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TheDairySite Newsletter - 9 March 2012

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Friday 9th March 2012
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Welcome to this week's newsletter

Editorial - Dairy Policies to Protect Producers Come Under Criticism

In 2009, the global dairy market suffered as prices paid to producers plummeted, yet input costs escalated. With dairy businesses in the US and the EU suffering, the US government paid out subsidies to help producers cope with tough times. In the EU, a high level support group was established to determine how the producers' position in the supply chain could be strengthened.

The 2009 milk crisis saw a number of producers leave the business and put pressure on governments to act in order to prevent such a crisis occurring again.

Last year, the US proposed the Dairy Security Act 2011, its aim to create a stronger dairy net for US producers. In brief, the Act would stabilise the dairy market and protect producers margins through a voluntary insurance programme.

The EU's high level support group proposed a number of measures, through the Milk Package, to strengthen producer power and protect them from future market collapses. This focuses on contractual agreements between producers and processors as well as supporting producer organisations.

This week, both policies came under criticism from producer representatives.

US

A recent USDA report highlighted the issue of small farms declining, with the numbers of herds milking less than 1,000 cows falling. In contrast, larger farms with more than 1,000 cows were increasing in size, numbers and percentage of production.

Commenting Jerry Slominski, from the International Dairy Foods Association, said that the Dairy Security Act would further increase the rate at which small farmers leave the business.

The Act requires that payments be reduced under supply management, which is likely to have a harsher impact on smaller farms.

“It’s pretty easy to see how the small farms will get squeezed out of business faster by this new government programme,” said Mr Slominski.

EU

The European Milk Board (EMB) has said that the EU milk package will only confirm the weak market position of dairy producers. Whether contracts are voluntary or not is left down to individual member states to decide - this decision by the EU has come under heavy criticism by farming unions, who believe that contracts should be obligatory in every country.

The milk package also refers to a European price monitoring instrument, however, EMB President Romuald Schaber says that this is not enough. He believes that the costs of milk production, market supply and demand must also be ascertained, along with milk prices, in order to monitor the milk markets.

With regards to producer organisations, he said that the pooling limits of 3.5 per cent of milk production across the EU and 33 per cent nationally are much too low. Processors, as bargaining partners, already have a market share triple that size.

Over the past few months, a number of mergers have been made in the EU dairy processor industry, which could cause further concern to milk producers wanting to gain more bargaining power.

Charlotte Johnston



* This Week's Feature Articles

We have 5 new features this week:

Productivity to Mitigate Environmental Impacts of Cattle
It seems to be a common consumer perception that the modern dairy herd and its practices are more damaging to the environment than extensive systems. Speaking at the British Cattle Breeders Conference, Dr Jude Capper presented research that suggested environmental sustainability is linked to farm efficiency, reports Charlotte Johnston, TheCattleSite editor.
Dairy Commodity Report - ABARE
In the short term, world dairy prices are expected to fall slightly according to the Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES).
DairyCo UK Dairy Market Update: Butter Markets Weaken
In Dairy Co's monthly update, farmgate milk prices in the UK are at a similar level to Actual Milk Price Equivalent and US producers are shifting to larger herds.
Australian Dairy Production - An Overview
There are 8,594 dairy farms in Australia, with a national dairy herd of 1.6 million cows, according to the National Farmers' Federation Australia Farm Facts 2012.
Reducing Volatile Organic Compounds in Silages
Volatile Organic Compounds (VOC) can have short and long-term adverse health effects but can also impact feed intake. Biomin looks at how VOCs can be reduced in silages using inoculants.
Pfizer Animal Health
* Market Reports

 » USDA Dairy Products Prices Highlights
 » World Agricultural Supply and Demand Estimates - March 2012

* Global Dairy Cattle Industry News

   Mexico

 » Gov't Supports Grazing Project to Mitigate Drought

   New Zealand

 » Advice for Missed Milkings due to Storms
 » DIRA Changes Must Consider Shareholders

Genus - Value through science and genomics
   United States

 » Supply Mgt Programme Will Hurt Small Dairy Farmers
 » CME: February Class III & IV: $16.06 & $15.92
 » Vilsack: Passing US Farm Bill Is Critical
 » CME: Cheese & Whey Futures Pressure Class III Lower
 » Weekly Roberts Market Report
 » Anticipating the 1 March Corn Stocks Estimate
 » Permanent Injunction Against Raw Milk Producer
 » Silage Source Considerations
 » Over-regulation Threatens Domestic Production
 » NFU Outlines Farm Bill, COOL Priorities
 » Class III and Cheese Futures Continue to Rebound
 » Expert Discussions on Antibiotic Use in Animals Ag
 » NFU Delegates Adopt Dairy/ Beef Orders
 » Dairy Cow Slaughter Picking Up
 » FDA reports Continued Fall in Residues in Raw Milk
 » Milk Production per Cow Continues to Increase
 » CME: WASDE Estimates Likely to be a Mixed Bag

   United Kingdom

 » DARD TB Proposals a New Low Point for Farmers
 » 121 Farms with Schmallenberg
 » Large Herd Seminar to Offer Dairy Farm Solutions
 » Dairy Farmers to Make Most of Seller's Market
 » Clear Labelling Needed for Non-Stunned Animals
 » Dairy Processors Reduce Carbon Emissions by 28%
 » Cattle & Calve Numbers Continue to Fall in Wales
 » Animal Feed Production Down 3.2% in January 2012
 » UK Cattle & Calves at Lowest Figure Since 2005

Cow Signals Training Books
   Ireland

 » Domestic Milk Intake Down 12.2% in January
 » Welfare Bill Impinges Standard Practices

   Global

 » Green Shoots of Recovery Emerging?
 » International Milk Prices Fall in Global Dairy Trade
 » Kenya Opts for Ayrshire Genetics Over US Holstein
 » Over-regulation - Is it Limiting Food Production?
 » Near-Record Wheat Production Expected This Year
 » Organic Sales Bucking the Trend

   France

 » IFA Meet French, Italian & Spainish on CAP 2013
 » Life Technologies Acquires LSI
 » Cattle Are Not a Reservoir for New STEC

   Taiwan

 » FMD-Positive Pigs Found in Taiwan

Animax Veterinary Health
   Zambia

 » FMD NEWS: Zambia Reports FMD Outbreak

   Australia

 » Broadacre Industries to Perform Well
 » ABARE Outlook: Strong Performance Forecast
 » 2012 Prospects Look Strong
 » Biosecurity Underpins Export Trade
 » Grants to Improve Live Export Welfare Standards

   European Union

 » CAP: European Farmers React to Proposals
 » High up Take of Butter Private Storage
 » Salmonella Cases Down - Campylobacter Increasing
 » 2011/12 Cattle Slaughter Figure Adjusted Upwards
 » Milk Package Consolidates Weak Market Position

   Germany

 » 847 Holdings Affected by Schmallenberg

   Canada

 » Canadian Farmers Trust Regulated Dairy Industry
 » Technology Offers Barley Digestible Energy Analysis
 » CIGI-ANAC Feed Manufacturing Course Set for April

   Brazil

 » BRF Cheese Factory Opens in Goiás

   Egypt

 » Gov't to Combat FMD and High Poultry Prices



That's all for this week!

Ed.
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