Friday, December 17, 2010

November Milk Production

(click on image to enlarge)

Today USDA released its "Milk Production" report. The report showed, surprise, surprise, that milk production was up in November 2010 by over 3%. The numbers can be argued until the cows come home. The numbers are not a precise measurement. Exact numbers are very difficult to come by.

There are some, many quite a few, who think all we need is supply management and the farm milk price will rise magically. First off, if the numbers are not precise, how can the supply be managed?

Perhaps more importantly, there is a genuine need for a small surplus. Milk supply varies day-to-day. But, the consumer expects to find the dairy product on the shelf. To insure the consumer is always supplied requires extra production.

The real problem is not the small "surplus," the real problem is the small surplus is the excuse to undercut dairy farm milk prices.

Essentially, the problem is a moral problem.


  1. What shocks me still is how in this 'age of computers' we can't have up-to-date, ACCURATE, and COMPLETE information. This includes: cow numbers, slaughter numbers, plant receipts, inventories, and sales.Instead we get the 23 state guesstimate. No business (or industry) can operate for very long without accurate information. Its no wonder we are in this shape.

  2. There may be a bigger picture. This is not about price, reporting or supply management anymore. Look at subtle changes in the direction of our govt. over the past ten years. Take China for an example. Since bankrolling our govt., we no longer issue statements condemning the Chinese for anything. Not that many years ago our country was the voice of freedom around the world. We condemned countries like China vocally on a fairy regular basis. That just doesn’t happen anymore. It is a subtle difference but recognizable.

    The same might be said for animal agriculture in the U.S. It appears that all Livestock agriculture is under a very subtle attack in this country. I sense a shift in policy to move from livestock agriculture to virtually all grains that can be exported. Look at recent laws that have been passed in California and other states regarding chicken production and how much of that is moving to China and Mexico. Third world countries are importing cattle in record numbers to increase their respective herds. While this happens, the U.S. Dairy Producer receives less than the world market price forcing thousands out. Subtle changes go unnoticed by many but the carnage ads up over time. The Immigration Service appears to be ratcheting up on farm raids. DEP, CAFO’S, DEC, etc, etc. are becoming more problematic for all livestock production farms in the U.S. Subtle differences that started as a hurdle have over time, become mountains.

    As the world population expands so does the need for more small grains. The U.S. with its vast abundance of adequate rainfall in most parts of the country and aquifers in the western states is the perfect nation to increase production of corn, wheat, soybeans, etc.

    If one studies the subtle changes you begin to realize that livestock production in the U.S. is really under assault. Recently, a Turkish dairy cattle buyer advised us that the price in Turkey for milk was over thirty dollars/cwt. Bull calves at two months of age are about $900. Cull dairy cows fetch $2,000.00 or more.. If we live in a world where price dictates demand, why are they not importing all their dairy products and beef from the U.S.? Even with shipping, they could buy and deliver dairy products cheaper than they could produce them.

    It’s not about price anymore, it’s about the subtle shift in livestock production away from the U.S. and as producers we should all understand this. A much bigger picture is appearing here and the entire U.S. livestock industry better take notice.
    Dave Rama