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Supported U.S. butter market
surges as cheese pulls back

August 28, 2015

By Alyssa Mitchell

MADISON, Wis. — The cash butter price at the Chicago Mercantile Exchange (CME) surged to $2.37 per pound last week, and analysts say the price could be supported in the near term as the holiday buying period kicks in.

CME butter pulled back earlier this week, dropping 7.75 cents to $2.2925 per pound by Tuesday, but on Thursday butter gained another 5 cents to settle at $2.3425 before falling a quarter cent to $2.34 today.

CME futures on Thursday showed butter above $2 through November, but then dropping into the $1.70s for the first half of 2016.

“We’ve got a butter market that, in my mind, kind of baffles people,” says Jon Spainhour, broker/partner with Rice Dairy LLC, Chicago. “We’ve got some pretty heavy stocks, and only a small stocks drawdown month to month from June to July (according to the latest Cold Storage report released Aug. 21 — see article in this issue). Looking at that doesn’t explain $2.37 butter.”

However, Spainhour notes cream is very tight in the United States right now, and sources are saying they are having a hard time finding it.

With schools starting back up, it could exacerbate the situation further and keep the butter market supported, he adds.

“I’m not confident we’ve seen highs for butter yet this year,” he says.

USDA’s Dairy Market News confirms cream availability for churning is tight as the butterfat component in milk continues to be low.

“In addition, some processors prefer to sell cream as demand and multiples remain strong,” Dairy Market News says. “Consequently, butter production is marginally lower. At this point, the market tone is unsettled.”

However, Dairy Market News notes that some manufacturers are expecting an increase in production during the fall to meet the seasonal high demand in the fourth quarter.

“Bulk output is lower as butter is increasingly moving to the print lines. Retail sales for print butter are steady to higher as the Labor Day holiday approaches,” Dairy Market News says.

Sara Dorland, managing partner with Ceres Dairy Risk Management LLC, Seattle, says that while butter stocks reported for July were likely higher than the market expected, fresh product could still be tighter than comfortable ahead of the holiday season.

“While butter stocks were high, if the butter is in consumer packaging or is imported or is anhydrous milkfat, there can be a lot of that product, but it does little to influence trading at the CME as none of those products are fungible,” Dorland says.

However, she adds that butter could come under pressure in September.

“Should stocks remain high, imports remain strong and demand solid but not able to keep up with the butter inflows, we could see a good amount of weakness in butter. Likely, butter could find support at the $2 level in October. It will really hinge on consumer butter demand this fall,” Dorland says.

CME nonfat dry milk (NDM) also has gained in the past couple of weeks, following more positive Global Dairy Trade (GDT) results last week than had been seen most of the year. NDM, which dropped to $0.69 earlier this month, began to show positive gains last week and reached $0.81 per pound on Thursday before falling 4 cents to $0.77 today.

“Central nonfat dry milk prices are steady to higher,” says Dairy Market News. “The market tone is unsettled. The increase in the CME Group pricing has some wondering if the market is firming. Some manufacturers are making and storing NDM in order to wait for higher pricing levels, while others are selling at discounts in order to not keep high inventory levels. Demand is low domestically, as some end users report having adequate supplies through the end of the year, while others are purchasing product to build inventories.”

Dairy Market News adds that some sellers are reporting export interest is picking up, and some cheese manufacturers are discontinuing use of NDM in order to sell available cream.

Meanwhile, CME cheese prices have been mostly lower this month, settling at $1.60 per pound for barrels today. Blocks also had dipped into the $1.60s but settled at $1.70 today.

“I expect butter to hold up pretty well for awhile, although inventories are high, but cheese seems to be more fragile,” says James Dunn, professor of agricultural economics at Penn State University. “Both products face a domestic market that is saturated, with very little international demand, so as the autumn progresses, I wouldn’t be surprised to see prices slip.”

Dorland notes that for most of 2015, cheese has found support in the mid-$1.60s and battles its way back up to just under $1.80 before falling back.

“Overall, that suggests a somewhat balanced market, not one that is oversupplied,” she says. “That said, as the holiday season nears, these stock levels can change from ‘not so bad’ to ‘oversupplied’ quickly.”

Spainhour says if the cheese market hasn’t reached its highs for the year yet, it should be near it.

“Stocks are up. Exports have decreased dramatically. Imports have increased dramatically,” he says.
He adds that while domestic demand has been good, he does not know that it’s enough to offset other factors.

“I think we could get down to the low $1.50s by the end of the year and even lower in 2016” for cheese, he says.

Spainhour says butter also could drop off in 2016.

“As we move past that holiday demand, it’s possible we’ll see our dairy prices falling off a cliff,” he says. “Production in New Zealand and Europe and even here is up, and we’re the highest price in the world. That will make it very difficult to export.”

Dunn says he feels export sales are the major factor.

“Exports have driven the markets for the past few years, and when the product can’t find an export home, it causes domestic markets to struggle,” he says.

“The strong dollar is making us uncompetitive in distant markets,” he adds.

“There is still a lot of milk in the world,” Dorland notes. “Preliminary June data from Europe puts milk production up 3.6 percent, Mexico is higher, the United States is higher and expectations are that Australia and New Zealand will have a solid start to the season. Until milk supply starts to abate, prices likely remain with a weak undertone.”

CMN


Vermont Creamery completes
expansion for aged cheeses

August 28, 2015

WEBSTERVILLE, Vt. — Vermont Creamery has completed an expansion to its aged cheese facility here, adding 14,000 square feet and more than quadrupling its cheesemaking capacity. The $4 million expansion is the largest investment made by the creamery in its more than 30 years of business, and the extra capacity will allow the company to meet projected demand for its signature aged goat cheeses into the next decade.

“Aged geotrichum-rinded goat cheeses are incredibly popular in Europe, and we are seeing similar trends in demand here in the U.S.,” says Adeline Druart, general manager, Vermont Creamery. “The cheese no one had heard of 10 years ago is now the fastest growing in our product line.”

The company’s original aged cheesemaking facility opened in 2006, and that year, Vermont Creamery sold about 5,000 cases, mostly to specialty food shops and cheesemongers. Last year, the creamery sold more than 100,000 cases of its aged cheese, including sales to major national retailers such as Whole Foods Market and Wegmans.

The state-of-the-art expansion includes a high-tech atmospheric control system that manages ventilation, moisture, temperature and particle filtration, calibrated for optimum ripening and rind development.
“Cheese is alive, and all of these factors have a big impact on the final product,” Druart says.

Vermont Creamery first introduced Bonne Bouche, a goat’s milk cheese lightly sprinkled with ash and aged for about 10 days, in 2001. The cheese, which has won numerous national and international awards, is distinguished by a naturally-wrinkled, geotrichum rind and creamy interior. Vermont Creamery’s aged line now includes four total cheeses — Bonne Bouche, Cremont, Coupole and Bijou.

Barre, Vermont-based Groleau Construction completed the aged cheese expansion with the help of local contractors, including Dexter Electric, Hutch Concrete and New England Air Systems.

CMN


Butter stocks up 41 percent
from year ago, NASS says

August 28, 2015

WASHINGTON — Natural American-style cheese in cold storage totaled 698.3 million pounds July 31, 2015, up 2 percent from June 30, 2015’s 685.7 million pounds and 6 percent more than the 660.4 million pounds in cold storage at the end of July 2014, according to recent data from USDA’s National Agricultural Statistics Service (NASS).

Swiss cheese in cold storage totaled 21.6 million pounds July 31, up 4 percent from June’s 20.8 million pounds but 12 percent lower than the 24.6 million pounds in cold storage a year earlier.

Other natural cheese in cold storage totaled 442.5 million pounds at the end of July, up 2 percent from June’s 435.7 million pounds and up 20 percent from the 369.9 million pounds in cold storage a year earlier.

Total natural cheese in cold storage totaled 1.16 billion pounds at the end of July, 2 percent higher than June 30’s 1.14 billion pounds and 10 percent higher than the 1.05 billion pounds in cold storage at the end of July 2014.

NASS reports butter in cold storage totaled 254.5 million pounds July 31, 2015, down 1 percent from June 2015’s 256.0 million pounds but 41 percent higher than the 180.8 million pounds in cold storage at the end of July 2014.

CMN


Goat Lady Dairy listed for sale; owners to retire

August 28, 2015

By Chelsey Dequaine

GREENSBORO, N.C. — The owners of Goat Lady Dairy, Steve and Lee Tate, have announced they will retire by the end of the year and have listed the former abandoned tobacco farm turned dairy farm for sale.

“We took a place everyone else rejected and turned it into a destination,” Steve Tate says.

His sister, Ginnie Tate, also known as The Goat Lady, started the hobby farm in Randolph County, North Carolina, in 1984. When Steve Tate, and his wife, Lee, joined her in 1995 and founded Goat Lady Dairy as a business, he says they were one of the few artisan cheese producers in the South.

When making the decision to retire, Tate says it wasn’t difficult.

“From the beginning we had the goal to build something that could be passed on,” he says. “We have enjoyed being North Carolina pioneers on this artisan cheese farm. We value our partnerships with the dairy farm families who work hard to produce the quality goat and cow milk we use to make our cheese, and we take satisfaction in creating good jobs for our team. It is time for us to get out of the way and let these talented folks carry on.”

Tate says his favorite part about owning and working for Goat Lady Dairy is when customers tell him they’ve changed the way they think about food, farming and the way they care about the Earth because of their visit to the farm.

“For a long time our motto has been ‘when you change a person’s relationship to their food, you change them and the world together,’” he says. “The other joy for us is the simple pleasure of taking something so elemental as milk and crafting it into something so sensual and satisfying as artisan cheese.”

Recently, Goat Lady Dairy celebrated its 20th year producing artisan goat’s milk and cow’s milk cheeses. Goat Lady Dairy currently sells through six regional and national distributors and two local farmers markets.
In 2013, Goat Lady Dairy’s 12,000-square-foot creamery was remodeled and expanded. Tate expects Goat Lady Dairy to produce 100,000 pounds of cheese in 2015, double what was produced in 2012. The capacity is 300,000 pounds per year.

Goat Lady Dairy also has a side business of on-farm dining called Dinner at the Dairy. The company has hosted the monthly event for 20 years.

“It is a successful way for us to share our farm, our story and our products,” Tate says. “These dinners, along with our two annual Open Farm Days, bring more than 3,000 visitors to our farm every year.”

For more information, email Steve Tate at steve@goatladydairy.com or visit www.goatladydairy.com.

CMN


Rumiano Cheese Co. pursues growth with organic and brand name products

By Kate Sander

CRESCENT CITY, Calif. — On the northern California coast, at the edge of the redwoods and shrouded in fog much of the year, sits Rumiano Cheese Co., an award-winning, family-owned cheese company whose success lies in its focus on sustainability and quality — from the farms where it gets its milk to the cheese plant.

The beginnings of Rumiano Cheese date back nearly a century to 1919 when the grandfather and great-uncles of today’s owners emigrated from Italy and purchased a dairy in Willows, California.

Today the company operates its plant in Crescent City and then transports its cheese a couple of hours southeast to its distribution and packaging facility in Willows.

“Our long-term goal is to invest capital in both plants, improve sustainability, and also help the producers who supply the plant milk to be successful,” says John Rumiano, company vice president who is a majority owner of the company with his brother, Baird, who is company president.

“Without quality milk, you don’t get quality cheese,” says John’s nephew, Joby Rumiano, who leads production and marketing and works closely with the 27 dairies that supply the plant — 19 of which are conventional and eight of which are organic — to improve forage and, if appropriate, shift to organic production.

Organic is a newer focus for Rumiano Cheese. The company — which makes more than 60 varieties of cheese as well as butter, whey protein concentrate-80 percent (WPC-80) and other related dairy products — has made organic products for several years, but demand now is exploding for organic, Joby Rumiano notes. Because many of Rumiano Cheese Co.’s producers already produce milk on farms that are nearly organic, converting to organic certification is the next logical step for some, he says, noting the area’s mild climate and abundant rainfall stimulates feed growth and allows for yearlong grazing.

“We really do have the happiest cows,” Joby Rumiano says, playing off Real California Milk’s Happy Cows slogan and noting the low-stress environment in Del Norte County and nearby Humboldt County — the two counties where all of its producers are located — is perfect for raising cows and cattle. Many of the dairies from which the company buys its milk are third and fourth generation dairies that have been shipping milk to Rumiano Cheese for decades.

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Sartori, Dean, Comfy Cow are
World Dairy Expo champions

August 21, 2015

MADISON, Wis. — At this year’s World Dairy Expo Championship Dairy Product Contest, Sartori Co., Plymouth, Wisconsin, was named Cheese and Butter Grand Champion, Dean Foods Co., Rockford, Illinois, was selected as Grade A Grand Champion, and The Comfy Cow, Louisville, Kentucky, was the Ice Cream Grand Champion.

Sartori Limited Edition Pastorale Blend won top honors in the cheese and butter category. Dean Foods’ French Onion Dip was the top Grade A product. The Comfy Cow’s Brown Butter Peanut Brittle flavor was named the best ice cream.

This year’s contest, sponsored by the Wisconsin Dairy Products Association (WDPA), received a record 1,210 entries from dairy processors throughout North America. Judging was held Aug. 18-19 at the Madison Area Technical College Culinary School and Aug. 20 at the University of Wisconsin-Madison’s Babcock Hall.

“Since its inception in 2003, the World Dairy Expo Championship Dairy Product Contest has averaged a 12-percent annual rate of growth over its first 13 years,” says Brad Legreid, executive director, WDPA. “This is unprecedented growth for a dairy product contest and is a direct reflection of the high level of interest that dairy processors have in entering the only judging contest of its kind in North America.”

On Sept. 29, the first-place winners of the contest will be auctioned off during the World Dairy Expo in Madison, Wisconsin. A portion of the proceeds from the contest auction will be used to fund scholarships for students pursuing careers in the dairy industry.

The winners of each contest category include:

• Cheddar

First: AMPI, Sanborn, Iowa, Mild Cheddar, 99.55.

Second: AMPI, Jim Falls, Wisconsin, Cheddar, 99.5.

Third: AMPI, Blair, Wisconsin, Mild Cheddar, 99.4.

• Sharp Cheddar

First: Wisconsin Aging and Grading Cheese, Kaukauna, Wisconsin, Sharp Cheddar, 99.4.

Second: AMPI, Blair, Wisconsin, Sharp Cheddar, 99.25.

Third: Foremost Farms USA, Marshfield, Wisconsin, White Sharp Cheddar, 99.05.

• Aged Cheddar

First: Masters Gallery Foods Inc., Plymouth, Wisconsin, Aged Cheddar, 97.45.

Second: Masters Gallery Foods Inc., Plymouth, Wisconsin, Aged Cheddar, 96.9.

Third: Cabot Creamery Cooperative, Waitsfield, Vermont, Cabot Three Year Cheddar, 96.55.

• Colby, Monterey Jack

First: Southwest Cheese LLC, Clovis, New Mexico, Monterey Jack, 99.1.

Second: Bongards Premium Cheese, Bongards, Minnesota, Colby/Monterey Jack, 98.9.

Third: Bongards Premium Cheese, Bongards, Minnesota, Colby/Monterey Jack, 98.8.

• Swiss Styles

First: Emmi Roth USA, Fitchburg, Wisconsin, Roth Petite Swiss, 98.4.

Second: Chalet/Deppeler, Monroe, Wisconsin, 20-pound Swiss Wheel, 98.2.

Third: Edelweiss Creamery, Monticello, Wisconsin, Emmental, 98.05.

• Brick, Muenster

First: Fair Oaks Farms, Fair Oaks, Indiana, Muenster, 99.45.

Second: Babcock Hall Dairy, Madison, Wisconsin, Brick, 98.65.

Third: Edelweiss Creamery, Monticello, Wisconsin, Muenster, 98.25.

• Mozzarella

First: Lake Norden Cheese Co., Lake Norden, South Dakota, Low-Moisture, Part-Skim Mozzarella, 99.45.

Second: Foremost Farms USA, Milan, Wisconsin, Whole Milk Mozzarella, 99.35.

Third: Lactalis American Group, Buffalo, New York, Part-Skim Mozzarella, 99.3.

• Fresh Mozzarella

First: Formaggio Italian Cheese, Hurleyville, New York, Fresh Mozzarella Balls in Water, 99.85.

Second: Miceli Dairy Products, Cleveland, Ohio, Fresh Mozzarella Log, 99.1.

Third: Lioni Latticini Inc., Union, New Jersey, Fresh Mozzarella Handwrapped, 99.0.

• String Cheese

First: Burnett Dairy, Grantsburg, Wisconsin, String Cheese, 99.05.

Second: Karoun Dairies, San Fernando, California, Karoun Braided String Cheese Original, 98.65.

Third: Crave Brothers Farmstead Cheese LLC, Waterloo, Wisconsin, String Cheese, 96.85.

• Provolone

First: Dairy Farmers of America, Turlock, California, Provolone, 99.35.

Second: Foremost Farms USA, Chilton, Wisconsin, Provolone, 99.15.

Third: Dairy Farmers of America, Turlock, California, Provolone, 99.1.

• Blue Veined Cheeses

First: Arthur Schuman Inc., Fairfield, Jew Jersey, Montfort Blue Cheese Wheel, 99.15.

Second: Caves of Faribault, Faribault, Minnesota, Amagorg Cave Aged Gorgonzola, 99.0.

Third: Point Reyes Farmstead Cheese Co., Point Reyes, California, Point Reyes Original Blue, 98.15.

• Flavored Natural Cheeses

First: Mill Creek Cheese, Arena, Wisconsin, Caraway Brick, 99.5.

Second: AMPI, Jim Falls, Wisconsin, Monterey Jack with Jalapeño/Habanero Peppers, 99.4.

Third: Saputo Specialty Cheese, Richfield, Wisconsin, Team Hennings Mango Fire Cheddar, 99.25.

• Cold Pack Cheese, Cheese Food, Cheese Spread

First: Pine River Pre-Pack, Newton, Wisconsin, Port Wine Cold Pack Cheese Food, 99.6.

Second: Pine River Pre-Pack, Newton, Wisconsin, Swiss & Almond Cold Pack Cheese Food, 99.55.

Third: Pine River Pre-Pack, Newton, Wisconsin, Aged Asiago Cold Pack Cheese Food, 99.5.

• Reduced Fat

First: Foremost Farms USA, Clayton, Wisconsin, Reduced Fat Provolone, 99.55.

Second: Lactalis American Group, Nampa, Idaho, Reduced Fat String Cheese, 98.9.

Third: Foremost Farms USA, Clayton, Wisconsin, Reduced Fat Provolone, 98.85.

• Open Class Soft Cheese

First: Old Europe Cheese Inc., Benton Harbor, Michigan, Double Cream Brie, 99.55.

Second: Formaggio Italian Cheese, Hurleyville, New York, Grilled Veggies & Mozzarella, 99.2.

Third: Saputo Specialty Cheese, Richfield, Wisconsin, Team Nasonville Mediterranean Feta Cheese, 99.075.

• Open Class Semi-Soft Cheese

First: Babcock Hall Dairy, Madison, Wisconsin, Gouda, 99.6.

Second: Marieke Gouda/Holland’s Family Cheese, Thorp, Wisconsin, Marieke Gouda Belegen, 99.5.

Third: Chula Vista Cheese Co. (V&V Supremo Foods), Browntown, Wisconsin, Queso Fresco, 99.45.

• Open Class Hard Cheeses

First: Sartori Co., Plymouth, Wisconsin, Sartori Classic Asiago, 99.55.

Second: Arthur Schuman Inc., Fairfield, New Jersey, Cello Riserva Hand Crafted Asiago Cheese Wheel, 99.45.

Third: Arthur Schuman Inc., Fairfield, New Jersey, Cello Riserva Artisan Parmesan Cheese Wheel, 99.4.

• Unflavored Pasteurized Process Cheese

First: Bongards Premium Cheese, Bongards, Minnesota, American Slices, 99.2.

Second: Bongards Premium Cheese, Bongards, Minnesota, American Loaf, 98.85.

Third: AMPI, Portage, Wisconsin, Pasteurized Process Colored American Slices, 98.8.

• Flavored Pasteurized Process Cheese

First: AMPI, Portage, Wisconsin, Pasteurized Process Monterey Jack & American Cheese with Red Bell & Jalapeño Peppers, 99.35.

Second: Bongards Premium Cheese, Bongards, Minnesota, Jalapeño American Slices, 99.15.

Third: Williams Cheese Co., Linwood, Minnesota, Smoked Hot Pepper Cheese, 99.05.

• Latin American Cheese

First: Hato Potrero Farm Inc., Clewiston, Florida, Soft White Cheese, 99.65.

Second: Chula Vista Cheese Co. (V&V Supremo Foods), Browntown, Wisconsin, Chihuahua Cheese with Jalapeño Peppers, 99.6.

Third: Chula Vista Cheese Co. (V&V Supremo Foods), Browntown, Wisconsin, Chihuahua Cheese, 99.5.

• Goat’s Milk and Mixed MIlk Cheese

First: Sartori Co., Plymouth, Wisconsin, Sartori Limited Edition Pastorale Blend, 99.65.

Second: Sartori Co., Plymouth, Wisconsin, Sartori Limited Edition Extra-Aged Goat, 99.5.

Third: Woolwich Dairy USA Inc., Lancaster, Wisconsin, Original Chevrai, 99.3.

• Plain and Flavored Cream Cheese

First: Lactalis USA Inc., Merrill, Wisconsin, President Pepper Medley, 99.4.

Second: Winona Foods, Green Bay, Wisconsin, Mocha Cookies & Cream - Cream Cheese Spread, 98.95.

Third: California Dairies Inc., Visalia, California, Cream Cheese, 98.9.

• Open Class Cheese

First: Winona Foods, Green Bay, Wisconsin, Smoked Gouda with Bacon - Spread, 98.15.

Second: Saputo Specialty Cheese, Richfield, Wisconsin, Black Creek Cheddar Cheese with Parmesan Notes, 97.9.

Third: Saputo Specialty Cheese, Richfield, Wisconsin, Black Creek Double Smoked Cheddar, 97.65.

• Salted Butter

First: Foremost Farms USA, Reedsburg, Wisconsin, Salted Butter (3rd Shift), 99.15.

Second: Michigan Milk Producers Association, Constantine, Michigan, 80-percent Salted Butter, 99.1.

Third: Foremost Farms USA, Reedsburg, Wisconsin, Salted Butter (2nd Shift), 98.975.

• Unsalted Butter

First: Michigan Milk Producers Association, Constantine, Michigan, 80-percent Unsalted Butter with natural flavors, 99.5.

Second: Michigan Milk Producers Association, Constantine, Michigan, 80-percent Unsalted Butter, 99.0.

Third: Michigan Milk Producers Association, Constantine, Michigan, 80-percent Unsalted Butter with natural flavors, 98.85.

• Flavored Butter

First: Pine River Dairy, Manitowoc, Wisconsin, Cinnamon Honey Butter, 99.2.

Second: Michigan Milk Producers Association, Ovid, Michigan, Unsalted Butter with natural flavor E1, 99.1.

Third: Michigan Milk Producers Association, Ovid, Michigan, Unsalted Butter with natural flavor, 99.05.

• Open Class Butter

First: Kellers Creamery (DFA), Winnsboro, Texas, Salted Whipped Butter, 99.7.

Second: Cabot Creamery Cooperative, Waitsfield, Vermont, Cabot Whey Cream Butter, 99.05.

Third: California Dairies Inc., Visalia, California, Salted Spreadable Butter with Canola Oil, 98.7.

• White Milk

First: Oberweis Dairy, North Aurora, Illinois, White Milk, 99.95.

Second: Smith Dairy Products Co., Orrville, Ohio, 2-percent White Milk, 99.9.

Third: Country Delite Farms, Nashville, Tennessee, White Milk 2-percent, 99.875.

• Whole Chocolate Milk

First: Lamers Dairy, Appleton, Wisconsin, Whole Chocolate Milk, 99.925.

Second: Prairie Farms Dairy, Olney, Illinois, Whole Chocolate Milk, 99.9.

Third: Dean Foods - Chemong Plant, Harvard, Illinois, Whole Chocolate, 99.8.

• Lowfat Chocolate Milk

First: Prairie Farms, Dubuque, Iowa, Lowfat Chocolate Milk 1-percent, 99.85.

Second: Hiland Dairy, Kansas City, Missouri, Lowfat Chocolate Milk 2-percent, 99.75.

Third: Prairie Farms, Dubuque, Iowa, Lowfat Chocolate Milk 2-percent, 99.7.

• Fat Free Chocolate Milk

First: Upstate Niagara, Buffalo, New York, Fat Free Chocolate Milk, 100.

Second: Hiland Dairy Foods, Norman, Oklahoma, Hiland Fat Free Chocolate Half Gallon, 99.95.

Third: Prairie Farms Dairy, Holland, Indiana, Skim Chocolate Milk, 99.7.

• Cultured Milk

First: Turner Dairy Farms Inc., Pittsburgh, Cultured Milk, 99.85.

Second: Kemps, Cedarburg, Wisconsin, Kemps Buttermilk, 99.8.

Third: Guernsey Farms Dairy, Northville, Michigan, Cultured Buttermilk, 99.75.

• Open Class Milk

First: Top O’ The Morn Farms Inc., Tulare, California, Reduced Fat Orangesicle Milk, 100.

Second: Top O’ The Morn Farms Inc., Tulare, California, Whole Milk, 99.95.

Third: Sassy Cow Creamery, Columbus, Wisconsin, Whole Organic Milk, 99.75.

• Half and Half

First: Kemps, Cedarburg, Wisconsin, Kemps Half and Half, 99.9.

Second: Prairie Farms, Peoria, Illinois, Half and Half, 99.8.

Third: Upstate Niagara, Buffalo, New York, Half & Half, 99.7.

• Whipping Cream and Heavy Whipping Cream

First: Oakhurst Dairy, Portland, Maine, Fresh Heavy Cream, 99.975.

Second: Prairie Farms, Jefferson City, Missouri, Heavy Whipping Cream, 99.95.

Third: Straus Family Creamery, Petaluma, California, Whipping Cream, 99.925.

• Greek Yogurt

First: Schreiber Foods, Richland Center, Wisconsin, Greek Blueberry, 99.85.

Second: Schreiber Foods, Richland Center, Wisconsin, Peach Yogurt, 99.75.

Third: Upstate Niagara, Buffalo, New York, Pomegranate Greek Yogurt, 99.65.

• Strawberry Yogurt

First: Prairie Farms Dairy, Quincy, Illinois, Strawberry Yogurt, 99.6.

Second: Upstate Niagara, Buffalo, New York, Strawberry Low Fat Blended Yogurt, 99.15.

Third: Sierra Nevada Cheese Co., Willows, California, Graziers Strawberry Whole Milk Yogurt, 99.1.

• Blueberry Yogurt

First: Schreiber Foods, Richland Center, Wisconsin, Open Flavor, 100.

Second: Bel Fonte Ice Cream & Dairy Foods, Kansas City, Missouri, Lowfat Yogurt Blueberry, 99.65.

Third: Upstate Niagara, Buffalo, New York, Blueberry Low Fat Blended Yogurt, 99.5.

• Open Flavor Class Yogurt

First: Marquez Bothers International Inc., Hanford, California, El Mexicano Stirred Yogurt Piña Colada, 99.5.

Second: Commonwealth Dairy, Brattleboro, Vermont, Cotton Candy Blended Yogurt, 99.0.

Third: CROPP/Organic Valley, La Farge, Wisconsin, Organic Pasture Vanilla Yogurt, 98.5.

• Open Class Drinkable Yogurts

First: Hiland Dairy, Chandler, Oklahoma, Drinkable Yogurt Smoothie - Mango, 99.15.

Second: Hiland Dairy, Chandler, Oklahoma, Drinkable Yogurt Smoothie - Pomegranate, 99.1.

Third: Hiland Dairy, Chandler, Oklahoma, Drinkable Yogurt Smoothie - Piña Colada, 99.0.

• Regular Cottage Cheese

First: Prairie Farms Dairy, Quincy, Illinois, 4-percent Cottage Cheese, 99.5.

Second: Prairie Farms Dairy, Fort Wayne, Indiana, Cottage Cheese Nonfat, 99.1.

Third: Dean Foods Co., Rockford, Illinois, 4-percent Large Curd Cottage Cheese, 97.85.

• Lowfat and No Fat Cottage Cheese

First: Prairie Farms Dairy, Quincy, Illinois, 2-percent Cottage Cheese, 99.45.

Second: Prairie Farms Dairy, Carbondale, Illinois, Cottage Cheese Nonfat, 98.45.

Third: Umpqua Dairy Products, Roseburg, Oregon, Low Fat Cottage Cheese, 98.4.

• Open Cottage Cheese Class

First: Upstate Niagara, Buffalo, New York, Pineapple Cottage Cheese, 98.75.

Second: Hiland Dairy Foods, Wichita, Kansas, Open Cottage Cheese Class, 98.5.

Third: Super Store Industries, Turlock, California, Open Cottage Cheese Class (Fruit at the Bottom) Pineapple, 97.75.

• Sour Cream

First: Marquez Brothers International Inc., Hanford, California, El Mexicano Creama Mexicana: Dairy Based Sour Cream, 99.55.

Second: Turner Dairy Farms Inc., Pittsburgh, Sour Cream, 99.45.

Third: UMPQUA Dairy Products, Roseburg, Oregon, Sour Cream, 99.425.

• Lowfat Sour Cream

First: Cabot Creamery Cooperative, Waitsfield, Vermont, Cabot Low-Fat Sour Cream, 99.3.

Second: Prairie Farms, Carbondale, Illinois, Fat Free Sour Cream, 99.25.

Third: Kemps, Cedarburg, Wisconsin, Kemps Light Sour Cream 16-ounce, 99.1.

• Sour Cream Based Dips-Onion

First: Dean Foods Co., Rockford, Illinois, French Onion Dip, 100.

Second: Hiland Dairy, Chandler, Oklahoma, French Onion Dip, 99.8.

Third: Prairie Farms Dairy, Quincy, Illinois, French Onion Dip, 99.675.

• Sour Cream Based Dips-Southwest

First: Kemps LLC, St. Paul, Minnesota, MDAM - Top the Tater - Fiesta Dip, 100.

Second: Prairie Farms Dairy, Fort Wayne, Indiana, Jalapeño Fiesta Dip, 99.65.

Third: Cabot Creamery Cooperative, Waitsfield, Vermont, Salsa Grande Dip, 99.0.

• Sour Cream Based Dips-Ranch

First: Prairie Farms Dairy, Carbondale, Illinois, Sour Cream Ranch Veggie, 99.3.

Second: Brookshire Grocery Co., Tyler, Texas, Sour Cream Dip - Ranch, 98.6.

Third: Hiland Dairy Foods, Norman, Oklahoma, Hiland Veggie Ranch Dip 16-ounce, 98.45.

• Open Sour Cream Based Dips Class

First: Hiland Dairy Foods, Omaha, Nebraska, Rockin Ranch with Dill, 99.9.

Second: Prairie Farms Dairy, Fort Wayne, Indiana, Bacon Cheddar Dip, 99.75.

Third: Dean Foods Co., Rockford, Illinois, Chive & Onion Dip, 98.95.

• Regular Vanilla Ice Cream

First: Chocolate Shoppe Ice Cream, Madison, Wisconsin, Old Fashioned Vanilla, 100.

Second: Sassy Cow Creamery, Columbus, Wisconsin, Regular Vanilla Ice Cream, 99.075.

Third: Kwik Trip Inc., La Crosse, Wisconsin, Regular Vanilla Ice Cream, 98.55.

• French Vanilla Ice Cream

First: Giffords Famous Ice Cream, Showhegan, Maine, French Vanilla Ice Cream, 99.85.

Second: Double Rainbow Ice Creams Inc., San Francisco, Organic French Vanilla Ice Cream, 99.8.

Third: Cedar Crest Specialties, Manitowoc, Wisconsin, French Vanilla, 99.65.

• Philly Vanilla Ice Cream

First: Giffords Famous Ice Cream, Showhegan, Maine, Vanilla Bean Ice Cream, 99.5.

Second: Fair Oaks Farms (Fairlife LLC), Fair Oaks, Indiana, Vanilla Bean Ice Cream, 99.0.

Third: Stewart’s, Saratoga Springs, New York, Philly Vanilla, 97.5.

• Regular Chocolate Ice Cream

First: Muller Pinehurst/Prairie Farms Dairy, Rockford, Illinois, Regular Chocolate Ice Cream, 99.9.

Second: Hiland Dairy Foods, Springfield, Missouri, Chocolate Square 56-ounce, 99.85.

Third: Fair Oaks Farms (Fairlife LLC), Fair Oaks, Indiana, Chocolate Ice Cream, 99.8.

• Dark Chocolate Ice Cream

First: Chocolate Shoppe Ice Cream, Madison, Wisconsin, Zanzibar Chocolate Ice Cream, 99.5.

Second: King Cone, Plover, Wisconsin, Zanzee Chocolate Bar, 98.0.

Third: Double Rainbow Ice Creams Inc., San Francisco, Ultra Chocolate Ice Cream, 97.5.

• Open Class Ice Cream

First: The Comfy Cow, Louisville, Kentucky, Brown Butter Peanut Brittle, 100.

Second: Southeastern Grocers, Jacksonville, Florida, Prestige Coconut Almond Fudge Ice Cream, 99.9.

Third: Brookshire Grocery Co., Tyler, Texas, Open Class Ice Cream, 99.8.

• Open Class Sherbet

First: Cedar Crest Specialties, Manitowoc, Wisconsin, Sunset Rainbow Sherbet, 100.

Second: Cedar Crest Specialties, Manitowoc, Wisconsin, Raspberry Sherbet, 99.875.

Third: Cedar Crest Specialties, Manitowoc, Wisconsin, Pineapple Sherbet, 99.5.

• Frozen Yogurt

First: Kwik Trip Inc., La Crosse, Wisconsin, Frozen Yogurt, 99.875.

Second: Kemps, St. Paul, Minnesota, Frozen Yogurt - Chocolate Peanut Butter Cup, 98.75.

Third: Kemps, St. Paul, Minnesota, Frozen Yogurt - Raspberry Chocolate, 98.5.

• Gelato

First: Stewart’s, Saratoga Springs, New York, Salty Caramel Gelato, 99.275.

Second: Caffe Classico Foods LLC, Concord, California, Gelato Classico Strawberry Fresca Gelato, 99.0.

Third: Stewards, Saratoga Springs, New York, Blackberry Gelato, 98.7.

• Whey

First: Saputo Cheese USA Inc., Waupun, Wisconsin, Sweet Whey Powder, 99.1.

Second: AMPI, Blair, Wisconsin, Dried Sweet Whey, 99.05.

Third: Foremost Farms USA, Plover, Wisconsin, Demineralized Sweet Whey (D90), 99.0.

• Whey Permeate

First: Saputo Cheese USA Inc., Waupun, Wisconsin, Whey Permeate - Regular, 99.9.

Second: Lactalis American Group, Buffalo, New York, Whey Permeate, 99.8.

Third: AMPI, Paynesville, Minnesota, Whey Permeate, 99.75.

• WPC-34 Percent

First: Foremost Farms USA, Plover, Wisconsin, 99.9.

Second: Saputo Cheese USA Inc., Waupun, Wisconsin, 99.8.

Third: AMPI, Paynesville, Minnesota, 99.15.

• WPC-80 Percent

First: Lactalis American Group, Nampa, Idaho, WPC 80-percent protein, 99.8.

Second: Saputo Cheese USA, Waupun, Wisconsin, WPC 80-percent instant, 99.4.

Third: CROPP/Organic Valley, La Farge, Wisconsin, Organic WPC 80-percent, 99.33.

• Whey Protein Isolates

First: Gallo Global Nutrition, Atwater, California, 99.9.

Second: Agropur Inc., Luxemburg, Wisconsin, 99.6.

Third: Lactalis American Group, Nampa, Idaho, 99.0.

• Nonfat Dried Milk

First: Dairy Farmers of America - Quail Hollow, Fallon, Nevada, Instantized Whole Milk Powder, 99.8.

Second: Dairy Farmers of America - Quail Hollow, Fallon, Nevada, Skim Milk Powder LH, 99.75.

Third: Dairy Farmers of America - Quail Hollow, Fallon, Nevada, While Milk Powder MH, 99.7.

• Open Class for Creative and Innovative Products

First: Power Foods LLC, Barneveld, Wisconsin, Moxie Munch, 99.8.

Second: Klondike Cheese Co., Monroe, Wisconsin, Feta & Greek Yogurt Olive Spread, 99.7.

Third: Galloway Co., Neenah, Wisconsin, Arnold Palmer Pop, 99.65.

CMN


Some price recovery is seen
at Global Dairy Trade auction

August 21, 2015

AUCKLAND, New Zealand — Following months of declining prices, the Global Dairy Trade (GDT) price index rose 14.8 percent at Tuesday’s auction, its first increase since March.

“The sharp decline on the GDT price index that began back in March has officially come to an end,” says Eric Meyer, president, HighGround Dairy, Chicago.

Meyer notes that after lower prices for 11 consecutive trading events, whole milk powder (WMP) — along with most other GDT commodities — responded to Fonterra’s recent reduction in forecast volumes and posted sharp percentage increases. (See “GDT quantity forecasts lowered in face of changing conditions” in last week’s issue of Cheese Market News.)

“So far, the recent GDT event has many earmarks of a corrective bounce,” says Dave Kurzawski, senior broker with FCStone, Chicago. “After the previous three events in which the index lost some 36 percent of value, a rebound in light of volume reductions was expected.”

The average price achieved across all contracts and contract periods Tuesday for all commodities is as follows:

• Anhydrous milkfat: US$2,724 per metric ton FAS ($1.2356 per pound), up 26.6 percent.

• Butter: US$2,541 per metric ton FAS ($1.1526 per pound), up 10.8 percent.

• Buttermilk powder: US$1,400 per metric ton FAS ($0.6350 per pound), down 13.8 percent.

• Cheddar: US$2,778 per metric ton FAS ($1.2601 per pound), up 4.4 percent.

• Lactose: US$502 per metric ton FAS ($0.2277 per pound), down 7.8 percent.

• Rennet casein: US$5,441 per metric ton FAS ($2.4680 per pound), up 3.0 percent.

• Skim milk powder: US$1,521 per metric ton FAS ($0.6899 per pound), up 8.5 percent.

• WMP: US$1,856 per metric ton FAS ($0.8419 per pound), up 19.1 percent.

Meyer says that GDT buyers likely interpreted Fonterra’s lower volumes as a catalyst to buy.

“It is quite possible that a bottom may have been set during the first GDT auction in August, but market participants should be cautious to interpret (this week’s) sharply higher GDT as a sign of things to come,” he says. “While there may be a little follow-through over the next auction or two, the impressive percentage gains are simply a result of extremely low prices, and nothing has materially changed in the supply/demand balance.”

Meyer adds that HighGround maintains a view that the upside to dairy commodity prices is somewhat limited until proof of global supply contraction is evident.

Kurzawski notes that the recent news of Russia lifting its ban on 29 companies in New Zealand also likely had a hand in recent price action. (See article in this issue.)

“The news out of Russia has been largely written off by market participants because of the potential political implications of resuming business,” he adds. “Don’t believe it. Given the climate of global dairy trade, any new business is welcomed business.”

The next GDT auction will be held Sept. 1. For more information, visit www.globaldairytrade.info.

CMN


U.S. milk production rises
1.2 percent in July report

August 21, 2015

WASHINGTON — Milk production in the 23 major milk-producing states in July totaled 16.58 billion pounds, up 1.2 percent from July 2014, according to preliminary data released this week by USDA’s National Agricultural Statistics Service (NASS). (All figures are rounded. Please see CMN’s Milk Production chart.)

Revised June milk production in the 23 major milk-producing states was 16.39 billion pounds, up 0.9 percent from June 2014. The June revision represents an increase of 40 million pounds or 0.2 percent from last month’s preliminary production estimate.

Production per cow in the 23 major states averaged 1,921 pounds in July, 12 pounds above July 2014. This is the highest production per cow for the month of July since the 23-state series began in 2003, NASS says. The number of milk cows on farms in the 23 major states was 8.63 million head, 47,000 head more than July 2014 and 2,000 head more than June 2015.

For the entire United States, milk production during July totaled 17.65 billion pounds, up 1.2 percent from July 2014. Production per cow in the United States averaged 1,893 pounds in July, 12 pounds above July 2014. The number of milk cows on farms in the United States was 9.32 million head, 54,000 head more than July 2014 and 1,000 head more than June 2015.

California led the nation’s milk production with 3.41 billion pounds in July, down 3.3 percent from its production a year earlier. There were 1.78 million cows on California farms in July, 1,000 head less than a year earlier and unchanged from a month earlier. Production per cow averaged 1,915 pounds, down 65 pounds from July 2014.

Wisconsin followed with 2.50 billion pounds of milk in July, up 5.3 percent from its production a year earlier. Wisconsin was home to 1.28 million cows in July, 9,000 head more than in July 2014 and unchanged from June 2015. Production per cow averaged 1,955 pounds in July, NASS reports, up 85 pounds from a year earlier.

CMN


CDR review says no evidence
of raw milk benefits

August 21, 2015

MADISON, Wis. — A recently-published critical review of more than 50 scientific articles finds no convincing evidence to suggest that the consumption of raw milk provides any health benefits related to improved nutrition, lactose intolerance or better digestion.

The article, “Raw Milk Consumption: Risks and Benefits,” was published in the July/August 2015 issue of Nutrition Today. Author John Lucey, Wisconsin Center for Dairy Research director and University of Wisconsin-Madison Food Science professor, reviewed some of the common suggested health benefits that have been made by some members of the public and media regarding the benefits of raw milk consumption.

Lucey, who has more than 25 years of dairy research experience and has published more than 100 peer-reviewed papers, reviewed more than 50 scientific articles related to raw milk and read various websites from groups that advocate for raw milk consumption. He concluded that there is no convincing evidence of the claimed benefits of raw milk and points out that because of how and where it is produced, it is not inherently safe and carries a significant and well-documented food poisoning risk.

According to Lucey, “the increase in the popularity of raw milk consumption is a significant concern because surveys of raw milk have shown that it routinely contains human pathogens which cause serious illness every year and even death in some cases. Popular claims about its health benefits are unsubstantiated myths. Pasteurized milk has an excellent safety record and provides wonderful nutrition.”

Lucey notes that even milk from healthy cows can contain pathogens due to possible contamination during milking or storage. Pasteurization destroys these harmful bacteria and is widely considered a major step forward in improving public health.

The article can be viewed at http://journals.lww.com/nutrition
todayonline/Fulltext/2015/07000/Raw_Milk_Consumption__Risks_and_Benefits.10.aspx.

CMN


Research, diet trends shifting
consumer views on dairy fat

August 14, 2015

By Rena Archwamety

MADISON, Wis. — As new research on nutrition emerges, natural fats — including dairy fat — have started to join the “in” crowd of diet trends.

Recently-published books that promote dairy fats as part of a healthy diet have landed on best-seller lists. The Big Fat Surprise: Why Butter, Meat & Cheese Belong in a Healthy Diet, by Nina Teicholz, claims more, not less, dietary fat — including saturated fat that is found in dairy — leads to better health, wellness and fitness. The Bulletproof Diet by Dave Asprey, who popularized the buttered coffee trend, incorporates full-fat, grass-fed dairy items as sources of “healthy fats.” And the cover of a 2014 Time issue depicting a glowing butter roll against a black background featured the message, “Eat Butter.”

The inclusion of natural fats in mainstream diet advice has changed the image of dairy products in the eyes of many consumers, says Greg Miller, chief science officer, National Dairy Council.

“There is increased consumption of whole fluid milk and whole milk yogurts,” Miller says. “With cheese, it lets people understand, ‘Yeah, there’s fat in cheese, but it’s not necessarily bad for me.’ They’re also getting calcium, protein and other nutrients, so they can feel better and more comfortable with cheese consumption.”

Much of this shift in attitudes toward fats is based on research that has suggested that fat is not as harmful as many previously thought, and in some cases might actually provide benefits as part of a healthy diet.

“For many years, the focus has been to lower saturated fat in the diet from all food sources in an effort to lower serum cholesterol levels to decrease coronary heart disease. Higher levels of serum cholesterol are associated with heart disease, and saturated fats tend to increase cholesterol levels, so saturated fats were assumed to increase risk for coronary heart disease,” says Sonya Angelone, registered dietitian nutritionist and spokesperson for the Academy of Nutrition and Dietetics.

“However, over the years, scientists have discovered that not all saturated fatty acids have the same effect on serum cholesterol. Fatty acids, the building blocks of fats, come in different lengths which make a difference in how they are metabolized. Stearic acid, for example, is the most abundant fatty acid in milk and doesn’t tend to raise serum cholesterol like other saturated fat acids. So, the science around saturated fats and heart disease is evolving.”

A study by Canadian researchers published this week in the British Medical Journal (BMJ) found that while trans fats — which FDA recently banned in processed foods — are associated with greater risk of death and coronary heart disease (CHD), saturated fats are not associated with an increased risk of death, heart disease, stroke or Type 2 diabetes. The researchers say because their results are based on observational studies, no definitive conclusions can be drawn about cause and effect. However, they write that their analysis “confirms the findings of five previous systematic reviews of saturated and trans fats and CHD.”

A 2013 study by Seattle-based researchers published in the European Journal of Nutrition reviewed observational studies on the relationship between dairy fat and high-fat dairy foods, obesity and cardiometabolic disease. This study suggests that dairy fat or high-fat dairy foods did not contribute to obesity or cardiometabolic risk. In fact, its findings suggested that high-fat dairy consumption with typical dietary patterns was related in decreased risk of obesity.

“Although not conclusive, these findings may provide a rationale for future research into the bioactive properties of dairy fat and the impact of bovine feeding practices on the health effect of dairy fat,” the authors of the study write.

Miller says the National Dairy Council currently is working on research to figure out if there are specific properties of dairy fat that could have a positive impact on health.

“There is some evidence around specific fatty acids. Butyric acid may be good for gut health. Conjugated linoleic acid, which is found in small amounts in milkfat, also may be beneficial. There’s no definitive data now, but there is some science that indicates that there may be benefits to milkfat consumption.”

Angelone notes that while there is a trend toward eating more saturated fats, some of the research behind this trend is flawed.

“The study that started the trend decreased saturated fats in the diet of test subjects but replaced the calories with sugar/simple carbohydrates, and they had more heart disease. The people eating more saturated fats had less heart disease. The conclusion was that decreasing saturated fats was not a good idea,” she says. “However, what is important is what replaces the saturated fat. If simple carbs replace the saturated fat, the diet is less healthful. A healthful diet is one that can include some saturated fats especially from cheese and yogurt but little simple carbs (little sugar and refined carbs) and plenty of fiber from produce, nuts and some whole grains.”

Angelone says she considers dairy fat “neutral” in the sense that it can be beneficial for some people but not so healthful for others. She OKs the intake of regular cheeses and yogurts for clients but doesn’t encourage much whole milk. She cautions people who are overweight to be careful of portion sizes of higher-fat dairy products. She also says people with a certain genetic trait that increases their risk for Alzheimer’s disease seem to do better with a lower-fat diet.

With science on dairy fat still emerging, Miller says he doesn’t see the dairy industry promoting health claims around full-fat products yet, though he does see more full-fat dairy items, particularly yogurts, appearing in the marketplace to meet consumer demand.

Demand for whole milk also is rising, Dean Foods CEO Gregg Tanner noted during a conference call earlier this week.

“We are seeing trends more toward whole milk and less around fat-free or lowfat,” Tanner says, adding that this is contributing to higher cream costs.

“As much as we would like to see people go toward whole milk and drink more milk in general, the implications of that have been playing out in the marketplace today with higher cream costs,” he says. “With more whole milk in the marketplace vs. skim, there is less cream. We’re paying the highest multiples we’ve paid on cream in quite some time.”

Angelone and Miller both stress that the recent health glow around full-fat dairy does not mean people can incorporate unlimited amounts of dairy fat in a healthy diet.

“I agree that dairy fat can be part of a heart healthy diet but caution on the overall amount,” Angelone says. “This is not permission to eat large quantities of it. Certain foods like whole fat cheeses can be very satisfying and enjoyable, and there is a place for these foods in people’s diets.”

Miller says balance, variety and moderation still should be followed when it comes to dairy fat.
“It doesn’t mean they should go out and put a half a stick of butter in their coffee every day,” he says. “The Dietary Guidelines for Americans says to include three servings of dairy a day as part of a healthy diet, and that’s where recommendations have stayed. Can it be whole milk dairy products? Science is beginning to say that’s probably OK.”

CMN


GDT quantity forecasts lowered
in face of changing conditions

August 14, 2015

AUCKLAND, New Zealand — Fonterra Cooperative Group Ltd. on Thursday announced it is significantly reducing its Global Dairy Trade (GDT) offer quantity forecasts for the next 12 months.

Fonterra’s forecast offer volumes over the next 12 months for New Zealand products have been decreased by a further 56,045 metric tons with a 62,903-metric ton decrease occurring over the next three months and 6,885 metric tons of planned volumes being added back later in the year in anticipation of changing market conditions, the cooperative says.

GDT, Fonterra’s Internet-based sales platform, continued its downward trend with extremely bearish results at last week’s auction. Fonterra last week also lowered its forecast farmgate milk price for 2015-2016 to NZ$3.85 per kilogram of milk solids, down from a previous forecast of NZ$5.25 per kilogram. (See “Bearish global market, lower U.S. exports may affect prices” in last week’s issue of Cheese Market News.)

Kelvin Wickham, Fonterra managing director, global ingredients, says the changes come in response to current conditions on both the demand and supply sides of the global dairy market.

“In response to current market conditions in the global dairy markets, we have further modified our product mix to shift volumes away from base whole milk powder (WMP) and into our other products in our portfolio such as value-added ingredients, consumer and foodservice,” Wickham says. “In terms of our product mix, Fonterra is now selling approximately 70 percent of its total product via channels other than GDT and as a result we do not expect a material impact on inventories.”

He adds that from a supply perspective, Fonterra’s reduction of GDT volumes reflects the latest production forecast for the coming season where the cooperative currently expects its farmers to reduce milk supply by at least 2 percent.

Fonterra says this reflects the likely impact of farmers using more traditional practices to manage their farm businesses within the limits of a low payout forecast. The cooperative adds that, despite recent low prices, GDT continues to be a credible and transparent mechanism for international price discovery.

Eric Meyer, president of HighGround Dairy, Chicago, says the firm’s take is that Fonterra is taking strong steps to stabilize the market and keep farmer confidence intact.

“Given the recent bounce to NZX futures this past week, it is likely WMP will find support on GDT (at next week’s auction), but HighGround is not expecting sharply higher prices as a result of today’s announcements,” he says.

Following the latest GDT auction results last week, Wickham tweeted the following, responding to a Twitter conversation around the latest result: “No one likes low prices, but (it’s) important to remember GDT has not caused low prices — they’re a reflection of what’s happening in the market.

“Nearly all of the product offered on GDT this week sold to willing buyers. There is a supply/demand imbalance, and that’s what you’re seeing on GDT. Particularly, constraints on demand from big dairy importing countries (China slowdown and inventories, Russia import bans) … and milk supply continues to grow in Europe and (the United States), which is spilling over into soft global demand. We’re doing everything to move powder and other commodity products into higher-value contracts and higher margin products,” Wickham tweeted.

“And to those calling for GDT to be suspended, that’s not going to solve the supply/demand imbalance. Thanks — during this time we’ve got to pull together as a co-op and support our farmers. Demand will come back,” he adds.

Fonterra also was notified this week that rating agency Standard & Poor’s has placed the cooperative’s credit rating on credit watch.

Standard & Poor’s says the decision reflects weakening global dairy market conditions.

“Fonterra has taken proactive and positive steps to maintain the financial strength of the co-op,” says Lukas Paravicini, CEO, Fonterra. “We have continued to exercise financial prudence and discipline in challenging times for dairy globally.”

He adds that while current global prices are unsustainably low, the cooperative takes a longer-term view of the cyclical nature of the international dairy market and has confidence in the fundamentals for dairy.

Meanwhile, GDT this week announced that Arden Hills, Minnesota-based cooperative Land O’Lakes has formally withdrawn from the global auction platform.

Land O’Lakes first joined GDT in March 2014 offering skim milk powder. The cooperative last sold product via the platform in January and has not offered product on the platform for the last six months.

GDT Director Eric Hansen says Land O’Lakes has now decided to focus resources on other sales channels for this product range. Land O’Lakes did not respond to requests for comment by press time.

“We understand the reasons for Land O’Lakes’ decision, and we would certainly welcome them back in the future should they wish to utilize our service,” Hansen says.

CMN


Montchevré-Betin named
Master at contest auction

August 7, 2015

WEST ALLIS, Wis. — Team Montchevré, Montchevré-Betin, Belmont, Wisconsin, was named the 2015 Grand Master Cheese Maker during the Blue Ribbon Cheese & Butter Auction Aug. 13 at the Wisconsin State Fair Park.

Jean Rossard, representing Team Montchevré, earned this year’s title for the company’s Blueberry Vanilla Goat Cheese, which placed first in the Flavored Goat Milk Cheese class at the Wisconsin State Fair Cheese & Butter Contest held earlier this summer. Susan Quarne, Publisher, Cheese Market News, Middleton, paid the largest per pound price of the night of $185 to buy 10 pounds of the winning cheese for $1,850.

Each blue-ribbon entry from the contest was auctioned off, and these sales raised a total of $27,935 for student scholarships and Wisconsin State Fair dairy promotions.
Other auction results include:

Mild Cheddar: Jeff Berg, Land O’Lakes, Kiel, made the 40 pounds of Mild Cheddar purchased by Masters Gallery Foods, Plymouth, for $20 per pound for a total of $800.

Swiss Styles: Silvan Blum, Chalet Cheese Co-op, Monroe, made the 20-pound Swiss Wheel purchased by Saputo Specialty Cheese, Richfield, for $80 per pound for a total of $1,600.

Flavored Soft Cheese: Tony Gessler, Lactalis USA, Merrill, made the 12 pounds of Garlic & Herbs Spread purchased by Wisconsin State Fair Park Board, West Allis, for $25 per pound for a total of $300.

Open Class for Hard Cheese: Joel Pagel, Sartori Co., Antigo, made the 20 pounds of Classic Asiago purchased by Alpma USA, Milwaukee, for $100 per pound for a total of $2,000.

Blue Veined Cheese: Team Salemville, Saputo Specialty Cheese, Richfield, made the 12 pounds of Reserve Blue purchased by WE Energies Foundation, Milwaukee, for $50 per pound for a total of $600.

Pasteurized Process Cheese, Cheese Food, Spread: Process Cheese Team, Associated Milk Producers Inc., Portage, made the 10 pounds of Pasteurized Process American purchased by Wisconsin Aging and Grading Cheese, Kaukauna, for $45 per pound for a total of $450.

Sheep & Mixed Milk Cheese: Mike Matucheski, Sartori Co., Antigo, made the 20 pounds of Pastorale Blend purchased by Berenz Packaging, Menomonee Falls, for $50 per pound for a total of $1,000.

Cold Pack Cheese, Cheese Food: Joey Widmer, Widmer’s Cheese Cellars, Theresa, made the 10 pounds of Aged Brick Spread purchased by Wisconsin Aging and Grading Cheese, Kaukauna, for $70 per pound for a total of $700.

String Cheese: Cesar Luis, Cesar’s Cheese, Columbus, made the 10 pounds of Hand-Stretched String Cheese purchased by Metcalfe’s Market, Madison, for $100 per pound for a total of $1,000.

Flavored Semi-Soft Cheese: John (Randy) Pitman, Mill Creek Cheese, Arena, made the 10 pounds of Caraway Brick purchased by Saz’s, Milwaukee, for $60 per pound for a total of $600.

Smear Ripened Cheese: Andy Hatch, Uplands Cheese, Dodgeville, made the 10 pounds of Pleasant Ridge Reserve purchased by Dairy Connection, Madison, for $55 per pound for a total of $550.

Reduced Fat or Lite Cheese: Jim Demeter, Klondike Cheese Co., Monroe, made the 10 pounds of Reduced Fat Mediterranean Feta purchased by Alpma USA, Milwaukee, for $45 per pound for a total of $450.

Brick, Muenster: Gary Grossen, Babcock Hall Dairy Plant, Madison, made the 11 pounds of Brick purchased by Rock River Labs, Watertown, for $75 per pound for a total of $825.

Open Class for Semi-Soft Cheese: Brett Krattiger, Maple Leaf Cheese Co-op, Monroe, made the 12 pounds of Gouda purchased by Dairy Connection, Madison, for $55 per pound for a total of $660.

Colby, Monterey Jack: Kerry Henning, The Artisan Cheese Exchange, Sheboygan, made the 12 pounds of Colby purchased by Ivarson Inc., Milwaukee, for $60 per pound for a total of $720.

Natural Goat Milk Cheese: Pam Hodgson, Sartori Co., Plymouth, made the 20 pounds of Extra-Aged Goat Cheese purchased by Nelson-Jameson, Marshfield, for $50 per pound for a total of $1,000.

Mozzarella: George Crave, Crave Brothers Farmstead Cheese, Waterloo, made the 12 pounds of Part Skim Mozzarella Ball purchased by WE Energies Foundation, Milwaukee, for $80 per pound for a total of $960.

Latin American Cheese: Sam Sweeney, Chula Vista Cheese, Browntown, made the 10 pounds of Queso Quesadilla purchased by Nelson-Jameson, Marshfield, for $135 per pound for a total of $1,350.

Flavored Havarti: Ben Workman, Edelweiss Creamery, Monticello, made the 10 pounds of Dill Havarti purchased by Dairy Connection, Madison, for $95 per pound for a total of $950.

Aged Cheddar: Terry Lensmire, Agropur, Weyauwega, made the 42 pounds of Aged Cheddar purchased by Saz’s, Milwaukee, for $60 per pound for a total of $2,520.

Smoked Cheese: Walter Hartwig, Zimmerman Cheese, South Wayne, made the 12 pounds of Smoked Brick purchased by Masters Gallery Foods, Plymouth, for $55 per pound for a total of $660.

Feta: Jim Demeter, Klondike Cheese Co., Monroe, made the 10 pounds of Feta in Brine purchased by DSM Food Specialties, Waukesha, for $100 per pound for a total of $1,000.

Flavored Pepper Cheese: Heriberto Nickolas, Maple Leaf Cheese Co-op, Monroe, made the 12 pounds of Chipotle White Cheddar purchased by Berenz Packaging, Menomonee Falls, for $120 per pound for a total of $1,440.

Flavored Hard Cheese: Mike Matucheski, Sartori Co., Antigo, made the 20 pounds of Merlot BellaVitano purchased by Chr. Hansen, Milwaukee, for $75 per pound for a total of $1,500.

Open Class for Soft & Spreadable Cheese: Shawn Schult, Lactalis USA, Merrill, made the 12 pounds of Whipped Cream Cheese purchased by Rock River Labs, Watertown, for $25 per pound for a total of $300.

Havarti: Bruce Workman, Edelweiss Creamery, Monticello, made the 10 pounds of Havarti purchased by Chr. Hansen, Milwaukee, for $105 per pound for a total of $1,050.

Butter: Don Much, Grassland Dairy Products, Greenwood, made the 10 pounds of Salted Butter purchased by Ivarson Inc., Milwaukee, for $110 per pound for a total of $1,100.

CMN


Dean Foods chair resigns,
company announces results

August 14, 2015

DALLAS — Dean Foods Co. announced last Friday that chairman Tom Davis resigned from the board of directors. During Monday’s conference call on the company’s second quarter financial results, Dean Foods CEO Gregg Tanner acknowledged Davis’ 14 years of service but declined to add any more information.

“I have nothing further I can add, other than the fact that we feel more optimistic than ever about the future of Dean Foods,” Tanner said in response to a question about Davis’ sudden departure.
The Wall Street Journal reported Wednesday that Davis is being investigated for insider trading related to the 2012 spinoff of WhiteWave Foods.

Dean Foods spokesperson Jamaison Schuler confirmed to Cheese Market News that the company has cooperated with the government’s requests for information and will continue to do so, and that Davis’ resignation was voluntary.

“Because there is an ongoing government investigation, it would be inappropriate to comment further at this time,” Schuler says.

On Wednesday, Dean Foods named Jim L. Turner, principal of JLT Beverages L.P. and owner and CEO of JLT Automotive Inc., as its new non-executive chairman of the board. Turner has been part of Dean Foods’ board of directors since November 1997.

Dean Foods reported second quarter diluted earnings per share (EPS) of $0.28 for the three months ended June 30, up from a loss of $0.01 per share during the second quarter of 2014. Adjusted EPS was $0.33 in the second quarter, compared to a loss of $0.14 during the same quarter last year.

Net sales for the second quarter were $2.01 billion, down from $2.39 billion during last year’s second quarter. Gross profit for Dean Foods’ second quarter totaled $495.6 million, up from $399.1 million in last year’s second quarter. Net income totaled $26.5 million in the second quarter, compared to a loss of $645,000 a year earlier. Adjusted net income in the second quarter totaled $31.8 million, up from a loss of $12.7 million in the same period last year.

Dean Foods stepped up its advertising and marketing supports with the second-quarter launch of its DairyPure national brand of white milk. (See “Dean Foods Co. launches national branded milk” in the May 8, 2015, issue of Cheese Market News.) The company says third-quarter adjusted diluted earnings are expected to be $0.17 to $0.27 per share.

“I’m very pleased with the operational and financial performance of the business this quarter and really excited about our prospects going forward,” Tanner says. “Across our supply chain, we continued to execute our cost productivity agenda and utilize our scale to procure ingredients and packaging at industry leading levels, optimize our production network and reduce our logistics cost. From a commercial perspective, with the category showing signs of improvement, we continued to focus on striking the right balance between volume performance and price realization.”

CMN


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Today's Cheese Spot Trading
August 31, 2015


Barrels: $1.6100 (+1)
Blocks: $1.7300 (+3)


Click here for more market activity
Cheese Production
U.S. Total June
959.014 mil. lbs.


Milk Production
U.S. Total July
17.650 bil. lbs.

Guest Columnist

Remembering dairy shows

Connie Tipton is president and CEO of the International Dairy Foods Association.

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