Tuesday, October 27, 2009



The Dairy Export Incentive Program (DEIP) helps exporters of U.S. dairy products meet prevailing world prices for targeted dairy products and destinations. Under the program, the U.S. Department of Agriculture pays cash to exporters as bonuses, allowing them to sell certain U.S. dairy products at prices lower than the exporter's costs of acquiring them. The major objective of the program is to develop export markets for dairy products where U.S. products are not competitive because of the presence of subsidized products from other countries.

Here is the latest condition as reported by Dairy Market News:


BUTTER/BUTTEROIL: European butter markets and prices are firm. Butter prices
have reached levels not seen since late last summer. Butterfat is in tight
supply and very competitive. Butter stocks are also limited and clearances to
intervention and PSA have virtually stopped.

Prices in Europe, according to DMN for butter adjusted to our 80% butterfat standard are $1.87 per pound. Butter, today, at the CME is $1.35 per pound.

USDA yesterday, announced a DEIP bonus:

WASHINGTON, Oct. 26, 2009 -- The U.S. Department of Agriculture's Commodity Credit Corporation today accepted a bid from an exporter under the Dairy Export Incentive Program for anhydrous milkfat to Africa and Middle East.

The award totaled 100 metric tons of anhydrous milkfat.

Delivery period: Nov. 20 - Dec. 30, 2009
Bonus: $450.00 per metric ton
Remaining global DEIP balance: 3,765 metric tons butter equivalent

CCC's bonus was awarded to Burt Lewis International Corp.

The links on the food chain show the average butter price on the CME for the first nine months of 2009 was $1.192 per pound. Someone, unnamed converted the butter to anyhydrous and a broker gets a bonus of $450 per metric ton. Meanwhile, the dairy farmers producing the milk which made the product were paid a price which did not cover costs.

Farmers then worry and fret about "government handouts."


  1. Oh John;
    This is just further evidence the "free market" working to the satisfaction of the "gentlemen" in suits that we peons work for...
    A friend told me last night a mutual aquaintence,(who's otherwise smarter than this!!) told him he had been to some meeting featuring DFA's "Tricky Rick Smith"... seems Rick gave the impression of being somewhat bewildered and demoralized, (TOO BAD, OH, TOO, TOO BAD!!!)(my heart's pumpin' peanut butter here!) Our friend's much worried about his god with feet of clay; hope's Rick will find the inter resources to rally and lead DFA to brighter days... (heaven forbid!!)
    That's 'bout all I got... later, Nate Wilson

  2. Not only does Burt Lewis International Corp. export, they hold an import license too..


    Burt Lewis International Corp. has partnered to form an ingredient company...


    Milk Protein Concentrates...is there a way to find out how much of this they import?

    Interesting, if you go to the web site and click on the products, specifically the hydrocolloids, under the mannans,


  3. I gotta tell you, I am so glad you started this blog. I literally learn something every single day. Plus it is kind of like having a cheering section telling you that you are not the bad guy in this miserable pricing situation. Thanks.