Monday, December 14, 2009

Gaming the System

(click on image to enlarge)

If you go to:

you will find the link for the above image.

Notice the Class III utilization for November in FMMO 126. Within FMMO 126 are two of the largest cheese plants in the country - Southwest Cheese and Dalhart Hilmar. Together, the plants have a capacity of nearly 8 million pounds of milk a day - that's right a day. How can the 23 million pounds for class III be explained?

Then notice the class I % - over 72%. In November of 2006 the amount was 37%. There is more milk produced in FMMO 126 with no appreciable gain in population when compared with 2006.

With a big class I utilization you would think there would be a good mailbox price. Not so. New Mexico producers , for September 2009, received $2.51 under blend price.

FMMO 126 is just one of the more outstanding examples. Probably in most orders, most of the time, there are some shenanigans going on.


  1. Our trusting nature will be our ruin... our Achilles heel if you will. You know I think 1954 was the first year that more tractors were used than horses - 55 short years ago. The use of tractors surely would explain more land being planted but not less farmers? Betrayal and malicious manipulation to keep profit just out of reach, and farmers in the poorhouse, that would explain less farmers. Seems nothing in this business is eternal except this thievery that we for some reason we tolerate?

    The Gotti family might not be as bad as some of the people we're dealing with.

    Will we ever say enough is enough? Or will we stand by and continue to witness the destruction of this industry?

    My guess, the latter.


  2. Jeff, there are too many in our industry that are merely appeasers. definition: an appeaser is the one who feeds the alligator, hoping it will eat him last. Too many continue to believe that we are each other's competition and because of that will gladly watch their neighbor go down. The only time there will be unity is when there is only one producer left and if he's the indecisive type....DWCovert

  3. You are ever so right DWCovert; but to what end? Why do we insist on this economic and maybe even social suicide? Surely not in the name of the "free market" as this is anything but free.
    Not so long ago most dairymen were for the most part ethically sound with high morals - ready to help his neighbor in time of need, but for some reason in some folks this has all but disappeared.
    I feel as if many of us are on a leash of sorts or maybe it's a noose - ever tightening by our refusal or inability to act.
    I haven't given-up hope... but again DWCovert you are ever so correct; many have been brainwashed and see who should be his friend as his opponent and his rival he views as his ally. Smaller farms hate big farms - east coast against west coast and so on - this all must stop.

    "We must all hang together or assuredly we will hang separately".
    Ben Franklin

    Who knew how right he would be?

  4. We only need to look at our land grant university system. They teach the vets, extension agents, nutritionists, bankers, agronomists,consultants,and worst of all the dairy "executives"(note not farmers)to all think alike, aka drink the koolaid. The situation this industry is in is the direct result of this like minded thinking. When you dig a little deeper and see that this is what the government has wanted since the early 60's, the connection becomes more obvious. Being placed up against the wall has lead us near the point of desperation. As people get closer to it they will sacrifice ideals and principles to survive. Its human nature. Thing is the ones behind all of this, I believe, know this and rely on us to react the way we do. We play right into their hand. Any time there has been organized resistance it has been put down, by any means neccesary, to mantain status quo. There is too much money involved not to. remember money=control, control=power. We have the ultimate power in that we are the ones who create wealth. Problem is we don't know how to harness that power. That is why the coops have been able to gain control and look what that has done to us.DWCovert

  5. Getting back to that class 3 utilization above, obviously there is no possible way that 4% was used for cheese. That would be an average of about 7 3/4 trucks a day BETWEEN Southwest and Hilmar. They wouldn't even open a silo for that small an amount. Even the publication of this knowledge doesn't sway these felons. Look how long illegal MPC imports have been in the marketplace and the blind eye just gets blinder.Skip

  6. Where could the milk possibly be going to get 72% fluid utilization? Maybe the southeast to crash the premiums?

  7. Once again DW you're correct in your second comment. But we need to change this ourselves (dairy farmers) nobody else will or can do it for us. Where others have failed in the past we must succeed. We have to learn from their mistakes and capitalize on our strengths. We no longer need to organize a quarter million farmers as only about 50,000, or so, of us are left; already our task is lessened. Maybe soon the "moo flu" will be more feared than the ever elusive BSE that we have spent so much time and money on (to no good end).

  8. Whoa guys! This is simply what De-Pooling looks like on paper. Very common in the Western areas. Cl3 went up Cl1 stayed down so the plants did not report the cl3 sales since they did not want to pay into the pool. Then they coul dcapture more money for themselves. Happens here about 3-4 times a year. Mainly in low cl1 utilization areas. Since they dont report cl3 they dont pay in so the formula gets bent and dairymen get the same. Tillamock does it constantly when they need a littl eextra cash for operating. They pool or un-pool 20k cows in E. Or at will. the FMMO thought that this spring the PNW(124) had 17% more milk then in 08. The plants were all running about 70% capasity?!?! Tilla added the 20k into the books and paid in so they could get paid back with the "new" blend. Why the FMMO needs tweaks and make(take)-allowances need to sink.