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Veteran Advisor
Posts: 3,097
Registered: ‎07-19-2010
0

Dairy Crisis

Have any of you heard about a glut of milk here in the US?

I was talking to one of my friends over in Central WI, and he was telling me about dairy producers that we're getting letters from their Milk Plants, saying that their contracts with the milk plants were being terminated, and they would no longer be taking their milk.

He told me about one farmer he knew, that shipped 3 semi loads of milk a day, and has no where now to go with the milk. The farmer apparently contacted 15 or so other dairy plants, and was turned down by all of them.

I also spoke with a friend of mine that farms near Janesville, WI, and he had heard that something was going on with dairy, but wasn't sure what it was.

My neighbor said that it had something to do with Canada, but I really didn't follow what he was saying.

Jen
Honored Advisor
Posts: 13,590
Registered: ‎05-13-2010
0

Re: Dairy Crisis

Sounds like Canada fired the first salvo by putting on tariffs on US dairy, perhaps pretty boy Trudeau needs to be reminded of the trade DEFICT that we run with them.

 

c) 2017, Bloomberg.

The U.S. dairy industry is appealing to President Donald Trump for help after Canadian companies halted some imports, exacerbating a glut of milk on the American side of the border and forcing one of the country’s biggest butter producers to scrap supply contracts with farmers.

 

Some U.S. dairy companies say that in the past week, they’ve lost all their Canadian sales of ultrafiltered milk, a concentrated ingredient used to boost protein content in cheese and yogurt. That’s due to a new policy rolled out in recent weeks that incentivizes Canadian processors to buy domestic supplies.

The Canadian move violates trade commitments between the two nations, according to industry organizations including the U.S. Dairy Export Council and National Milk Producers Federation. In a statement on Wednesday, the groups urged the Trump administration to take immediate action.

The lobbying from the dairy sector comes at a sensitive time for U.S.-Canada trade relations. Trump, who was elected with the help of strong rural support, has pledged to renegotiate the North American Free Trade Agreement to help U.S. industry. But his rhetoric has sparked concern among farmers that Nafta member Mexico may seek alternative sources of agricultural imports such as corn.

Grassland Dairy Products in Greenwood, Wisconsin, said it has lost Canadian business valued at as much as $100 million annually in the last week, and notified dozens of farmers that it can’t take milk deliveries beyond the end of April. Cayuga Milk Ingredients in Auburn, New York, said it also lost all of its Canadian exports, a source of about 30 percent of overall sales.

“I kind of do hope that people renegotiating Nafta use this to their advantage to get something back for America,” Cayuga Chief Executive Officer Kevin Ellis said. “It’s a huge loss for dairy farmers across the country, so we need something back from the Canadians. I think we need our pound of flesh out of them.”

Canada’s new pricing mechanism, known as the Class 7 program, was introduced in February, said Isabelle Bouchard, a spokeswoman for Ottawa-based Dairy Farmers of Canada, which represents 12,000 farms. Imports of U.S. ultrafiltered milk have caused an estimated C$231 million ($172 million) in annual losses for Canadian companies, according to the group. She said other factors, such as the stronger U.S. dollar, may influence Canadian processors’ buying decisions.

“No new tariffs have been created that would restrict USA access to the Canadian market,” Bouchard said in an email. “The problem is not Canada’s dairy system, the problem is that there is too much milk produced in the USA, which is not Canada’s fault.”

The Canadian Dairy Commission didn’t immediately respond to requests for details of how the Canadian system works. The U.S. dairy industry has complained about a lack of transparency. The mechanism is administered by individual provinces, which have been issuing notifications throughout March, according to Shawna Morris, vice president of trade policy at the National Milk Producers Federation.

While the Trump administration has done some work on the issue, the U.S. dairy industry wants to see more effort, and to “convey to Canadians the importance of trade going both ways,” Morris said.

During the last so-called spring flush in May and June of last year, the amount of milk wasted or used for animal feed in the northeastern U.S. exceeded 75 million pounds, the highest recorded in government data going back to 2000. Supplies are forecast to expand this year.

At Cayuga in New York, Ellis said he’s been getting offers of free supplies, but had to turn them down.

“There was no way, we are absolutely full,” he said.

dairy

Veteran Advisor
Posts: 2,078
Registered: ‎02-11-2013
0

Re: Dairy Crisis

a simple observation.  I've noted in the store my milk, cheese, butter, cottage cheese and yogurt have not went down.....so why

not just process it......would be nice to have some specials on ice cream.

 

Advisor
Posts: 531
Registered: ‎05-13-2010
0

Re: Dairy Crisis

doesn't seem to be a dairy crisis here..  A local dairy is planning to almost triple their cow numbers over the next couple years.I'm not sure how that works, but thats what I see from the outside looking in.

Veteran Advisor
Posts: 930
Registered: ‎05-20-2010
0

Re: Dairy Crisis

This is just like the pork industry, unrestrained expansion, will lead to unrestrained financial implosions. 25% of pork is now exported to bankrupt countries. Great business model...not.

Honored Advisor
Posts: 6,890
Registered: ‎07-18-2011
0

Re: Dairy Crisis

Clayton58,   Dairy expansion in our area is hard to read....  It seems to be always growing, but I can never tell if that is transplant inventory or new inventory.

Friend
Posts: 3
Registered: 2 weeks ago
0

Re: Dairy Crisis

AFBF Canada Dairy Article

 

I posted an article on this issue on American Farm Bureau's website. 

Highlighted
Veteran Advisor
Posts: 2,078
Registered: ‎02-11-2013
0

Re: Dairy Crisis

our milk, butter, ice cream and yogert have not went down in price over the last couple of months......

maybe FB needs to tackle that..........rather than waving around their pom poms.