Long-term global dairy demand cited for Elanco’s decision to purchase recombinant bovine somatotropin business from Monsanto.

By Dave Natzke

Elanco has been the international marketer of Monsanto’s recombinant bovine somatotropin (rbST) technology, Posilac, for a decade. Now they want to own it.
Citing growing global demand for dairy products, leaders of Elanco, the animal health division of Ely Lilly, announced an agreement to purchase the worldwide rights to Posilac, as well as the product’s supporting operations.

Dennis Erpelding, Manager, Government Relations, Public Affairs and Communications

Dennis Erpelding, manager of Elanco’s government relations, public affairs and communications, said the acquisition will help extend and expand Elanco’s presence in the global dairy industry, a presence that includes both opportunity and responsibility.
Erpelding, who has traveled extensively internationally, most recently in China, Vietnam and Europe, noted U.S. dairy export growth is an indicator of a growing global dairy market.
“Right now, U.S. dairy exports are up dramatically, due to growing global demand for dairy products,” he said. “Exports were up 62% last year, to $3.06 billion, representing over 9.5% of the U.S. dairy industry production.
“China is trying to meet the dietary needs of its children and adults, and recently raised its recommended dietary guidelines for consumption of milk and dairy products from 100 to 300 grams per day,” he continued. “That’s for a population of 1.3 billion people, and we see that as an opportunity.
“I was in Vietnam in January, and they’re trying to increase dairy production,” Erpelding added. “They have people living on 25¢ to $3 per day. They’re looking at affordable products, and dairy proteins are one of the key sources and opportunities from a nutritional standpoint. There’s real opportunity to help meet human nutritional needs. The United States is a global dairy production leader and supplier, and it can step up on the international stage.”

Jeff Simmons, President of Elanco

Elanco president Jeff Simmons, who also brings a global perspective as the company’s former manager in Brazil and Western Europe, said Posilac was “a good fit” for his company.
“It’s a volatile and changing time in agriculture, and we’re center stage,” he said. “It brings opportunity for us.”
Simmons admitted Elanco officials held internal discussions questioning acquisition of Monsanto’s controversial Posilac business.
“From a strategic perspective, we first asked ourselves if this product was safe,” he explained. “As a pharmaceutical company, it’s one of the first things we ask. Second, we looked at was efficacy: “Is this product effective? Is the value proposition of this product sound? And third, do consumers and the marketplace want this product?
“We know this product is extremely safe,” Simmons said. “That is not the issue. And, it is extremely efficacious, and the value proposition is increasing. The need for milk is increasing, especially as you look at the global market. We’ve seen that in our experiences in Mexico, Brazil and South Africa. That fundamental need we believe so strongly in is one of the reasons which brought Posilac up front.
“When you get down to the consumer, and ask why we would touch this product, we’ve chosen this business, an innovative-driven, productivity, animal health-type company, and we believe strongly that we need to stand up for this,” Simmons continued. “If 70% of the solution to increase meat and milk production by 50% is innovation, the last thing a company like Elanco can do is back away. We believe we are bringing value to the food chain, and that value is going to be needed more in the future than ever.”

Technology familiarity
Two decades ago, Erpelding and Simmons were part of the Elanco team involved in early rbST research. But Monsanto was first –- and the only –- company to bring a product to market, making Posilac commercially available in 1994.
“We’ve been familiar with this product for more than 20 years,” Simmons said. “So when it comes to manufacturing, to public affairs, to marketing globally –- it is something we are very familiar with, from the science to the producers and the activist groups.
”We’ve been working in collaboration with Monsanto for some time,” said Simmons, who noted Elanco has been the exclusive international marketer of Posilac for a decade. “(Acquisition) has been on the table for some time. Given the value, and where we’re trying to go with this company internationally, it was attractive.
“Purchase of this business is strategic and financial, but it’s more than that,” he continued. “We have 2,000 employees globally, and there’s more to what drives us than trying to sell a product. If someone is going to bring innovation to help solve this global food shortage and address the economics of food in the United States, we need to be part of that solution.”
Simmons noted Elanco recently aligned with Heifer International, a nonprofit organization helping supply dairy animals to countries as a sustainable approach to address hunger. Elanco provides employees to help teach animal husbandry.
“It is very personal to Elanco employees, and part of a bigger cause, which is hunger,” Simmons said.

The decision
Simmons highlighted three core points behind the Posilac acquisition:
1) a commitment to a need for wholesome affordable dairy and food products. “In the next 40-50 years, we’ll need to grow dairy and food production 40%-50%.  The (United Nation’s) Food and Agriculture Organization recently reported 70% of that growth will have to come from innovation. That trend is what’s driving Elanco and its stakeholder, Eli Lilly, to invest in the Posilac business.”
Simmons said Elanco’s investment in dairy took a large step five years ago, with the launch of Rumensin for dairy cows in the United States. “This investment is another signal we are serious about becoming a major global player in dairy, and we’re looking for that to continue.”
2) sustainability, science-based technology to enhance food production, while lessening the impact on the environment. Simmons cited a recent Cornell University study which showed Posilac lessened the environmental impact per unit of milk produced. “We believe it is not just the sustainability on the environment, but also on the farm and the food chain.”
3) safety. “We will not back off from the values of this company, which are about ‘safe food’ and enriching life with safe food.
“We start with regulatory bodies: Posilac was approved by FDA 14 years ago,” Simmons said. “Nineteen other regulatory bodies have approved it; the World Health Organization has supported it; Codex has supported it. We looked extensively at all the research. It is proven a safe product. Differences in milk, from a supplemented or nonsupplemented cow, cannot be detected. It’s a natural protein.”

Domestic vs. international markets
Simmons said that because the acquisition was still pending, he could not provide current information on the percent of cows supplemented with Posilac. He stressed, however, that there is market opportunity.
“We’ve  done our diligence, and we’re looking at this globally and here in the United States,” he said. “We have marketed the product outside the U.S. for 10 years, and we see opportunity internationally.”
“Global food needs are growing, so growth opportunities will be in dairy industries abroad,” Erpelding said. “But, the capability to produce – using the genetics and management here in the United States, provides some of the best opportunity to capitalize on global dairy markets right now. Canada and the Europeans have supply management systems, so the U.S. can take technology, use it and become a true global supplier.  In my travels, food supply and security are key issues. Many countries want to do some things domestically, but they’re also looking for reliable import suppliers and, reflecting on recent U.S. dairy export figures, the U.S. is seen as a reliable supplier.”

The controversies
Moving forward with Posilac, “collaboration” will be key, Simmons said. That collaboration will include working with dairy processors and marketers who currently label dairy products as “rbST-free.”
“We’ve done initial assessments regarding ongoing legal actions regarding labeling,” Erpelding said. “We want to take some time to better understand the dynamics and visit with stakeholders in the whole chain to see what their interests are, so we can come to common consensus of how we can advance the issues together from a whole dairy industry perspective.”
“We will not be confrontational; we want a collaboration, and we want to understand what consumers want,” Simmons said. “We’ll be collaborating with regulatory bodies, retailers, fast-food chains, consumer groups -– whether supportive or not supportive of technologies we have. Collaboration has been an ingredient of our success; it’s what our employees and key customers want. With this product, we will have to do that more than ever.
“Second, we respect choices of consumers, retailers and producers,” he said. “It must be nutritious, safe and affordable. The affordability factor is important. After that, there are unique choices: favorite retailers or brands.
“Our company also offers ‘natural’ products, and it drives a value-based approach,” Simmons said. “We have to be able to communicate facts and specifics to influence the food chain and other constituent groups. The choice-driven strategy influences how we’re going to behave.”
Simmons admitted the acquisition of Posilac will increase Elanco’s profile as a potential target for anti-technology activists.
“We’ve chosen this business, and we’ve see this macro trend (increasing dairy and food demand) as more than financial,” he said. “There is a driving need for more dairy in the next 20-40 years than we can supply. Technologies like Posilac, as well as others in our pipeline, need to be a key solution. We understand there will be activists –- there already are against our other products –- and we believe we have the capability to address them. Our No. 1 approach will be to take a collaborative approach up front vs. a reactive approach afterwards. Our global experience with other technologies and other species will help advance our interests in the dairy industry.”
“We are going to have a discussion with processors and retailers,” Simmons said. “We have to learn  the market segmentation of our customers’ customers. We’re in a new (era) of food safety, and it’s important to understand what the consumer wants. That’s an obvious one we have to understand.”
“If you look at the different segments of U.S. market, one thing we’ve seen in other species is that there may be different choices for different segments,” Erpelding said. “Especially if you look at escalating food prices right now – including the meat case and dairy case -– you have certain consumers who want the most affordable supply. You have others who are willing to pay a premium for certain production practices or systems. Our goal, as we work with the dairy stakeholders, is to understand the ‘choice’ option, to make sure we’re providing the maximum opportunity to the different segments – not only on the consumer side, but also the producer side – to capitalize on those different market opportunities.”
Erpelding said Elanco will also sit down with dairy co-ops and others “who have felt between a rock and a hard place on the ‘rbST-free’ controversy. “We need to put this in a global context and the true opportunities for the U.S. dairy industry,” he said.
“We will not go around producers or processors and try to influence consumers and retailers without being aligned with them,” Simmons said. “We’ve learned from experiences –- good and bad –- in Europe and other places, the more alignment we can get with the food chain, the better. To do a confrontational approach is dangerous. Also, trying to tell consumers they don’t understand what they want is another approach we will not take. We’ll respect consumer choices. We understand science will only go so far in today’s world, but we will never back away from that. We will be engaged; we will be proactive; we will continue to take risks, but we will do it in alignment with the food chain.”

Producer relationships
Once the sale is completed, all employees for the Monsanto U.S. operations will be incorporated into the Elanco business. The manufacturing plant in Augusta, Ga. will become part of the Elanco business, as will its employees. At this stage, there will be no change in distribution.
“The first thing we want to do is reach out to the dairy industry and meet with key leaders of producer groups  and hear what they think before we draw up or finalize a strategy,” Simmons said. “We will fine-tune what we have and test  it with them, and that may include a relaunch or adjusted strategy from the course it is on now.
“I don’t want to get into a strategy six to 12 months down the road, but everywhere around the world Elanco has a technical marketing approach, and there are some nice complements (with the Monsanto technical field staff) when it comes to nutritionists  and veterinarians and feed and health,” Simmons continued. “I think we will be able to be a global leader in having that technical background and expertise. When it comes to the productivity and health of a cow, we hope to have the best capability of any animal health company and be a global leader.”

Sale could be completed this fall

Just two weeks after Monsanto announced it would divest its Posilac business, Elanco, the animal health division of Eli Lilly, announced it had signed an agreement to acquire the worldwide rights to the dairy recombinant bovine somatotropin (rbST) supplement, as well as the product’s supporting operations.
Under the terms of the agreement, Elanco will acquire all rights to the Posilac brand, the product’s U.S. sales force and its manufacturing facility in Augusta, Ga. In return, Monsanto will receive a $300 million upfront payment, as well as contingent consideration.
The Posilac dairy business manufacturing and sales teams will be integrated into Elanco.
Under a previous licensing agreement, Elanco has exclusively sold Posilac outside of the United States for a decade. Posilac is approved and marketed in 20 countries.
The transaction is expected to close near the beginning of the fourth quarter of 2008, possibly by early October, contingent upon clearance under the Hart-Scott-Rodino Anti-Trust Improvements Act and other customary closing conditions.

By Glenda Flora

When it comes to maximizing asset value, dairy producers share some principles with other businesses.
For example, a dairy producer can empathize with someone with a pizza business who faces the challenge of maintaining delivery vehicles. Despite best efforts, including changing oil and fixing dents, the vehicles eventually begin to wear out –- some sooner than others. It becomes a balancing act, footing expensive repair bills and taking into consideration each vehicle’s trade-in value.
Dairy producers get better every year at keeping animals healthy and productive, while increasing their efficiency and productivity. But maximizing the cow as an asset includes making sure that when its milk production potential wanes, the cull value is as great as it can be.
Unfortunately, some producers don’t recognize this value, and many certainly don’t maximize it. Every cow will someday become a cull cow. And a few otherwise good producers are neglecting some fairly simple steps to assure a cull cow’s highest sale value.
In the past, producers have accepted the premise that they get little value out of a cull animal. Some view any steps to maximize the cull’s value as wasted, since those steps probably aren’t going to pay off at the sale barn.
But there’s no reason a dairy producer should accept less for their culls than what they are worth. It’s becoming increasingly evident extra value can be obtained for very little additional effort.
The meat from cull cows is no longer just used for ground beef. About 44% of the muscle from cull dairy animals is used as whole muscle cuts. Protecting the integrity of those cuts is more important.
Injection site blemishes in whole muscle cuts lower the value of cull cow carcasses up to $70 each, according to the 1999 National Market Cow and Bull Quality Audit. The audit, which was paid for through thee $1/head Beef Checkoff Program, found 4.2% of all dairy cows showed injection site knots in the round. Making injections subcutaneously in proper locations, away from the round and sirloin, costs no more to do, yet can improve the animal’s value.

Keep them moving
Earlier culling also pays dividends. Cull cows need to be in good condition when they get to the slaughter plant –- especially since downer cows are not accepted for human beef production. Not waiting until the last minute can be the difference between an animal that’s an asset and or one that’s an extra cost.
Proper use of antibiotics prior to harvesting is also important. Antibiotic testing for meat is sometimes more sensitive than for milk, because a cow’s kidneys will hold antibiotics longer. Treatment decisions for sick cows should be made with care – and with plenty of withdrawal time.
One approach is to feed cull cows for a period of time before selling them. The time allows antibiotics that may be still be in the system to be eliminated, while putting additional weight on the animals. Not all producers have the space, labor or facilities to feed cull cows, but in small tests where inexpensive feeds have been used, it has proven profitable.
Producers will find management decisions for cull animals entering their declining years do pay. It isn’t possible to put a precise value on some of the efforts, but no one can deny preventing lameness and utilizing good injection techniques won’t pay off for producers and the dairy industry.
We all want to do the right thing. Dairy producers do it in their milk quality assurance programs. We must look to our beef quality assurance efforts, too. It’s in our own best interests.
FYI
■ Glenda Flora, along with her husband Sam and seven children, owns and operates The Bar F Cattle Co,. Quinter, Kan. The enterprise includes a 100-cowd dairy, a dairy calf growing operation and 200 head of commercial beef cows. She is a member of the Cattlemen’s Beef Board, currently serving as chair of the advertising. She is also a member of the Kansas Cattle Women, American National CattleWomen, American Angus Association, American Red Angus Association and Kansas Farm Bureau.

Dairy state farm real estate, crop and pasture acreage values took another large jump in 2008.

By Dave Natzke

Among major dairy states, the annual increase in agricultural land values and cash rental rates slowed a bit from the record jumps in 2007, except in states where corn and soybean acreage demand added to the competition for land.

Farm real estate
While a weakening U.S. economy slowed commercial and residential development in many regions, federal farm programs, strong commodity prices and favorable interest rates drove farm real estate values to record levels.
Based on USDA’s “Land Values and Cash Rents” report, U.S. average farm real estate values, a measurement of the value of all land and buildings on farms, averaged $2,310/acre on Jan. 1, 2008, up 8.8% from 2007 and a new record high. U.S. average farm real estate values increased 14% in 2007. Among the 23 major dairy states (see Table 1), farm real estate values increases were less than the national average, except in Midwestern corn/soybean states, the Pacific Northwest and Texas. Largest increases were in the corridor from Ohio to Iowa.
The highest farm real estate values remained in the Northeast, where development pressure continued to push the average value to $5,080 per acre. The Northern Plains region had the lowest farm real estate value, at $1,110/acre, up 15.5% from 2007.

Cropland, pasture values
2008 cropland and pasture values also set record highs. Nationally, cropland values rose 10.4%, following a 13% increase in 2007. Once again, increases in some major dairy states were well above the national average, with Illinois, Iowa, Kansas and Pennsylvania all up 15% or more. Across the Lake States and Corn Belt regions, which account for nearly one-third of total U.S. cropland, values ranged from $2,820/acre in Minnesota to $5,320/acre in Illinois. Corn Belt cropland values rose 14.8%, to $4,260 per acre. The Southern Plains region increased 12%, to $1,490 per acre.
U.S. pasture land averaged $1,230/acre in 2008, up 6% after a 16% jump in 2007. Livestock prices, recreational use and urban development remain the predominant influencers.
The Northern Plains had the highest average increase in pasture value, at 19.7%. In the Southern Plains and Mountain regions, which account for more than half of the U.S. pasture land, values increased 17.1% and 6.4%, respectively.

Cropland, pasture rent
For the 2008 crop and grazing year, U.S. average cropland cash rents rose 13%, to $96/acre. The Delta region had the largest percentage increase, up 21% from 2007. Cropland cash rents increased $14/acre, to $140/acre, in the Corn Belt, and $6/acre, to $64/acre, in the Northern Plains. Those two regions account for slightly more than half the U.S. cash rented cropland acreage. Major corn- and soybean-producing states – Illinois, Indiana and Iowa – experienced increases of 13%, 13% and 18% and averaged $160, $135 and $165/acre, respectively.
U.S. average pasture rents increased $1/acre (8.3%), to $13/acre, but there were large regional differences. Corn Belt pasture rent increased $4.50/acre, to to a U.S. high $36/acre. Highest pasture rental rates were in Wisconsin ($43/acre) and Iowa ($42/acre).
The annual June USDA survey of land values and rental rates evaluated nearly 11,000 land areas in the United States.

FYI:
• For the full report on U.S. farmland values and land rental rates, log on to the USDA National Ag Statistics Service reports calendar (www.nass.usda.gov/publications) and click on Aug. 4, 2008.
• For quarterly updates on farmland values in specific Federal Reserve bank districts, visit: www.minneapolisfed.org/Research/data/district/usstates.cfm.

Land prices add to dairy costs

High commodity prices are the main – but not the only – factor behind higher land prices and rental rates, according to ag lenders contacted by DairyBusiness Communications.
Gary Sipiorski, president and CEO, Citizens State Bank, Loyal, Wis., said several factors are driving values in northcentral Wisconsin. Most land is selling in the $1,800-$2,500/acre range, with even poor land bringing $1,500. Much of the interest is coming from Amish and Mennonite families getting squeezed out of the Northeast due to high land prices there. Larger dairies, seeking forage acreage and land for manure, are also buying land.
Bill Needler, senior dairy relationship manager with Rabo AgriFinance, Marion, Ind., said commodity prices, farm programs and interest rates have been favorable over the past 12 months, giving landowners and operators potential for higher profit per acre.

What’s the dairy impact?
Escalating land prices and rental rates – combined with higher energy costs – are adding to milk production costs, Sipiorski said. The increasing land cost is adding to the total investment per cow and debt per cow, reducing return on equity and return on assets.
“It is going to increase our investments in the dairies,” Sipiorski said. “Most of the western states have a minimal investment in assets that are not cows. The increase in Midwest investment will increase our long-term cost of producing milk.”
“Crop input and, consequently, feed costs are now rising, creating a challenge to profitability, particularly for livestock producers,” said Sam Miller, senior vice president of agribusiness & food banking with Marshall & Ilsley (M&I) Bank, Appleton, Wis. “Dairy producers who grow their own feed will face added competition for land from crop producers, who may be able to achieve higher returns by selling grain, as opposed to providing forage for dairy production or renting to dairy farmers.”
Higher feed costs, combined with higher machinery and equipment costs due to higher steel prices, will continue to push variable input and fixed costs into next year, Miller said. As fuel costs increased, nutrient management and manure disposal costs also increased.
“Given the present milk-to-feed ratio, dairies will be challenged to compete for the land for a source of row crop income, feed source and nutrient management,” Needler said.

By Mary Schwarz, Jean Bonhotal and Ellen Harrison
Cornell Waste Management Institute

     Scarcity of bedding has pushed farms to explore different bedding strategies. Use of dried manure solids (DMS) as bedding is being considered by many farms. One of the concerns includes possible elevated levels of environmental pathogens that may negatively affect udder health and milk quality. Cornell Waste Management Institute conducted research to study six farms using different DMS bedding strategies. There were three using DMS directly from the separator, two drum and one windrow composted and one digested/separated (Table 1).
      The research found that sand bedding started out “cleaner” than DMS, but once in the stalls, the bacterial load of several organisms was highest in sand. In addition, DMS with the least bacterial numbers in the unused tended to have the highest bacterial numbers in the used bedding. Bacteria in the unused bedding had little to no effect on bacteria in the used, indicating that bacterial levels in used bedding depend more on bacterial levels in fresh manure additions and stall cleanliness than bedding before it is placed in the stalls. Levels of Streptococcus, Klebsiella and gram negative and positive bacteria were significantly higher on the teat ends of cows bedded on DMS vs. those bedded on sand, but SCC and mastitis for those cows did not differ among bedding materials.
     Mastitis differed among farm/bedding strategies (FBS), but bacteria levels and properties of bedding had no effect on mastitis incidence, while lactation number, stage of lactation and SCC did have an effect. Decreased levels of Klebsiella in the used bedding increased the odds of having an abnormal SCC for one FBS, and decreased moisture and fine particles in the used bedding increased the odds of having an abnormal SCC for a different FBS. For all others, abnormal cell counts were affected only by season, lactation number and milk production.

 Table 1: Description of Bedding Practices at the Six Study Farms

Bacteria in Bedding

An important thing we learned was that just because the level of one bacteria  is high in one type of bedding, does not mean that levels of other bacteria measured will be high, nor will they stay consistently high in that bedding. Therefore, bedding sample analysis for bacterial levels will not necessarily return useful information for enhancing herd health.
      Average levels of Escherichia coli and Klebsiella were very low in all of the unused bedding. There were significant differences between populations of these two pathogens only between sand (significantly less) and two or three of the “green” DMS strategies. There was no E. coli found in unused drum and windrow composted DMS or in sand, and no Klebsiella in unused sand and one of the drum composted bedding materials over the study period.
    E. coli levels in used bedding did not differ (Table 2). Average Streptococcus levels were significantly higher in used sand bedding than in all others except one “green” system. Klebsiella (which was absent from the unused bedding in one of the drum composted strategies) was found in significantly higher levels in the used bedding from that strategy than several other strategies. Although sand started out “cleaner,” used sand had significantly higher levels of the bacteria analyzed (except Klebsiella) than at least one or more bedding types.
     For all bacteria (except Streptococcus), the three Farm E levels did not differ, indicating that bacterial levels in used bedding may be from fresh manure and stall maintenance, rather than how “clean” the bedding is when it is put in the stall. The systems that started out with “clean” bedding tended to have significantly higher levels of bacteria in used bedding indicating the bedding may have started out too clean (i.e. no competition from other bacteria).
    It is often assumed that the cleanliness of the unused bedding has an effect on the bacterial population of the used bedding. But our data suggests that other factors not studied play a more important role.

 Table 2: Average Bacterial Levels in Used Bedding in each Farm/Bedding Strategy (FBS) Over the Study Period on a Volume Basis (log cfu/ml).

Values in each row with different letters are significantly different.

 Physical Properties in Bedding

As expected, moisture and OM in both used and unused bedding were significantly lower in sand than other bedding. Fine particles were significantly higher in used sand bedding and tended to be lower in DMS in deep beds. DMS in deep beds tends to compress from the cows’ weight, and DMS on mattresses falls off, or spreads out.

 Teat Ends

   There were significant differences for Klebsiella, gram negative and gram positive bacteria (significantly higher counts on cows in the DMS pen versus cows in the sand pen) on the teat ends of cows bedded on green DMS and cows bedded on sand. The percent of fine particles in the used bedding had a significant effect (either by itself or in conjunction with other bedding properties and/or bacteria) on the level of bacteria found on the teat ends for half of the bacteria analyzed. Streptococcus, Staphylococcus and Enterobacter levels all decreased when the percent of fine particles increased in the used bedding. Bacterial levels in the used bedding had an effect on several bacterial levels on teat ends, but only in the case of Klebsiella were they the same bacteria. About 32% of cows on DMS had SCC higher than 200,000, as did 36% of those on sand.

 Mastitis

  The odds of getting mastitis for heifers was significantly affected by cell count ( more than 100,000 cells/ml were more prone), while the odds of getting mastitis for cows was significantly affected by FBS, season and abnormal cell count. Bacterial levels and properties of the bedding had no effect on the incidence of mastitis. SCC was a significant variable for all FBS. Stage of lactation, milk production and season also had an effect, but not for all FBS.
    When the three FBS at farm 5 were analyzed together, type of bedding did not have an effect, but the amount of moisture and particles < 2mm in the used bedding, as well as milk production were all positively correlated with mastitis incidence.

 SCC
    The odds of having an abnormal SCC for cows were affected by FBS, season ( less in winter), lactation (more for higher lactations), and stage of lactation (more for increased days in milk). Abnormal cell count for heifers was affected by FBS and season (less in winter). There was a negative correlation with Klebsiella levels in the used bedding (more Klebsiella, fewer animals) for one drum composted strategy, and a negative correlation with moisture and fine particle for the digested strategy. Both of these are opposite what would be expected. Otherwise, it was season, lactation number and milk production.

 Conclusions

    This study suggests that properly managed DMS can provide an economic benefit without compromising herd health. As with any bedding, keeping the stalls free of fresh manure and urine will help insure that DMS bedding is properly managed and will provide cows with a clean, comfortable space in which to lie. In addition, one DMS strategy is no better/different than any other in terms of the product produced, so choose a DMS strategy that is affordable and fits into your normal farm procedures.

Visit our web site for complete study results . http://cwmi.css.cornell.edu

Support was provided by New York State Energy Research and Development Authority, NY Farm Viability Institute, Cornell Cooperative Extension and the College of Agriculture and Life Sciences, Quality Milk Production Services.

 For more information:

• For complete study results: http://cwmi.css.cornell.edu.

• The authors wrote about the economics of dairy manure solids in the June issue of PRO-DAIRY’s The Manager. Find the article at http://cwmi.css.cornell.edu.

• Jean Bonhotal and Ellen Harrison are senior Extension associates with Cornell Waste Management Institute.  Mary Schwarz is a research support specialist with the institute.

EcoSecurities, a leading company in the business of sourcing, developing and trading carbon credits from greenhouse gas emission reduction projects around the world, and Intrepid Technology and Resource (ITR), an Idaho-based company specializing in renewable biogas energy and soil amendment and fertilizer projects, announced the extension of an agreement for the sale of carbon credits from methane gas production at two dairies in southern Idaho.
EcoSecurities started working with ITR in the fall of 2007 to purchase emission reductions from the dairy farms.  EcoSecurities will purchase credits from the project for six years after the first verification, scheduled for later this year.
“We are pleased to continue working with ITR on the purchase of emission reductions from the Idaho dairies,” said Ben Conte, U.S. country director, EcoSecurities, “The Whiteside and Westpoint anaerobic digesters represent milestones for voluntary carbon offsets in the U.S. It is proof that with carbon credits, state of the art waste management and renewable energy technologies can find their way into dairy farms in Idaho.”
The Whiteside and Westpoint Dairies have both agreed to change their system of processing manure, which will capture the methane produced as the waste from over 10,000 dairy cows is broken down by microbes in an enclosed anaerobic digester, and thus, will aid in the mitigation of climate change.
At the southern Idaho dairies, the animal waste digesters process manure in 4-5 days whereby most digesters take an average of 25 days to accomplish the same task. The biogas captured by these digesters contains about 65% methane, which is then processed into pipeline quality gas through a scrubbing process and sold to industrial users for process heating and to the local gas utility for commercial and residential use.
IRT  builds anaerobic digesters at local organic waste sites to capture methane, clean the methane to consumer standards, and distribute the clean gas for sale.

To help farmers meet the increasing demand for hay, Cornell Cooperative Extension of Washington County, N.Y.,  compiled Hay Production Resources for New York and Similar Climates. 
     The resource collects more than 75 articles, organized into 13 chapters. It’s available on a computer CD ($5) or can be downloaded from this website: http://counties.cce.cornell.edu/Washington (click on “Agriculture” and find it under “Highlights”). 
    There are articles explaining principles and practices covering agronomy, machinery, drying hay, risk management, hay quality and livestock feed requirements and even hay for bioenergy.  “The market for hay is strong and customers are demanding a high quality product,” said Aaron Gabriel of Washington County Extension.  “This resource will help farmers capture the opportunity of a strong hay market.”
   Contact Gabriel at 800-548-0881.

By Susan Harlow, editor, Northeast DairyBusiness

    Larry Martin, a Bradford, Vt., dairy producer, hasn’t purchased commercial fertilizer, even starter fertilizer, for four years. Manure and nutrients from a cover crop of winter rye provide his 21-acre corn crop with whatever it needs for good yields.
   There’s a lot of encouragement these days for cover crops on cropland. The Vermont Agency of Agriculture is offering growers an incentive payment of $30 an acre to plant a cover crop of annual rye this year. The White River Natural Resources Conservation District (NRCD)  is supplementing that payment with $5 an acre in selected towns along the streams in its area.
  A cover crop provides several benefits:

• Erosion control

• Uptake of nutrients in the fall and early spring that will be available to next year’s crop, after the rye is incorporated as green manure.

• Improved organic matter

• Weed suppression

• Good public relations with the nonfarm public.

            With extra nutrients from cover crops, the cost in fuel and time for tillage may easily be offset by the savings in nitrogen costs these days. Producers in much of northern New England have been slow to adopt cover cropping because late corn harvests and labor shortages have made it tough to get rye seeded in time for sufficient growth before winter. But the development of short season hybrids is making that easier, says Tim McKay, Natural Resources Conservation Service district conservationist.
    Martin has been using cover crops for 10 years. “I think it’s well worth the trouble,” he says. Last year, it cost him $40 an acre to seed winter rye at about 100 lbs. per acre. He has the rye custom-seeded after harvesting corn in the fall. The rye usually get 3 to 4 inches of growth by winter. In the spring, around the first of May, he spreads manure on the rye, then harrows it down.

For more information on the NRCD program, contact Abbey Willard, White River NRCD, 802-828-4493, Ext. 110, or Suzanne Enser, Ex. 112.
For information on the Farm Agronomics Practices program at Vermont’s Agency of Agriculture, Food and Markets, call Matt Kittredge, 802-828-6908.

 For more information on cover crops, go to:  http://pss.uvm.edu/vtcrops/articles/CoverCrops_for_CornSilage_FS.pdf

 Choose a cover crop

A new online decision tool from Cornell University can help you choose a cover crop. It gives the user information on cover crops based on management goals, planting time and/or duration. It includes different cover crops and production instructions.
The cover crop tool is designed to complement the new Cornell Soil Health Test. Find it at http://tinyurl.com/NyccTool.