Friday, August 7, 2009

Good News?

(click to enlarge)

Good news! Cheese and NFDM prices are rising.

There are at least two important questions. One, will prices reach the necessary level? And, two, will the price level be sustained for a long enough period to convince bankers they can once again loan money to dairy farmers?

Well, maybe there are more. Will dairy farm expenses rise at the same rate, canceling out the increased farm milk check (see graphs)?

The batteries are shot on all crystal balls.


  1. Yippee skippee... note the sarcastic overtones. OK I don't need a crystal ball for this one. IMHO here are the answers.

    #1. No... with all the debt that this mess has incurred I don't think so. Thanks to DFA, Dean Foods, and everyone else involved. Right now there is no amount of money that can be made to bail us out before the next crash of milk prices. Unless someone (in the government) finally does something.

    #2. See above. It will take a miracle.

    #3. They already are... anyone noticed the price of Soybean meal, distillers, corn, wheat mids and cottonseed meal this past week? Where I'm getting my feed now told me that if it keeps up, they can't afford to bring me feed. So now I'm stuck at rationing feed and finding somewhere else to go.

    Truth is stranger than fiction.

  2. Very well stated Miss Sara. I would like to add a few more thoughts for everyone to ponder; Cheese and powder prices go up after the support levels are raised, yet very little powder and even less cheese (if any) move to government warehouses. The price of cheese/powder hovered at or very close to support prices for months. One could argue that the increase in government support prices should have sent a slug of product to the government, taking some excess dairy products out of the marketplace, this in turn causing the prices to rise (I believe this was the original intent of the support prices). However this didn't happen, most all the "surplus" dairy products are in private warehouses.
    This market stinks on ice, but we've been hoodwinked for so long that I think we're believing most everything that's spoon fed us by these nimrods. Now that many of us relize that we're being ripped-off, we're either too proud or too ashamed to admit that we've become mere peasant slaves to the traders and processors who control what should be our market. Will we ever get the balls to take back what is ours and do something to secure the dairy industry in this country? I hope so...
    Jeff Suehring

  3. The good news accompanied followed a federal raise in the support price. For the smaller producer this may not be a price increase; nothing at all because the MILC payment will decline. It will help those who have topped out the 3 million pounds and do not receive this anymore; and if they elected these month's for payment they may not be helped either! And who thinks that 3 month's of higher prices is going to help; I have always figured it takes 2 times as long to climb out of a period of poor prices and they lasted. This has now been since post 2008 fall elections; therefore by my calculations we need very good prices for at least 18 months or longer.