This week in DairyProfit Weekly

This week in Dairy Profit Weekly:

1) LGM-Dairy: USDA’s Risk Management Agency increased funds available for the Livestock Gross Margin for Dairy (LGM-Dairy) insurance pilot program. The program allows producers to insure a margin between feed costs and milk income. Recent program popularity stretched USDA premium subsidies and underwriting capacity by some coverage providers.

2) Commercial dairies: Commercially licensed U.S. dairy operations totaled 53,127 in 2010, down about 1,805 (3%) from 2009’s total of 54,932. Looking at 5-year trends, the number of U.S. commercially licensed dairies declined about 18% since 2005, from 64,540 herds. The 2010 total is down about 28% from the 74,100 commercial dairies in 2002, the first year USDA reported numbers.

3) DPW Trends: January 2011 milk production, cow numbers and cow culling were up from the year before.

4) DPW Industry: One recommendation coming from USDA’s Dairy Industry Advisory Committee urges research into what impact establishing higher national total solids standards in fluid milk would have on milk consumption, milk prices and dairy farmer income. A study commissioned by the California Milk Advisory Board may provide some answers.

5) DPW Washington: Federal Reserve district banks reported sharply higher farmland values, and the increase has caught the attention of the Federal Deposit Insurance Corporation. Rabobank says recent price declines in grain futures are counter market fundamentals, and may send the wrong signals for 2011 acreage needs.

Dave Natzke, Editor

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