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TheDairySite Newsletter - 22 August 2014

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Friday 22nd August 2014.
Michael Priestley - Editor

Michael Priestley

Slight Relief From World Auction and Russian Rethink

Short term dairy market prospects were lifted slightly this week by stability from the Fonterra Auction and Russia’s lactose-free embargo amendment.

Wednesday’s Global Dairy Trade (GDT) index edged 0.6 per cent lower, a markedly smaller drop compared to recent auction results.

This was followed up by Thursday’s news of a relaxation to Russia’s ban, reopening doors to lactose-free milk.

Finnish processor Valio, which accounts for 85 per cent of Finnish dairy exports to Russia, has been singled out as main beneficiary.

As Finland’s largest dairy, generating 20 per cent of its income from Russian sales last year, Valio has also been one of the hardest hit, closing production lines in Finland and preparing Russian plants for shutdown.

These are highlights from market intelligence reports from teams at Dairy Australia and DairyCo which summarised the GDT result as ‘perhaps better than many expected’ and bringing ‘some measure of stability’.

Whole Milk Powder and Anhydrous Milk Fat increased by over three per cent, with the latter linked to speculation over a likelihood of increased Russian purchases.

Major decreases for Cheddar and Skim Milk Powder were reported.

The GDT’s price trough is caused by China’s stocks being full and higher production in the US, New Zealand and Europe.

Chinese demand is satisfied for now and yields in the US are expected to remain strong, said agricultural economist Professor Bob Cropp earlier this week.

US cows are greater in number this year, but more importantly they are producing more milk per head.

This is even true in regions battling against drought and high hay prices such as California, which produced more milk in July this year than last.

Positive crop reports could mean high yields continue into the winter, said Prof Cropp in his University of Wisconsin monthly commentary.

He said lower corn prices are helpful to dairymen but downward pressure would remain on dairy prices.

Total US milk production should be around four per cent higher than 2013.

Looking ahead, he wrote: “We can expect dairy product prices and milk prices to decline. The question is how soon and by how much.”

China’s buying spike, which leaves it ahead of Canada as the US’s second largest customer, has corrected, as full stocks have decreased import activity, he added.

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This Week's Articles and Analysis

Got Butyric? Why the Stinky Stuff Should Be Avoided
Butyric acid causes silage to smell, lowering feed intake and resulting in a wide range of metabolic issues, with transition cows particularly at risk.

Managing the Safe Delivery of Animal Feeds
Accidents and fatalities plague the agricultural sector, so planning for expected events, such as feed delivery day, should be worthwhile for an industry trying to stay safe.

10 Tips to Prevent Hay Fires
Journalise hay making moisture levels and test forage rigorously to assist in keeping hay fires at bay, a forage specialist from Idaho suggests.

How Does A Free Trade Agreement Benefit Dairy?
With almost three quarters of South Korean milk used for drinking, there is plenty of scope for the sale of processed dairy goods, write two economists at the US Deparment of Agriculture.

Company News

New Analysis Shows BVD-PI Testing Pays – Netting Producers $14 More Per Head
US - For the second consecutive year, research shows cattle buyers are paying a higher premium for calves that test negative for being persistently infected (PI) with bovine viral diarrhea (BVD).
Market Reports

Dairy Australia - Fortnightly Update 22 August 2014
USDA GAIN: Japan Livestock and Products Annual 2014
USDA National Dairy Products Sales Report- 20 August 2014
USDA Milk Production - 19 August 2014
USDA Livestock, Dairy and Poultry Outlook - 18 August 2014

Global Dairy Industry News


Over Half of Spanish Dairy Farmers Over Quota

   Russian Federation

Russia Adjusts List of Banned Agricultural, Fisheries Products
Russia to Introduce Electronic Veterinary Certificates


Colombia's Cattle ID Plans Progressing


South America Steps in to Meet Russian Needs
FAO Urges Continued Support for Animal Disease Monitoring
EW Nutrition Launches 'Science and Innovations' Series
Where Will Russia’s Cheese Come From?
Russia Eyes New Food Importers to Sustain Supplies


Mass Vaccination Response to Rampant Bluetongue

   United Kingdom

Five Point Plan to Tackle Calf Pneumonia
Scotland Holds Russian Trade Embargo Meeting
New Veterinary Vaccinology Network to Help Tackle Animal Disease Threat


China to Expand Agricultural Produce Trade with Russia
Small Fall in Chinese Food Prices


Brazil July Milk Price Stable


Introduce Institutional Reforms in Agriculture to Hike Yield, says PHDCCI
India LInks Agri MoUs with 52 Nations
Kwality Dairy’s Q1 net sales up 27.21 Per Cent
PDFA to Introduce Pure Milk in Punjab
India Holds Workshop on Brucellosis

   Viet Nam

Viet Nam Vets Complete Argentinian Tour

   New Zealand

North Island Farmers Recover from Devastating Storms
Fonterra and CSIRO Join Forces to Drive Sustainable Dairy Innovation
Working Group for Dairy Processing Sector Set Up

   European Union

Copa Cogeca Welcomes EU Commission Move to Support EU Agriculture Sector


Israel to End Export of Poultry, Dairy Products to EU


Supply Management Instruments Vital to the Milk Market

   United States

Cattle Outlook: Government Forecasts 14 Billion Bushel Corn Crop


Glanbia Cuts to July Milk Prices Attacked

   Palestinian Territory

Damage to Agriculture and Fishing in Gaza Will Have Long-lasting Effects


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