DairyBusiness Update for Feb. 20, 2013
January 2013 U.S. milk production was estimated at 17.10 billion lbs., up about 0.5% from a year earlier, according to USDA’s monthly milk production report. Cow numbers were estimated at 9.225 million head, up 7,000 from December 2012, but 17,000 fewer than January 2012. January 2013 output per cow averaged 1,854 lbs., up 13 lbs. from a year ago.
January 2013 milk production in the 23 major dairy states totaled 15.9 billion lbs., up 0.6% from January 2012. Production per cow in those states averaged 1,871 lbs., 11 lbs. more than January 2012. Cow numbers were estimated at 8.50 million head, up 6,000 head from December, but 2,000 less than January 2012.
Cow numbers: In the major dairy states, only Arizona and Texas (each +2,000) and Indiana, Kansas and Ohio (each +1,000) posted gains in cow numbers in January 2013 compared to December 2012. New Mexico and Virginia (each -1,000) were the only states to post declining cow numbers.
Compared to a year earlier, New Mexico cow numbers were down 15,000, with Pennsylvania down 5,000 head, and California and Virginia each down 2,000 head. Kansas (+9,000), Michigan and Wisconsin (each +5,000) and Colorado (+1,000) posted the largest gains.
2012 totals: With December revisions, total 2012 U.S. milk production was 200.3 billion lbs., 2.1% more than 2011. The average number of U.S. milk cows was 9.23 million head in 2012, up 39,000 (0.4%) from 2011. Production per cow averaged 21,697 lbs. for 2012, 361 lbs. more than 2011. The average annual rate of milk production per cow has increased 15.7% from 2003.
The National Cattlemen’s Beef Association (NCBA) said it was notified by the U.S. Environmental Protection Agency (EPA) that information collected from states on concentrated animal feeding operations (CAFOs), at the request by extremist groups through a Freedom of Information Act (FOIA) request, has been granted to them. Making the request were Earth Justice, the Pew Charitable Trust and the Natural Resources Defense Council.
The information released by EPA covers CAFOs in more than 30 states, including many family farmers and ranchers who feed less than 1,000 head and are not subject to regulation under the Clean Water Act, according to NCBA.
“When we reviewed the information submitted by the states and released by EPA, we were alarmed at the detail of the information provided on hard-working family farmers and ranchers, family operations including my own,” said NCBA past president J.D. Alexander, a cattle feeder from Pilger, Neb. For some operations, even telephone numbers and deceased relatives are listed, he said.
In January 2012, EPA proposed the Clean Water Act Section 308 CAFO reporting rule to collect information from CAFOs and make it publicly available and readily searchable through their website. Cattle producers, along with the Department of Homeland Security, expressed concerns that this was not only a serious overreach of EPA’s authority and would create a road map for activists to harass individual families, but that the proposal would aid and abet terrorism and provide a very real threat to the nation’s food security. EPA later withdrew the 308 rule.
Last year’s milk/feed economy slowed the nation’s overall trend in changing dairy herd structure at least a little, according to estimates provided in USDA’s annual review of farms and livestock operations.
First, the trend that didn't change: U.S. dairy herds declined during the year, down 2,000, to 58,000. In terms of real numbers, the decline isn't out of the norm for the past several years, with annual declines in a range of 2,000 to 2,500 since 2008. And, as a percentage of herds, the 2012 decline was about 3.45% of the total U.S. herds, also in line with the past four years.
What did change in 2012 is that even the largest herds were not immune from declining numbers.
For the first time in three years, herds of 200-499 cows declined, down 200, to 3,800. Herds of 500-999 cows declined by 80, to 1,570 and, probably for the first time ever, the very largest herds herds (2,000+ cows) declined from the year before, down 20, to 780.
As a result, the percentage of cows and the percentage of milk produced by the nation’s largest herds changed little last year. Herds of 500+ cows represented about 5.7% of the nation’s total herds, contained about 59% of all U.S. dairy cows, and produced about 63% of U.S. milk.
As always, a disclaimer on the USDA estimates: USDA figures probably understate the percent of U.S. herds in the largest size categories, since the agency includes all dairy operations with even one cow during the year. For example, in 2011, USDA said there were 60,000 operations with cows, but just 51,481 were commercially licensed to sell milk, down 1,651 from 2010. The estimate for 2012 commercially licensed dairies should be released later today (Feb. 20).
To see the USDA report, Farms, Land in Farms, and Livestock Operations, 2012, visit http://usda01.library.cornell.edu/usda/current/FarmLandIn/FarmLandIn-02-19-2013.pdf
Next LGM-Dairy policy sale is Feb. 22-23
The next sales period for Livestock Gross Margin-Dairy (LGM-Dairy) income margin insurance is Feb. 22-23, according to Alan Zepp, Risk Management Program coordinator with Pennsylvania’s Center for Dairy Excellence.
Zepp said current insurable margins are running well above 5- and 10-year average margins for the covered in this sales period. For further information, producers can contact Zepp at email@example.com or phone 717-346-0849.
Dairy producers can also find an LGM-Dairy specific agent on the LGM-Dairy website maintained by Prof. Brian Gould (firstname.lastname@example.org) of the Department of Agricultural Economics at the University of Wisconsin-Madison (http://future.aae.wisc.edu/lgm_dairy.html). The LGM-Dairy Analyzer software system contained within the software section (http://future.aae.wisc.edu/lgm_analyzer/) is being used extensively across the U.S. by insurance providers and dairy farm operators to help plan for LGM-Dairy contract offering, and to examine the performance of previously purchased contracts.
MARKETS: Blocks, Class III futures lower
Today's market closing prices:
Butter: unchanged at $1.6050/lb.
Cheddar blocks: down 2.0¢, to $1.6450/lb.
Cheddar barrels: unchanged at $1.63/lb.
Grade A nonfat dry milk: unchanged at $1.5050/lb.
Extra Grade nonfat dry milk: unchanged at $1.56/lb.
Class III milk: -1¢ to -22¢ through January 2013. Based on current CME closing prices, the 2012 average is $17.44/cwt.; the 2013 average is $17.90/cwt.; and the 2014 average is $16.42/cwt.
Corn, soybean and meal futures higher
Corn: +2¢ to +5¢ per bushel through December 2013. The 2013 average is $6.44/bu.
Soybeans: +11¢ to +14¢ per bushel through December 2013. The 2013 average is $14.09/bu.
Soybean meal: +$6.80 to +$8.30/ton through December 2013. The 2013 average is $399.93/ton.
Today in DairyBusiness Weekly:
1) Best of the West: World Ag Expo Forage Challenge winners selected
2) Prevent ‘industrial espionage’: Screen potential employees to avoid hiring animal rights activists
3) 9th Midwest Dairy Challenge draws 79 students from 19 universities to Manitowoc, Wis.
4) Dairy trade: Mixed signals… Global U.S. dairy product sales set records, but weakened in last half of 2012
5) Federal order a possibility for California dairy producers, among topics discussed at World Ag Expo
6) 37th International Osnabrueck Black & White Days results
7) 50th All-American Dairy Show anniversary line-up announced
8) Opinion: 2012 numbers are in, and it’s time for producers to stand up for change
9) Seen & Heard: Genomics are here to stay; Fort Worth results; DCRC Award nominations due; CBO baseline for dairy
10) See what’s happening on social media, listen to podcasts, and much more!
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