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Ohio.com - Price of milk may double

 

Price of milk may double Rising feed costs, surplus of cows will force farmers to cull herds by 103,000

By Jeff Wilson

Bloomberg News

Published on Tuesday, Jun 30, 2009

Dino Giacomazzi, whose great-grandfather started the Giacomazzi Dairy in Hanford, Calif., in 1893, said he had no choice but to sell 100 cows, or 11 percent of his herd, in the past four months. Rising feed prices and a world surplus meant it cost as much as $17 to produce $10 of milk.

''Producers are in an absolute state of panic,'' said Giacomazzi, 40. ''To spend 100 years building a dairy business and see much of that equity disappear in a year is very troubling.''

Farmers plan to shift the pain to consumers. The National Milk Producers Federation in Arlington, Va., will pay dairies to slaughter 103,000 U.S. cows in coming months. Milk futures prices will double next year to a record $23 per 100 pounds as the herd shrinks by 171,000 head, the most since 1989, said Michael Swanson, a senior economist at Wells Fargo & Co., the largest lender to U.S. farmers.

The cuts will lead to the first two-year drop in output in four decades and higher prices in 2010 for butter, cheese, milk and the nonfat dry powder that's a benchmark for global exports, according to U.S. Department of Agriculture forecasts. Futures for delivery in September 2010 are trading about 56 percent above current prices on the Chicago

Mercantile Exchange.

Retail butter prices might rise above the record of $3.937 a pound and Cheddar cheese might top $5.097 a pound, according to Jerry Dryer, 65, editor of the industry newsletter Dairy & Food Market Analyst in Delray Beach, Fla.

Farmers are culling herds because exports plunged 26 percent in the first four months of the year, supplies rose and the cost of corn, the primary feed ingredient, averaged almost $4 a bushel.

''No one is making money producing milk,'' Wells Fargo's Swanson said. ''The milk price remains well below the total cost of production.''

U.S. output increased to a record 16.73 billion pounds in May as cows on average produced 1,804 pounds each, the most ever, the USDA said June 18. A gallon weighs 8.6 pounds.

Wholesale milk fell 51 percent in the past year and reached $9.93 per 100 pounds on June 19 on the CME. The USDA forecasts average cash prices this year will drop 34 percent, the most since the agency began keeping the data in 1980. While corn fell to $4.195 last week from a record $7.9925 a bushel in June 2008, it's still 54 percent above the decade average.

In California, the largest milk-producing state, dairies lost $1.07 per 100 pounds in April, compared with profit of $11.23 in July 2007, based on feed costs and milk prices, USDA data show. In January, the state was the most unprofitable in at least six years of record-keeping.

It takes about 24 months and $1,600 to feed and care for a dairy heifer before it starts producing milk. The price of a young cow ready for milking has dropped by half in the past year to $1,200, he said.

U.S. milk production will fall 1.3 percent to 187.5 billion pounds this year from last year's record, and to 186.4 billion in 2010, the first back-to-back decline since 1969, the USDA said June 20.

Prices probably will rise at least 25 percent by the second half of 2010 as production slows and consumption rebounds with an improving economy next year, said Kelvin Wickham, managing director of global trade at Fonterra Cooperative Group Ltd. of Auckland, New Zealand, the world's largest dairy exporter.

''We do expect prices to trend higher toward the back half of the year,'' said Jack Callahan, the chief financial officer at Dallas-based Dean Foods Inc., the biggest U.S. processor and parent of Reiter Dairy operations in Akron.

milk_01.JPG Dairy cows feed at the Milky Way Dairy farm near Visalia, California, (Phil Hawkins/Bloomberg News)

Dino Giacomazzi, whose great-grandfather started the Giacomazzi Dairy in Hanford, Calif., in 1893, said he had no choice but to sell 100 cows, or 11 percent of his herd, in the past four months. Rising feed prices and a world surplus meant it cost as much as $17 to produce $10 of milk.

''Producers are in an absolute state of panic,'' said Giacomazzi, 40. ''To spend 100 years building a dairy business and see much of that equity disappear in a year is very troubling.''

Farmers plan to shift the pain to consumers. The National Milk Producers Federation in Arlington, Va., will pay dairies to slaughter 103,000 U.S. cows in coming months. Milk futures prices will double next year to a record $23 per 100 pounds as the herd shrinks by 171,000 head, the most since 1989, said Michael Swanson, a senior economist at Wells Fargo & Co., the largest lender to U.S. farmers.

The cuts will lead to the first two-year drop in output in four decades and higher prices in 2010 for butter, cheese, milk and the nonfat dry powder that's a benchmark for global exports, according to U.S. Department of Agriculture forecasts. Futures for delivery in September 2010 are trading about 56 percent above current prices on the Chicago

Mercantile Exchange.

Retail butter prices might rise above the record of $3.937 a pound and Cheddar cheese might top $5.097 a pound, according to Jerry Dryer, 65, editor of the industry newsletter Dairy & Food Market Analyst in Delray Beach, Fla.

Farmers are culling herds because exports plunged 26 percent in the first four months of the year, supplies rose and the cost of corn, the primary feed ingredient, averaged almost $4 a bushel.

''No one is making money producing milk,'' Wells Fargo's Swanson said. ''The milk price remains well below the total cost of production.''

U.S. output increased to a record 16.73 billion pounds in May as cows on average produced 1,804 pounds each, the most ever, the USDA said June 18. A gallon weighs 8.6 pounds.

Wholesale milk fell 51 percent in the past year and reached $9.93 per 100 pounds on June 19 on the CME. The USDA forecasts average cash prices this year will drop 34 percent, the most since the agency began keeping the data in 1980. While corn fell to $4.195 last week from a record $7.9925 a bushel in June 2008, it's still 54 percent above the decade average.

In California, the largest milk-producing state, dairies lost $1.07 per 100 pounds in April, compared with profit of $11.23 in July 2007, based on feed costs and milk prices, USDA data show. In January, the state was the most unprofitable in at least six years of record-keeping.

It takes about 24 months and $1,600 to feed and care for a dairy heifer before it starts producing milk. The price of a young cow ready for milking has dropped by half in the past year to $1,200, he said.

U.S. milk production will fall 1.3 percent to 187.5 billion pounds this year from last year's record, and to 186.4 billion in 2010, the first back-to-back decline since 1969, the USDA said June 20.

Prices probably will rise at least 25 percent by the second half of 2010 as production slows and consumption rebounds with an improving economy next year, said Kelvin Wickham, managing director of global trade at Fonterra Cooperative Group Ltd. of Auckland, New Zealand, the world's largest dairy exporter.

''We do expect prices to trend higher toward the back half of the year,'' said Jack Callahan, the chief financial officer at Dallas-based Dean Foods Inc., the biggest U.S. processor and parent of Reiter Dairy operations in Akron.

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You are so funny sometimes gHari.

 

Well, yes, I laugh a lot, but here it is simple economics - the law of supply and demand. If the demand for milk were higher then the price would be higher and they would not consider killing 103,000 cows to artificially reduce the supply in order to drive the price back up. Just economics. That's all these animals care about.

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You need to get some basic education on this subject gHari. The fact there are so many cows is because the demons keep the cows pregnant and having offspring for profit. Now they find they have over produced and hurt their own market.

 

Learn the subject just a little bit then have an opinion. Blaming vegans for the death of these cows is really out there.

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The point is: the cows are alive now. They have taken birth. This is the reality. They are alive. How do we save them?

 

If our strategy is to cause the demons to slaughter all female cows for meat thereby causing fewer cows to be born and suffer, then that is the game plan. But now, we have the cows. Tomorrow 103,000 will be dead. How many people does it take to drink 103,000 cows' milk a day? A million? Ten million? Not all that many.

 

Time and circumstance.

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The point is: the cows are alive now. They have taken birth. This is the reality. They are alive. How do we save them?

 

If our strategy is to cause the demons to slaughter all female cows for meat thereby causing fewer cows to be born and suffer, then that is the game plan.

 

Sorry, I can not make sense of your reasoning. Whose strategy are you talking about? The slaughter of cows will not cause less cows to be born because they are all being impregnated artifically anyway. The demons have simply caused the birth of too many cows to fit with the economic reality of today.

 

Milk production is subsidized by the government so these dairy demons all started producing more and more milk until they caused a glut in the market which brought the price down so now they have to cull the heards to get price back up.

 

It's quite simple. When there is too much oil being drilled the price per barrel goes down and OPEC gets together and agrees among themselves to pump less oil so the price will rise again.

 

For the dairy demons to get the price back up they must cull the herds so there will be less milk on the market.

 

 

 

 

 

But now, we have the cows. Tomorrow 103,000 will be dead. How many people does it take to drink 103,000 cows' milk a day? A million? Ten million? Not all that many.
Somehow you have the opinion that by drinking more milk you will save these cows. No so gHari. The more people that drink milk the more the dairy demons will feel the need to produce more meat.

 

Besides you cannot save these 103,000 cows they soon are destined to be slaughtered anyway.

 

Happily I can say not one of them or any cow in the future is being slaughtered to satisfy my craving to drink their milk.On this point at least my conscience is clear.

Some will be slaughtered to feed yours however.

 

 

 

Time and circumstance.
Yes time and circustance. When circumstance is right and you can obtain milk from protected cows then do it, until that time you should refrain in the name of Gopala.

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So Prabhupada is a cow killer, because he bought dairy products? This is what you are saying.

 

Why do you link to a site of the books of someone who by your definitions is a cow killer?

 

Why have you posted this so many times about not taking dairy, when the real reason why you don't is due to your lactose intolerance?

 

Can you understand why you don't come across as an emotionally stable individual?

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DRINK A GLASS OF MILK

glass-of-milk.jpg

SAVE A COW

cowpilation_cover.jpg ________

We really don't have guns,

but if you let us live,

we'll give you MILK.

............ p l e a s e !

Otherwise they'll kill us,

and eat us,

as soon as they can.

............. p l e a s e !

Edited by gHari

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So Prabhupada is a cow killer, because he bought dairy products? This is what you are saying.

 

Why do you link to a site of the books of someone who by your definitions is a cow killer?

 

Why have you posted this so many times about not taking dairy, when the real reason why you don't is due to your lactose intolerance?

 

Can you understand why you don't come across as an emotionally stable individual?

 

Ah yes, another attempt to play the Prabhupada card to hide one's own sins.You ask the same question over and over which I have answered on other threads but you never answer mine.

 

Why do you ignore his statement to protect cows yet preach cow protection?

 

I suggest you read the latest posting by Janava Nitai das on the thread "cow's milk again" and try to understand your own pyschology a bit. .

 

If my posting on this subject bothers you why are you daily going to these threads and posting on them. Only attacking what you perceive to be my position and ignoring the subject matter it's self?

 

As for me I told you on another thread that we have nothing further to discuss Please quit following me around the forum. You are starting to feel like a cyber-stalker.

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I am a milkaholic --yet I agree with Theist on the principle of ahimsa.

 

yet,

 

my very cynical response is:

 

The Bees [pollenating insects] have disappeared enmass . . . when it is conclusively revealed that agricultural pesticides caused their disappearence ---then shall we stop buying veggies from the industry that caused the bees to die?

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I am a milkaholic --yet I agree with Theist on the principle of ahimsa.

 

yet,

 

my very cynical response is:

 

The Bees [pollenating insects] have disappeared enmass . . . when it is conclusively revealed that agricultural pesticides caused their disappearence ---then shall we stop buying veggies from the industry that caused the bees to die?

 

Bhaktajan, please don't introduce another subject on this thread. The disappearing bees rates a thread of it's own.

 

Anyway the answer would be to drop the pesticides and go organic.

 

The real reason the bees are disappearing could be a reaction to all the animal slaughter. As the planet as a whole develops more into the mode of goodness the environment as a whole becomes more favorable to the development of all things good, like the production of fruits and vegetables.

 

Conversely, as the mode of darkness and ignorance becomes stronger the environment becomes antagonistic to the cultivation of nice things like good produce and other things characteristic of the mode of goodness.

 

So in this way we can a link between the failure to protect cows and other helpless creatures and the loss of the bees.

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So in this way we can a link between the failure to protect cows and other helpless creatures and the loss of the bees.
In the Gita Krishna seems to make a similar connection in the verse "annad bhavanti bhutani parjanyad anna sambhavah". The rough meaning is "Food grains come from rain, rain comes from sacrifice, sacrifice comes from prescribed duties", (one forth of these prescribed duties is the protection of cows by Vaishyas which produces the pure ghee necessary for sacrifice). If there is no protection of cows, and there is no offering of sacrifice (using the ghee from protected cows), then there will be no rain and no food. The basic idea is the entire cycle of growing food is disrupted, which today we have manifested in so many different ways (one of which is the disappearance of pollinating bees).

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Thank you JNDAS. That is indeed more direct. If we as humans neglected our God given duties what good thing can we expect?

 

We as humans today simply want to take, take and take some more. We take the Mothers milk and grow on it and then Mother grows old and it's our turn to care for her we sell her to the butcher who slits her throat for the pleasure of the meat eaters.

 

And it only adds insult to injury that we do this in God's name and feel quite pious over the whole matter. IMO of course.

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