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TheDairySite Newsletter - 05 February 2016

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Friday 5th February 2016.
Alice Mitchell - Editor

Alice Mitchell

MSD Animal Health

Dairy Markets Still in the Doldrums

There was more bad news on the economic front recently for dairy farmers around the world, with the markets still refusing to pick up.

More companies have cut the farmgate price they pay to dairy farmers once again, including Arla, First Milk and Fonterra.

This week's Global Dairy Trade (GDT) auction saw a further fall of 7.4 per cent in the GDT Price Index from the previous event.

This is the third event in a row that dairy prices have fallen.

The UK’s NFU called the downward price slide a ‘ruthless price war’ and said the inevitable result would be a large number of dairy farmers leaving the industry.

The organisation agreed with New Zealand’s levy board DairyNZ and Fonterra chiefs that global supplies are still large and still growing, particularly in Europe.

On the demand side, Fonterra's Chairman John Wilson said global economic conditions continue to be challenging and are impacting demand for a range of commodities, including dairy.

“Key factors driving dairy demand are declining international oil prices which have weakened the spending power of countries reliant on oil revenues, economic uncertainty in developing economies and a slow recovery of dairy imports into China. In addition, the Russian ban on European Union dairy imports continues to push more product on to the world market.”

DairyNZ chief executive Tim Mackle said the industry will be doing its best to provide support, building on what has already been done. The organisation is providing a variety of support measures, including workshops and trained professionals to help farmers under pressure.

NFU dairy board chairman Rob Harrison urged farmers to stay in touch with their banks and accountants, and called on processors to be honest with producers and give adequate notice of any changes.

He also suggested that other processors could put in place measures like Dutch milk co-operative Friesland Campina, where farmers are paid a small premium if they maintain or reduce the volumes of milk they produce.

“What we need more than anything is for all processors to actually talk to their suppliers and discuss the options available for both parties," he said.

Meanwhile in Europe, the European Milk Board (EMB) recently attended an audience with the Pope in the Vatican to ask for his support in the midst of the crisis.

Roberto Cavaliere, from EMB member organisation APL Italy, said he was impressed after speaking with the head of the Catholic Church: "Pope Francis takes a firm stand against abuse. We must also continue this uncomfortable struggle with the same fighting spirit. We need better underlying conditions for the dairy market, so that we and our families can have a future and sustainable agriculture becomes possible."

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USDA National Dairy Products Sales Report - 5 February 2016
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Global Dairy Industry News


Global Food Prices Fall Again, but Future Prospects Rest on El Niño
Global Dairy Trade Auction Sees Further Price Falls
Marks & Spencer, Waitrose Top List for Farm Animal Welfare

   United Kingdom

Dairy UK Strategy Aims to Improve British Dairy Exports
Welsh Badger TB Vaccination Report Causes More Debate
Two Thirds of Cattle Attacks on People Involve Dogs
Brexit Could Place British Farming in Jeopardy
Vets Disappointed with Lack of Policy on Stunning Before Slaughter
First Milk Prices Fall for February

   South Africa

Farmers Have to be More Pro-Active in Fight Against Brucellosis
South African Drought: No Relief in Sight


Researchers Try Oregano to Reduce Methane Emissions from Cows

   New Zealand

Fonterra Price Drop Shows Another Tough Period Ahead
New Zealand Dairy Farmers Facing Milk Price Cuts
Economic Cost of NZ Pasture Weeds Larger Than Thought

   European Union

Friesland Campina Maintains Milk Price for February
EU Extends Storage Aid for Butter, Skimmed Milk Powder
European Commission Makes Farm Incomes Priority

   United States

New US Child Nutrition Bill Could Improve Milk Consumption
US Cattle Inventory Up 3 Per Cent from 2015
Cow Welfare Not Compromised by Large Dairies, Study Shows


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