Digest Highlights Dairy-RP activity tops 2.6 billion pounds of milk INDUSTRY: FDA approves Experior for reduction of ammonia gas released from beef cattle manure Chobani launches campaign to benefit military veterans Prairie Farms to add baghouse to Iowa plant, pays penalty Saputo enters ultrafiltered milk market with JOYYA Kraft Heinz Canada selling natural cheese business to Parmalat Darigold names Garth to financial post Dean Foods holds quarterly investor call POLICY: FarmFirst asks USDA to increase trade mitigation payments for dairy Groups endorse agribusiness merger moratorium bills STATES: WSDA awards dairy nutrient management grants Michigan dairy promotion award nominees sought CDE offers dairy advisory team grants Minnesota Milk hosting annual Dairy Conference and Expo

Natzke dave
Editor / Progressive Dairy

Dairy-RP activity tops 2.6 billion pounds of milk

Activity in the Dairy Revenue Protection (Dairy-RP) program moved into the program’s second month, with revenue now protected on about 1 percent of anticipated 2019 milk production.

Based on information from USDA’s Risk Management Agency (RMA) as of Nov. 12, 673 dairy producers had filed applications in 28 states (Table 1). A reminder: Dairy producers apply for a Dairy-RP policy, but purchase coverage, called “endorsements,” on a quarterly basis.

Of the applications, 208 quarterly endorsements had been purchased, covering 2.68 billion pounds of milk. Total premium costs on purchased endorsements were about $9.5 million, with USDA RMA subsidies covering about $4.1 million of that.

dairy rp costs

INDUSTRY: FDA approves Experior for reduction of ammonia gas released from beef cattle manure

The U.S. Food and Drug Administration (FDA) approved Elanco’s Experior, a medicated feed additive designed to reduce levels of ammonia released in beef cattle manure. The product is not labeled for use in dairy heifers or cows.


Experior may be administered in feed to beef steers and heifers fed in confinement for slaughter during the last 14 to 91 days on feed. There is no withdrawal period.

Studies of Experior indicated that the product partially reduces ammonia gas emissions from manure from an individual animal or a pen of animals in semi-controlled conditions in enclosed housing. The studies did not measure ammonia gas emissions on a herd or farm scale and could not take into account other factors that may affect ammonia gas emissions, such as wind speed and direction, rainfall, weather, input from other nitrogen sources and manure management.

The studies did not demonstrate any health benefit or performance advantage in beef cattle, such as weight gain or feed efficiency, and no negative effects were noted.

Chobani launches campaign to benefit military veterans

Chobani is using its Hero Batch “Red, White and Blueberry” Greek yogurt in a campaign to benefit U.S. military veterans.

The campaign, launched on Veteran’s Day, seeks to raise $1 million for Operation Homefront, a national nonprofit organization serving America’s military families. Chobani will donate $500,000 and match consumer donations of up to $250,000.

For more information and to donate, visit Chobani’s Operation Homefront website.

Prairie Farms to add baghouse to Iowa plant, pays penalty

Prairie Farms Dairy will pay $100,000 in penalties and agreed to install $1.4 million in pollution-control equipment at a Swiss cheese plant in Luana, Iowa, according to a consent decree released by the Iowa attorney general’s office.

The plant formally operated under the name Swiss Valley Farms. Prairie Farms and Swiss Valley merged in April 2017.

The state alleged in a petition that in 2004, a baghouse, an air pollution control device designed to remove whey particulate matter, was removed. The Iowa Department of Natural Resources discovered in 2013 that the baghouse had been removed without a construction permit.

According to the decree, a dryer stack fan was added to the plant in 2016, putting it in compliance with applicable emission limits since then. As part of the consent decree, Prairie Farms agreed to install the baghouse by the end of 2019, to further reduce particulate matter emissions significantly below permitted limits.

Saputo enters ultrafiltered milk market with JOYYA

Taking on plant-based beverages and premium fluid milk competition from the U.S., Canada's Saputo has launched JOYYA, an all-Canadian ultrafiltered (UF) milk. Saputo said 100 percent of the milk for JOYYA is sourced from Canadian dairy farmers.

Kim-Tuan Nguyen, Saputo’s vice president for strategic business development for fluid, bottling and culture products, said the new product addresses the demands of Canadian consumers. A year-long nationwide survey, commissioned by Saputo and conducted by Maru/Blue, found 87 percent of Canadians still drink or cook with milk regularly, and 40 percent consume it daily. Among other findings:

  • 43 percent of Canadians choose milk for its protein, but almost one third of those surveyed wished milk had more protein.
  • The biggest reason for trying milk alternatives was curiosity, but over a quarter of survey respondents were seeking an added source of protein, even though most common plant-based milk alternatives have less than 3 grams of protein per 250 milliliter serving. While more than half of Canadians have tried milk alternatives in the last five years, 75 percent came back to regular milk.
  • 91 percent of people surveyed wanted to purchase milk produced on Canadian farms.

Two years in the making, JOYYA is being rolled out through Canada's community grocery stores and independent specialty stores. It is available in 1-liter bottles in skim, 2 percent (white and chocolate) and whole varieties: All regular milk varieties contain 75 percent more protein and 25 percent less lactose (sugar) than regular milk, and 16 grams of protein per 250 milliliter serving. The chocolate variety contains 75 percent more protein and 50 percent less sugar than regular chocolate milk, and 15 grams of protein per 250 milliliter serving.

Unopened, JOYYA has a shelf life of 120 days from the production date. Once opened, it is recommended that JOYYA UF milk be consumed within 14 days.

Last June, Coca-Cola Canada and U.S.-based fairlife LLC announced a joint venture plan to build a fairlife UF milk production facility in Peterborough, Ontario. Coca-Cola Canada will invest $85 million ($ Canada or $65.7 million U.S. dollars) in the facility, scheduled to start operations in the first quarter of 2020. Coca-Cola Canada said it was working with Dairy Farmers of Ontario (DFO) to supply milk for the facility.

Kraft Heinz Canada selling natural cheese business to Parmalat

The Kraft Heinz Company has agreed to sell its Canadian natural cheese business to Parmalat for a purchase price of $1.62 billion ($ Canadian or about $1.23 billion $ U.S.).

The agreement includes the sale of natural cheese brands Cracker Barrel, P’tit Quebec and aMOOza! in the Canadian market. Those brands had 2017 net sales of approximately $560 million ($ Canadian or about $427 million $ U.S.).

Under the terms of the agreement, Kraft Heinz will sell its production facility located in Ingleside, Ontario. The proposed transaction is expected to close in the first half of 2019, subject to regulatory review and approval.

Kraft Heinz, the fifth-largest food and beverage company in the world, will continue to own and market its other cheese products, including Philadelphia, Cheez Whiz and Kraft Singles, which are processed in Mount Royal, Quebec.

Parmalat Group is a global company with facilities in Europe, the Americas, Africa and Oceania. Parmalat Canada has 16 manufacturing sites and dairy brands such as Beatrice, Lactantia, Astro, Black Diamond and Balderson.

Darigold names Garth to financial post

Darigold, the marketing and processing subsidiary of Northwest Dairy Association (NDA), named Mark Garth as its new chief financial officer and treasurer, effective Nov. 27.

Garth most recently served as the chief financial officer for Country Fresh Holdings LLC in The Woodlands, Texas. Prior to joining Country Fresh, Garth was served in similar capacities at Perdue Farms, Maryland, and Wells’ Dairy, Iowa.

Headquartered in Seattle, Darigold is owned by nearly 500 dairy farm families in Washington, Oregon, Idaho and Montana. Darigold handles approximately 10 billion pounds of milk annually, operating 11 plants that produce a full line of dairy-based products for retail, food service, commodity and specialty markets.

Dean Foods holds quarterly investor call

Costs associated with seven plant closures, including redistributing milk volume into 23 other locations within six weeks, cut into Dean Foods’ bottom line, Chief Executive Officer Ralph Scozzafava said in a quarterly investor call, Nov. 7.

Reported net sales of $1.9 billion for the quarter ending Sept. 30, 2018, were down about $43 million from the same quarter a year earlier. Citing continued costs with plant consolidation efforts, retailers continued investment in private label and higher than expected transportation-related inflation, Dean reported a net loss of $26 million for the quarter.

Plants closed in Huntley, Illinois; Louisville, Kentucky; Thief River Falls, Minnesota; Lynn, Massachusetts; Erie, Pennsylvania; Braselton, Georgia; and Livonia, Michigan.

Dean no longer reports its quarterly average price paid for milk.

POLICY: FarmFirst asks USDA to increase trade mitigation payments for dairy

FarmFirst Dairy Cooperative has joined the call for more trade mitigation assistance for U.S. dairy farmers. John Rettler, president of the Midwest-based co-op, sent a letter to U.S. Ag Secretary Sonny Perdue, requesting the payments to U.S. dairy farmers more accurately reflect the cost of the retaliatory tariffs placed on U.S. dairy products.

The initial round of Market Facilitation Program (MFP) payments to dairy farmers totaled $127 million, or 12 cents per hundredweight on one-half of historical annual production. Rettler cited recent data showing U.S. dairy farmers suffered as much as $1.5 billion in financial losses.

Read: NMPF asks USDA to bolster dairy aid package

“Dairy farmers have endured exceptionally low milk prices over the last several years; specifically, 18 percent lower from 2015 to 2017 compared to the average price farmers received from 2011 to 2014,” Rettler said. “Farmers were managing through this low point and believed the markets would come around.”

The opportunity for dairy farmers to recover from these low prices was spoiled when the dairy markets reacted after retaliatory tariffs were imposed, Rettler said.

At the end of October, Perdue said a second round of MFP payments would be issued, likely beginning in December. It’s widely assumed the payments will be the same as the first round. Perdue also said there are no MFP payments planned for 2019, saying he believed markets lost to retaliatory tariffs will be restored, and trade agreements with other countries will enhance trade.

Groups endorse agribusiness merger moratorium bills

More than 200 farm, food, rural, faith and consumer advocacy organizations delivered a letter to Congress endorsing food and agribusiness merger moratorium bills and urged members of the House and Senate to co-sponsor the legislation.

U.S. Sen. Cory Booker (D-New Jersey) and U.S. Rep. Mark Pocan (D-Wisconsin) introduced the Food and Agribusiness Merger Moratorium and Antitrust Review Act of 2018 companion bills earlier this year. These bills would impose an 18-month moratorium on mergers between large agribusiness, food manufacturing and grocery companies.

The letter contends as wave of consolidation has contributed to falling farm prices, declining farm incomes, stagnant wages for food workers, raising food prices and economic stagnation in rural communities. The bills would establish a commission to study the impacts of consolidation in the food and agricultural sectors on farmers, rural communities and consumers.

STATES: WSDA awards dairy nutrient management grants

The Washington State Department of Agriculture (WSDA) named eight recipients of water-quality project grants totaling more than $35,000.

Program funding comes from the Livestock Nutrient Management Account, which collects fines issued to dairies for improper recordkeeping or manure management. Grants are awarded to conservation districts, universities or other interested parties proposing research or education projects to help dairies comply with state and federal water quality laws.

Organizations receiving grants include the Snohomish, Whatcom, Skagit, South Yakima and Underwood conservation districts, as well as Organix Inc. and Washington State University.

WSDA’s Dairy Nutrient Management Program (DNMP) works with Washington dairies to make sure they handle manure in ways that minimize the risks of impacting groundwater or surface water quality.

Michigan dairy promotion award nominees sought

The United Dairy Industry of Michigan (UDIM) is accepting nominations for the Excellence in Dairy Promotion Award. This award recognizes a Michigan dairy farmer who positively promotes the dairy community and dairy foods. Individuals who qualify for nomination possess extensive dairy promotion accomplishments and volunteer service to the industry and his or her local community.

Nominations must be received by Dec. 31, 2018. The award recipient will be announced at the Great Lakes Regional Dairy Conference, Feb. 7-9, 2019.

Nomination forms are available on the UDIM website or contact Jolene Griffin.

CDE offers dairy advisory team grants

Pennsylvania’s Center for Dairy Excellence (CDE) is accepting grant applications from dairy operations seeking assistance from production and financial management advisory teams. The funding may be used to cover costs associated with existing teams or to establish a new team.

Three types of teams are available to dairy farm families, with different grant levels for each:

  • Dairy Profit Teams, designed to identify bottlenecks and opportunities for greater profitability, up to $2,000 in reimbursements
  • Dairy Transition Teams, designed to help farm families develop a transition or succession plan, up to $3,000 in funding
  • Dairy Transformation Teams, designed to help producers considering a major business transformation or the addition of a renewable energy component, up to $5,000

Farms must complete an application and submit the required $100 application fee to participate in the advisory teams. CDE is accepting applications for the 2018-19 fiscal year. Once approved, farms can utilize the grant to be reimbursed for any qualified expenses incurred from July 1, 2018, to May 31, 2019.

Minnesota Milk hosting annual dairy conference and expo

The Minnesota Milk Producer Association will celebrate their 40-year anniversary during the annual Minnesota Dairy Conference and Expo, Nov. 27-28. Headquarters for the event is the Treasure Island Resort and Casino, Welch, Minnesota.

The conference agenda includes opening remarks from U.S. Dairy Export Council Secretary Tom Vilsack, entertainment from the Johnny Holm Band, a farm succession training workshop by John Baker, numerous speakers and MMPA’s annual meeting.

The awards banquet will be held Nov. 28. Honorees will include state Sen. Bill Weber, as Legislator of the Year; Brant Groen will receive the Bruce Cottington “Friend of Dairy” Award; and Metz Hart-Land Dairy, as the Producer of the Year.

The Metz family, of Rushford, Minnesota, was selected for the award based on their innovation, adding a cheese plant to their farm operations, and their social media and community involvement that helps connect consumers to dairy farming.

“I’m known as the city kid that went farming,” says Jeff, having grown up in Minnesota City, Minnesota. Jeff and Mariann Metz began their first-generation farm in 1983, milking 24 cows. They married in 1985, eventually moving to their current location, where they milk about 200 cows and have an on-site creamery and storefront.

“With four kids, over the years, I’ve always been thinking about how I can add value to the farm and grow our operation so that our kids can be a part of it,” says Jeff. Their children – Alicia, Courtney, Brittany and Nathan – all have some involvement on the farm and cheese plant, as well as Brittany’s husband, Nick. “It’s kind of rare that all four of them wanted to come back to the farm in some aspect,” says Mariann.

Registration is $100 per person for members and $250 per nonmembers. Conference registration includes access to all educational speakers, meals and entrance to the expo.

Register online by Nov. 26; registration is also available on-site the day of conference.  end mark

Dave Natzke