friends who are for it and I’m with my friends.” He said he didn’t blame farmers if they are starting to feel the same way about economic studies of the proposed Dairy Security Act (DSA).

He criticized a recent study of the DSA conducted by Dr. Scott Brown, charging that Brown “used stochastic modeling to predict that the new milk supply management program would seldom be in effect and that exports and milk prices would be nearly unchanged.” “Stochastic” literally means “involving guesswork or conjecture,” Slominski explained.

“Instead of conjecture about what will happen, Drs. Andy Novakavic and Mark Stephenson looked at data from the past ve years to see what actually would have happened,” Slominski said. “They found the supply management program would have been in effect nearly 20 percent of the time.”

“They also found that farmers of nearly every size would have had more money withheld under the stabilization program than payments received under the margin protection plan. Only if cows are culled and feed savings accounted for did farmers end up in the black under the program,” he said.

He added that “Farmers can cull cows, dry cows off earlier or reduce feed in order to reduce production and save costs. Yet, every one of those options have long term implications for a farm’s milk production, and it’s very possible that many farmers won’t reduce production at all. In those cases, the Dairy Security Act directly results in lower net income to a farm, not more.”

“Producers would be better off if Congress dropped the supply management plan and offered a stand-alone margin protection plan, Slominski concluded. “Premiums would be slightly higher, but producers would not have money withheld from their milk checks due to the stabilization program, nor would producers have to decide whether or not to adjust milk production in the short run and how.

This can easily be done by Congress without busting the budget.”

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Dairy Star • Second Section • Saturday, June 9, 2012 • Page 15

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Case IH 8330, #CFH0003850 ..................Call Sold #8491..........................Call ‘95 Gehl DC2360, ‘99 NH 1431, #634110 ......................$12,900 NH 1431, #621381 ..............................$10,900 ‘89 NH 499, #533992 ...........................$6,900 ‘84 NH 499, #479499 ...........................$6,900 NH 499, #617762...................................$8,500 Sold

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Page 32 • Dairy Star • Second Section • Saturday, June 9, 2012

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