Dairy Profit Thursday
An (almost) daily recap of dairy information:
July 2, 2009
June federal order prices
The June federal order Class III milk price is $9.97/cwt., up 13¢ from May, but down $10.28/cwt. from June 2008. The 2009 year-to-date average is $10.19/cwt., down from $18.26/cwt. for the same period a year ago. The June Class IV price is $10.22/cwt., up 8¢ from May, but $5.70 less than a year ago.
CWT releases final retirement numbers
Cooperatives Working Together (CWT) finished the farm audits of its seventh herd retirement round since the program was started in 2003, removing 101,040 cows that produced an estimated 1.96 billion lbs. of milk. For more information, visit http://dairywebmall.com/dbcpress/?p=3438.
CWT to blame for lower cull cow prices?
Are all those Cooperatives Working Together (CWT) cows headed to slaughter to blame for a decline in the cull cow price in June?
Psychologically, maybe, but all the numbers don’t add up, according to Dillon Feuz, livestock marketing specialist at Utah State University. In his June 30 market analysis report, Feuz said the three primary drivers affecting beef cull cow prices are: 1) weakness in beef demand; 2) increased dairy cow slaughter; and 3) the psychological impact of the CWT program.
Feuz points to total slaughter numbers: During the last weeks of June, about 111,000 cull cows and bulls were slaughtered per week, up only about 1,500 head from the March/April average weekly slaughter average, and below year-ago level of about 115,000 head per week.
Dairy cow slaughter is up, from about 44,000 per week last year, to 50,000 per week this year. However, weekly beef cow slaughter has decreased from 71,000 head last year, to about 62,000 head.
According to latest estimates from USDA’s Dairy Market News, dairy cow slaughter under federal inspection for the week ending June 6 totaled 60,800, compared to 45,100 head for the comparable week a year earlier. Total cow slaughter was 123,600 head, up less than 2,000 from the 121,900 head for the comparable week a year earlier.
Year-to-date dairy cull cow slaughter was 1.284 million, up 152,000 head from a year earlier. Total cow slaughter was 2.678 million head, up just 43,000 head from 2008. Dairy cows are making up a bigger proportion of total cow slaughter in 2009: 47.9% year-to-date, compared to 43.0% for the same period a year ago.
For more information, visit http://dairywebmall.com/dbcpress/?p=3443
To see the latest analysis and comment from Feuz, visit http://cattlemarketanalysis.org.
Regular, ‘rbST-free’ and organic milk prices compared
The American Farm Bureau Federation’s Marketbasket Survey took a quarterly look at retail prices for regular, “rbST-free” and organic milk. For the second quarter of 2009, U.S. shoppers in 33 states reported paying an average of:
• $1.92 for a half-gallon of regular whole milk, down 24¢ from the prior quarter.
• $3.18 for a half-gallon of rBST-free milk, down 1¢ from the last quarter and about 65% higher than regular milk.
• $3.63 for a half-gallon of organic milk, down 8¢ compared to the first quarter and approximately 90% higher than regular milk.
Compared to a year ago (second quarter of 2008), the retail price for regular milk in half-gallon containers decreased 20%; “rBST-free” milk dropped about 5%; and organic milk went up and down slightly throughout the year, rising 1% in the second quarter of 2009 compared to a year ago.
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• one half-gallon of milk = approximately 4.3 lbs. = 23.25 half-gallons per hundredweight (cwt.) of milk.
• “rbst-free” premium markup: $1.26/half-gallon X 23.25 = $29.30/cwt.
• $3.18/half-gallon (price per half-gallon “rbST-free” milk = $73.94/cwt. gross income from sale of “rbST-free” milk
• May U.S. average fluid milk price paid to farmers: $11.60/cwt.* (Source: USDA)
*Some dairy farmers received a small premium for producing “rbST-free” milk.
For more information, visit http://dairywebmall.com/dbcpress/?p=3445.
Thursday’s markets
CME cash cheese and butter prices were unchanged on July 2; July 2009-April 2010 Class III milk futures were lower.
CBOT corn, soybean and soybean meal futures prices were all lower.
For today’s market activities on the Chicago Mercantile Exchange and Chicago Board of Trade, visit http://www.dairybusiness.com/dairybusiness_markets.php.
Reminder: No Dairy Profit Weekly this week
Dairy Profit Weekly takes its annual July 4 holiday this week, so there will be no issue dated July 6, 2009.
Continue to log on to www.dairybusiness.com for (almost) daily Dairy Profit Weekly updates.
For a sample copy of Dairy Profit Weekly, or subscription information, visit www.dairyprofit.com or phone: 800-334-1904, ext. 244.
Dave Natzke, Editor




