Sustainability awards highlight excellence across dairy industry

The Innovation Center for U.S. Dairy, in affiliation with the Dairy Research Institute, announced the U.S. Dairy Sustainability Awards, a new program to recognize dairy farms, businesses and collaborative partnerships for efforts that deliver outstanding economic, environmental and/or social benefit, thus helping to advance sustainability of the dairy industry.

The awards are divided into three categories: dairy farm, dairy processing/manufacturing and energy conservation/generation. Nominations are being accepted at USDairy.com/Sustainability/Awards through Dec. 1, 2011.

“Consumers are increasingly interested in choosing nutritious, responsibly made products,” said Larry Jensen, president, Leprino Foods, and chair, Innovation Center for U.S. Dairy. “The U.S. Dairy Sustainability Awards highlight the dairy industry’s long-standing commitment to healthy people, healthy products and a healthy planet, while showcasing that sustainability makes good business sense, as well.”

Winners of the U.S. Dairy Sustainability Awards will be announced in February 2012. In addition, honorees will share their stories and passion for sustainability on a national scale in forums and venues, and will be featured on USDairy.com/Sustainability.

The awards are part of the U.S. Dairy Sustainability Commitment, an industrywide effort to measure and improve the economic, environmental and social sustainability of the dairy industry. Launched in 2008 under the leadership of dairy producers, the Sustainability Commitment has the support and participation of hundreds of organizations across the industry as well as others from academic, government and nongovernmental organizations.

“Across the entire U.S. dairy industry, the sustainability commitment is producing model programs and processes for improved efficiency and business value,” said Mike McCloskey, owner and general manager, Fair Oaks Farms, and chair of the Innovation Center’s Sustainability Council. “These awards provide an opportunity to recognize and share advances in production practices and technology that will help us meet the needs of an ever-growing population.”

Nominations are open to all segments of the U.S. dairy value chain — from farm to table — for the following awards:

• Elanco Award for Outstanding Dairy Farm Sustainability: This award will recognize dairy farm businesses for demonstrating outstanding achievement in sustainability. Three farms will be honored to illustrate that the highest standards of excellence can be regardless of farm size, location or type of operation.

• U.S. Dairy Export Council Award for Outstanding Dairy Processing & Manufacturing Sustainability: This award will recognize dairy processing and manufacturing businesses for demonstrating outstanding achievement in sustainability.

• Center for Advanced Energy Studies/Idaho National Laboratory Award for Outstanding Achievement in Energy: This award will recognize outstanding achievements in energy conservation and/or renewable energy generation.

All nominations will be evaluated based on the program’s or project’s results as measured by triple bottom-line success — economic, environmental and social. Judges also will assess the potential for adoption of the idea by other dairy farms and businesses; demonstrated learning, innovation and improvement; and scalability.

“Dairy farm families and businesses have a proud legacy of providing nutritious, high-quality milk and dairy products while being good stewards of our natural resources,” said Jerry Kozak, president and chief executive officer of the National Milk Producers Federation (NMPF). “These awards are another example of the leadership role the dairy industry is taking to secure a healthy future for the next generation.”

Judging will be completed by an independent panel representing the full spectrum of the dairy supply chain, as well as academia, government, media, business and nongovernmental organizations. The distinguished panel of judges will be announced in October 2011.

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Genomic Testing Accelerates

Genomic testing of dairy cattle, with its first proofs offered in January 2009, is gaining even more momentum as high density SNP chips become available. Whereas the first tests look at 3,000 SNPs, the newest, high density chips will look at 800,000.

The higher density chips offer more accuracy.  For example, the parent average PTA for milk is about 42% reliable. Using the 3K chip increase accuracy to 60% and using the 800K chip bumps it to 72%.

The irony, notes Curt Van Tassell, USDA’s genomics guru, is that daughter data and progeny testing is still as critical today as it was prior to the genomic revolution. “Data is more critical than ever,” he says. Without daughter data, there is no way to verify whether the gene markers are accurate in the testing regime.

The other major concern with genomic selection is that it will increase inbreeding. But just the opposite might be true, if the technology is used correctly. Genomics can be used to identify sires with both high merit and be further away from breed average in terms of inbreeding. However, to know for sure, progeny tests of that particular bull’s daughters must be done to verify what the DNA tests are indicating, he says.

The other hope is that genomics can be used to identify economically important, but lowly heritable traits much faster than conventional testing. For example, feed efficiency is critically important to both cost of production and carbon footprint. By intensively measuring feed efficiency in a 1,000 animals in a number of herds, for example, genomics should allow geneticists to identify the critical gene markers. That information can then be used to select high feed efficient sires. Again, field data is critical to verify the information.

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Milk recalled due to improper pasteurization

Milk sold in Lake County from a northern Illinois dairy may have been processed without proper pasteurization and state officials are telling consumers to throw it away.

A routine inspection at Ludwig Dairy Products in Dixon found pasteurizing equipment operating improperly, potentially allowing raw milk to be mixed with pasteurized milk and sold in dairy products, according to the Illinois Department of Public Health.

Inspectors found a system-controlled pump, designed to stop the production process if raw milk pressure exceeded pasteurized pressure, was bypassed and replaced with a pump not wired into the controls, according to health officials.

Ludwig is taking its name brand products off store shelves. They are sold mostly in northern Illinois, including Cook, DuPage, Kane, Lake, McHenry and Will counties; and also in Indiana, New Jersey and New York.

No illnesses have been reported in connection with the products, but health officials are recommending Ludwig products not be consumed and be thrown out until the pasteurizing equipment is operating correctly and has been re-inspected.

A drinkable yogurt product sold under the brand name Nuestro Queso is also affected.

Ludwig is working with the health officials to determine the extent of the improper pasteurization, officials said.

Pasteurization is the process of heating raw milk to a high enough temperature for a long enough time to kill illness-causing bacteria, the release said. Raw milk and products made from it (such as cheeses and yogurts) can be contaminated with bacteria that can cause serious illness or death.

Common symptoms can include diarrhea, stomach cramping and vomiting, but can also include kidney failure and paralysis.

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Beat the back-to-school food blues

Going back to school often means hitting the books for ideas to create healthy lunchbox and after-school treats that kids will love. Luckily, the experts at the California Milk Advisory Board (CMAB) have developed a host of easy tweaks and creative twists that will keep you thinking outside the traditional lunchbox all year long.

Milk it: Don’t forget the milk money. Studies have indicated that more than half of children aged 2 to 8, and three-quarters of children age 9 to 19, do not consume the recommended daily servings of milk and other dairy products. Replacing soda and juice with low-fat or skim milk is an easy way to eliminate empty calories and enhance the nutritional value of kids’ diets. Milk and dairy products not only taste good, they are excellent sources of calcium and important nutrients like vitamin D, phosphorus, riboflavin and protein that growing minds and bodies need.

Go global: Encourage your children to experience the foods of the world. Lettuce wraps are a great place to start. Pack a stack of iceberg lettuce leaves, grilled chicken strips, shredded cheese and a yogurt-spice dressing (cumin, mint and dill all work well). For younger kids, send veggie sticks with homemade dip made with Real California buttermilk, yogurt or sour cream. Even better, create cheese and veggie “sushi” rolls by slicing cucumbers into one-inch rounds, scooping out the center and filling with your favorite cheese like Mozzarella or Cheddar. Finish it off with a sprinkle of sesame seeds for added effect.

Make food fun: Lunch time is a break from the day’s learning – why not make it even more fun with food? Instead of traditional cheese slices, try cubes and/or a variety of shapes. Cookie cutters work wonders on cheese and come in every shape imaginable.

And when kids are eating at home, try some fun new takes on traditional meals:

* Kids love the idea of having breakfast for lunch or dinner. For a truly surprising option, try a scoop of cottage cheese (or frozen yogurt) topped with an apricot or peach to look like a fried egg, complete with strips of fruit leather “bacon” and pound cake “toast” on the side. This makes a great after-school snack as well.

* Or, transform the beloved grilled cheese sandwich into look-alike French fries by cutting the sandwich into strips and serving in a paper boat or fry bag with ketchup or fry sauce on the side.

Say “yes” to sweet treats: Sweets aren’t all bad. Why not let your child indulge in a cottage cheese “sundae” starting with healthy low-fat cottage cheese topped with strawberry preserves and sprinkled with chocolate chips, toasted coconut or granola. Fruit slices dipped in yogurt and rolled in granola also make a yummy, healthy lunchroom or after-school bite.

Or, if you want to surprise your child with a frozen treat, try freezing yogurt sticks. Not only do kids love the way they taste, but they keep the contents of the lunchbox nice and cool. Remember, when you’re preparing lunch to keep ice packs at the ready because dairy products stay their freshest at 38 to 40 degrees Fahrenheit.

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Pfizer Animal Health names Northeast ‘externship’ participants

As part of its “Commitment to Veterinarians” program, Pfizer Animal Health welcomed 12 Northeast university students to its 2010 “externship” program, providing “hands-on” field training in livestock animal medicine. Participants include:

• Cornell University – Stephanie Brittan, Mark Fagan and Caitlyn Jeffrey.

• Tufts University – Deandra Dill, Alison Perkins Keen and Sarah Raabis.

• University of Pennsylvania – Cortney Bower, Amy Gates and Megan Tiffany.

• Virginia Tech – Sarah Brauning, Seth Mavrich and Jenny Miller.

The program is aimed at helping first- and second-year veterinary medicine students with a potential interest in large-animal medicine. They are placed at participating veterinary clinics to expose the students to the real-world aspects of this type of practice.

The program is available to students at every veterinary school and/or college of veterinary medicine in the United States.

In addition to the externship program, Pfizer Animal Health also provides scholarships to third-year college students who are nearly ready to enter the work force. This spring, Pfizer Animal Health offered a 1% rebate to local veterinarians, who then could donate those funds to the American Association of Bovine Practitioners (AABP) Foundation scholarship program.

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Dairy Industry News 8.26.11

Federal milk marketing order reform provisions in National Milk Producers Federation’s (NMPF) Foundation for the Future (FFTF) proposal are like “reordering the rules of the prison,” according to John A. Kaneb, CEO of HP Hood LLC.

“I think the industry could do very well without federal orders,” Kaneb said at the joint meeting of the Northeast Dairy Foods Association and the Pennsylvania Association of Milk Dealers. More than 115 processors and suppliers were represented at the meeting, Aug. 23-24 in Manchester, Vt.

He acknowledged that he has been in the dairy industry for only 15 years, expressing respect for processors and farmers who have been in dairy for generations.  He said doing away with the complex of regulations would be like opening the gates of the prison, but the inmates won’t leave because they’ve spent their whole lives there.

“If I had been raised in this industry, I would feel the same way,” he said.

Kaneb said Class I handlers have not been treated fairly under FMMOs, and those inequities are continued under the FFTF proposals.  He suggested one of the reasons for the flat line of fluid consumption for the past 50 years is the pricing disadvantage for Class I milk to processors, always the highest price, with no opportunity to forward contract with producers.

Also speaking in the panel discussion was William Byrne, chairman of Byrne Dairy, Inc., in Syracuse, N.Y.  He said producers and processors generally have enjoyed a successful industry for the past 15 years, and that there is much common ground among the proposals put forward by NMPF and the processor organization, the International Dairy Foods Association (IDFA), with the exception of the supply management program in FFTF.

Byrne said the unprecedented damage caused by the huge producer price drop in 2009 is the reason why something needs to be done, but he doesn’t believe the supply management piece of FFTF would prevent another disaster.  He said farmers would pay into the program when prices are at their lowest, and that “it will take an army of USDA bureaucrats to run this thing.”

He opposed eliminating component pricing for farmers, saying that it had completely ended the problem of farmers adding water to their milk.

Byrne complimented a report on industry recommendations from USDA’s Dairy Industry Advisory Committee (DIAC), and agreed that “we need to do something to avoid another major league disaster.”

Speaking clearly in favor of FFTF was Dr. Robert Wellington, senior vice-president and economist for Agri-Mark Cooperative, Inc., in Lawrence, Mass.  He reviewed the elements of the plan and said his organization, as a member of NMPF, was in strong support of the total package, in spite of some aspects which were not especially appealing to his membership of primarily smaller producers, notably the elimination of the Milk Income Loss Contract (MILC) program.  But, he said, there needs to be a national program.

Wellington emphasized the alternative to FFTF is not the status quo.

“The world has changed. We now export 13% to 15% of production, and we need to support the ability of our members to stay in business,” he affirmed.

8.26.11

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Chocolate milk under assault in middle of farm country

A group of people showed up at the Fresno (Calif.) Unified School Board meeting last Wednesday asking to have flavored milk removed from school menus.

According to KSEE-TV, school board officials plan to discuss the further in coming weeks. Click here to see the KSEE-TV report.

A number of other school districts across the country have discussed the issue, but these districts have been in non-agricultural areas. Fresno is smack dab in the middle of the San Joaquin Valley, one of the richest agricultural areas in the world and located near quite a few dairies.

Yes, it happened in Fresno, but it could happen anywhere, points out Ashley Rosales, registered dietitian and project manager at the Dairy Council of California,

Rosales says to her knowledge the Fresno school board members plan to talk to other parents in the district. “We are confident that Fresno will listen to what the parental wishes are,” she told Dairy Herd Management.

A majority of people in Fresno support flavored milk in schools, she says, citing a Facebook poll that was conducted by KFSN-TV in Fresno. Between Tuesday evening and Friday afternoon last week, 457 people responded to the poll, with 72 percent saying “no,” the school district should not ban flavored milk from the menu.

Rosales says staff from the Dairy Council of California will continue to monitor the situation and possibly attend one of the next school board meetings.

Fresno schools have already removed strawberry-flavored milk from their menus, KSEE-TV reported, so that leaves chocolate milk still up for discussion.

Recognizing that many schools want to reduce the sugar content in their menu offerings, the dairy industry has taken action to reduce fat, calories and added sugars in flavored milk.

The majority of milk in schools today is low-fat or fat-free, and the majority of flavored milk is at  or below 150 calories. The newer formulas have two to three teaspoons of added sugar compared to 3 to 4 teaspoons of added sugar in traditional formulas.

In June, it was announced that the Los Angeles Unified School District would remove flavored milk from its menus. Other school districts that have decided to drop flavored milk in at least some meals include Washington, D.C., Boulder Valley, Colo., Berkeley, Calif., and Minneapolis, Minn.

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USDA reports contain a mixed bag for dairy

Those looking hard enough could probably find good and/or bad news in two key monthly USDA reports released Aug. 11 – the Crop Production report and World Ag Supply and Demand Estimates (WASDE) report.

USDA lowered its 2011 milk production forecast, to 195.6 billion lbs., down about 100 million lbs. from a month ago. Expected marketings were also cut by 100 million lbs., to 194.6 billion lbs. The reduction comes despite indications producers are holding relatively large numbers of dairy replacement heifers, and is due to higher feed costs and the recent hot, humid weather, both affecting milk output per cow. If realized, 2011 production would be 1.5% more than 2010 actual production.

USDA left 2012 milk production and marketing projections unchanged, at 198.8 billion lbs. and 197.8 billion lbs., respectively. What impact this summer’s heat and humidity have on reproduction – affecting next year’s milk production – remains to be seen. If realized, 2012 production would be 1.6% more than 2011 projections.

Commercial exports are forecast higher for 2011 on a fat basis, to 9.0 billion lbs., but unchanged on a total solids basis, at 8.7 billion lbs.

With lower milk production, projected 2011 milk and dairy product prices were mostly higher compared to a month ago, but 2012 price forecasts were left basically unchanged.

The all milk price is forecast at $20.30-$20.50/cwt. for 2011; $17.80-$18.80/cwt. for 2012.

Beef price projections  Impacting cull cow prices, 2011 and 2012 cattle (steer) price forecast was essentially unchanged, at $110-$113/cwt. and $111-$120/cwt., respectively.

Feed price projections  USDA’s World Ag Supply & Demand Estimates report projected the 2011/12 U.S. season-average farm price for corn at $6.20-$7.20/bushel, up 70¢ on both ends of the range compared to a month ago. The projected 2011/12 U.S. season-average soybean price is in a wide range, $12.50-$14.50/bushel, up 50¢/bushel on both ends of the range. Soybean meal prices are forecast at $355-$385/ton for 2011/12, up $10/ton on both ends of the range.

Crop reports  Due to late spring planting, USDA incorporated updated producer survey information in its monthly Crop Production report.     Based on conditions as of Aug. 1, corn production is forecast at 12.9 billion bushels, up 4% from 2010, but down 4% from last month’s estimate. While still the third largest U.S. corn crop in history, the reductions are primarily due to smaller harvested area (84.4 million acres, down 500,000 acres from last month) and lower yields (153.0 bushels per acre, down 5.7 bushels/acre compare to the July forecast). Unusually high  temperatures and below average precipitation during July across much of the Corn Belt sharply reduced  yield prospects.     Total projected corn use for 2011/12 was reduced 340 million bushels, with feed and residual use projected  150 million bushels lower, reflecting the smaller crop and higher expected prices. Corn use for ethanol is  projected 50 million bushels lower, with tighter supplies and lower forecast gasoline consumption for 2011  and 2012. Projected corn exports for 2011/12 are reduced 150 million bushels, with wheat feeding  expected to increase. Ending stocks are projected 156 million bushels lower at 714 million bushels. The stocks-to-use ratio is projected at 5.4%, compared with last month’s projection of 6.4%.

Soybean production is forecast at 3.06 billion bushels, down 8% from last year and down 5% from last month’s estimate. Based on Aug. 1 conditions, yields are expected to average 41.4 bushels per acre, down 2.1 bushels from last year. Area for harvest is forecast at 73.8 million acres, down 4% from 2010.      For the 2011/12 crop year, soybean ending stocks are projected at 155 million bushels, down 20 million bushels from July, as reduced supplies are only partly offset by reduced exports and crush. Soybean exports are reduced 95 million bushels, to 1.4 billion, mainly due to the lower crop and increased projected supplies in South America this fall. Soybean crush is reduced 20 million bushels on lower domestic soybean meal use.     Dry hay  According to the Crop Production report, dry hay supplies will be smaller. Production of alfalfa and alfalfa mixtures is forecast at 65.0 million tons, down 4% from last year. Based on Aug. 1 conditions, yields are expected to average 3.36 tons per acre, down 0.04 ton from last year. If realized, this will be the second highest yield since 2005. Harvested area is forecast at 19.3 million acres, unchanged from the June forecast but down 3% from the previous year’s acreage.

Adequate rainfall along the Pacific Coast, across much of the Northern Tier, and in portions of the eastern half of the country has led to greater yield expectations in several states. Most notably, record-tying yields are forecast for Idaho, North Dakota and Virginia. Elsewhere, predominately hot, dry weather adversely affected much of the alfalfa crop.

Production of other hay is forecast at 67.0 million tons, down 14% from last year. If realized, this will be the lowest production level since 1993. Based on Aug. 1 conditions, yields are expected to average 1.75 tons per acre, down 0.20 ton from last year. If realized, this will be the lowest United States yield since 1988. Harvested area is forecast at 38.3 million acres, unchanged from the June forecast, but down 4%t from last year.      Unusually warm temperatures, coupled with little to no moisture across much of the southern half of the country, have led to decreased yield expectations in many states. Severe to exceptional drought conditions centered over Oklahoma and Texas, but stretching from the Four Corners region through much of the Delta, have negatively affected pastures and many grass hay fields. Elsewhere, adequate rainfall and surplus snowpack across much of the Northern Tier provided favorable growing conditions for hay. Producers in North Dakota, Washington and Wyoming are expecting record high yields, while forecasted yields in Louisiana and South Dakota are expected to be record tying.

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Dairy Business News 8.8.2011

Midwest milk-feed price ratios top U.S. average

The Upper Midwest benefits from home-grown and local feed sources, with milk-feed price ratios running higher than the national average. In addition to USDA’s monthly estimate of the milk-feed price ratio, USDA’s Dairy Market News reports milk-feed price ratios for selected states (below). The  index – representing the pounds of 16% commercially mixed dairy feed equal in value to 1 lb. of whole milk – is based on current prices for a ration of 51% corn, 8% soybeans and 41% alfalfa hay.
State milk-feed price ratios
July         June        July
State               2011*        2011       2010
Iowa                2.21          2.11        2.35
Michigan        2.21          2.17        2.50
Minnesota      2.35          2.27       2.29
Ohio                2.03         1.95         2.27
Wisconsin      2.24          2.17        2.27
U.S. average   1.91          1.88        2.31
* Preliminary
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Liquidity Is the Elixir for Stomach-Churning Dairy Markets

$500 per cow in liquidity? Even $750. Yeah, you betcha, says Ross Anderson, chief credit officer with AgriBank.
The increased volatility of today’s dairy markets, driven now in part by global events, means you need to increase both liquidity and solvency on your balance sheet. “It used to be that you needed $200 per cow in liquidity,” says Anderson. “In today’s environment, $500 to $750 per cow is not unwise.”
That doesn’t have to be all in cash, of course. Risk management strategies that lock in actual margins, inventoried feed and solid lines of credit all can play a role in reaching adequate levels of liquidity and solvency. The key is to get there, stay there and remain vigilant. Here’s why:
“Adverse paper in dairy loans jumped from less than 2.5% in 2007 and 2008 to the low teens in 2009,” says Anderson. Even with extremely good milk prices, that level of adverse paper—dairy loans in trouble because of problems with repayment, equity or collateral—has not substantially improved since. “We haven’t healed the wounds of 2009,” he says.
Both he and Terry Barr, a well-respected Farm Credit System economist and now senior director for CoBank’s Knowledge Exchange, are concerned that today’s high prices are the result of strong export demand. That’s all good, they say, as long as it lasts.
But it also puts U.S. dairy producers in a vulnerable position should another demand shock or economic crisis scuttle those exports. Recent news out of Washington and Europe are cause for worry. “You need a deeper balance sheet that you have to be hedged against,” says Barr.
While dairy exports now sop up 13% of milk solids produced in this country, the U.S. is still seen as a residual supplier in the minds of most international buyers. That’s not a good place to be because residual suppliers are usually last in when demand grows and first out when it shrinks.
“Our U.S. industry still has to be much more proactive in global markets,” says Barr. “We need to establish brands and markets that fit these international demands. If you don’t have an established export market, you have to downsize when the residual demand disappears.”
Plus, no surprise to anyone, high feed costs here at home are eating away at much of those higher 2011 milk prices. “We’ll be in this situation for at least another year, maybe two,” says Barr. “Hope is not a strategy when it comes to high feed costs.”
Yes, there are rumblings that the ethanol credit will go away, maybe even sooner than later, as Congress struggles to find budget savings. But even if the credits disappear, ethanol mandates—which require refiners to blend ethanol into gasoline products—remain.  Those 5 billion gallons of ethanol mandates eat up 30 million corn acres. That part of the market is locked up, says Barr, which will continue to put pressure on feed prices.
Plus, the U.S. budget deficit and our inability to solve it don’t bode well for currency values. A weak dollar means our dairy exports may be more attractive overseas, but it also means $6 corn isn’t really $6 in China. That, too, will put pressure on feed exports–especially if there’s a weather scare anywhere in the world.
Risk management, liquidity and solvency are the holy trinity of surviving and thriving these next few years. Knowing what to shoot for is the first step.
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