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House fails to pass farm bill due to controversial proposals

May 18, 2018

WASHINGTON — Today the 2018 Farm Bill failed to pass in the U.S. House by a reported vote of 198-213.

Stakeholders have noted while there was widespread support for the bill in the agriculture community, there were disagreements between House Republicans and Democrats on some of the Supplemental Nutrition Assistance Program (SNAP) provisions. Meanwhile, the bill included several provisions of importance to the ag and dairy sectors, including risk management for fluid milk, the producer safety net and dairy incentives in SNAP.

For example, text in the House bill said that no later than 60 days after the date of enactment of the 2018 Farm Bill, the secretary of agriculture shall submit to the House and Senate agriculture committees a report evaluating the extent to which the average cost of feed used by a dairy operation to produce a hundredweight of milk is representative of actual dairy feed costs.

However, some amendments also were cause for concern for dairy and agricultural stakeholders. In a letter sent May 9 to U.S. house members, more than 300 organizations including the National Milk Producers Federation (NMPF) and American Farm Bureau Federation voiced strong opposition to amendments that could critically hurt farm families during House floor consideration of the farm bill.

The groups noted that while a number of potentially harmful proposals have surfaced in recent weeks, three possible amendments most frequently reported on by the media proposed to gut crop insurance, undermine sugar policy and impose unworkable payment limits.

Friday morning, one major amendment that the dairy industry opposed was defeated prior to the failure of the entire farm bill. Amendment 30, which would have removed existing regulations that prohibit the interstate sale of raw milk for direct human consumption, failed in the House by a vote of 331 against to 79 in favor.

The Wisconsin Cheese Makers Association (WCMA) earlier this week had urged lawmakers to oppose this amendment.
“Doctors and microbiologists have long recognized the substantial public health risks associated with raw milk,” says John Umhoefer, WCMA executive director. “It’s troubling that any elected official would ignore that potentially deadly threat.”

WCMA noted that according to the Centers for Disease Control and Prevention, from 1998 through 2011, consumption of raw milk triggered 148 outbreaks which resulted in 2,384 illnesses, 284 hospitalizations and two deaths. Most of these illnesses were caused by E. coli, Campylobacter, Salmonella, or Listeria.

Umhoefer noted that, along with the concern for consumer safety, interstate sales of raw milk also pose a secondary concern for economic security. The U.S. dairy industry currently accounts for $207 billion in economic activity, including a $43 billion impact in Wisconsin alone.

“Any foodborne illness outbreak caused by raw milk threatens not only sales of liquid milk, but also the sales of all dairy products,” he says.

One of the most contentious elements of the farm bill would have dramatically revamped SNAP by restricting eligibility and requiring millions of low-income Americans who receive nutritional assistance to work at least 20 hours a week or enroll in a job training program.

Democrats opposed those changes, saying that many food stamp recipients already work and the new requirements could cost families vital nutritional assistance.

In a statement on the House floor Wednesday, K. Michael Conaway, R-Texas, chair of the House Ag Committee, said it was no secret that Congress did not have a bipartisan farm bill process.

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Congress, dairy sector eyeing trade issues in Mexico, Japan

May 18, 2018

WASHINGTON — As renegotiation talks on the North American Free Trade Agreement (NAFTA) have yet to reach a conclusion, lawmakers and dairy stakeholders are keeping a close eye on trade developments in Mexico and other key regions.

The European Union (EU) and Mexico last month reached an agreement in principle to update their 18-year-old bilateral trade agreement and announced plans to allow only the EU to use several common cheese names, which could include terms like parmesan and feta.

Dairy industry stakeholders repeatedly have urged the administration to fight EU attempts to use geographical indications (GIs) protections to limit fair competition of U.S. cheeses in Mexico, which is the largest export market for U.S. dairy.

This week, members of the Coalition for Common Food Names (CCFN) called on U.S. Trade Representative Robert Lighthizer to address GIs in the modernized NAFTA.

“We implore your office to immediately engage with Mexico during NAFTA modernization talks to address Europe’s plan to undercut U.S. producers and deny them the markets America has spent years cultivating,” CCFN says.

The coalition notes the EU and Mexico have made clear that cheese names are among 340 GIs included in the agreement in principle, although a list of names has not been released.

“We fear that the EU-Mexico deal will reverse existing market access for some U.S. food producers, while denying others the right to market their products in the future using generic names that have been used around the world for decades,” CCFN says. “For example, U.S. parmesan, muenster and asiago cheeses, among others, will face new hurdles to entering the Mexican market, which is America’s biggest and most important dairy export destination.”

The coalition calls for the U.S. government to address the issue before U.S., Mexican and Canadian negotiators reach an agreement in principle to update NAFTA.

“As discussions continue, we urge you to remain steadfast in your commitment to protect existing Mexican markets, including those for the common name products targeted by this new third-party trade agreement, while looking to expand opportunities in Canada where tariffs and non-tariff barriers like the Class 7 milk pricing scheme block U.S. sales,” CCFN says.

In addition to CCFN, a bipartisan group of U.S. senators this week also sent a letter to Lighthizer expressing concerns about Mexico’s recent trade negotiations with the EU.

“As you work to renegotiate NAFTA, we urge you to engage with your Mexican and Canadian counterparts to ensure that future trade policies do not limit export opportunities for American dairy farmers and processors,” the letter says. “In light of Mexico’s proposed agreement with the EU, we are deeply concerned that American cheesemakers will be harmed by a reversal of their current access to the Mexican market and will be denied the opportunity to sell products to Mexican consumers using common cheese product names that have been marketed for decades.”

Lighthizer recently issued a statement on the status of NAFTA negotiations, noting the United States is working with Canada and Mexico to achieve needed breakthroughs on key objectives.

“For many weeks now, the United States, Mexico and Canada have engaged in intensive, continuous discussions to renegotiate NAFTA, building on the seven rounds of rigorous negotiations that have taken place since August 2017,” Lighthizer says. “The negotiations have covered a large numbers of very complex issues, especially those objectives outlined by Congress as part of the bipartisan Trade Promotion Authority such as intellectual property, dairy and agriculture, de minimis levels, energy, labor and more.”

Lighthizer adds the current NAFTA is a “seriously flawed trade deal, and the Trump administration is committed to getting the best possible trade agreements for all Americans.”

In other trade news, stakeholders say the Japanese government has implemented new measures to support its cheese industry and make domestic cheese more abundant and competitive. At the same time, Japan is entering into free trade agreements with the EU and with the 11 countries in the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP). The proposed agreements would lower tariffs on imported cheese and could be enacted as early as next year.

These measures and agreements could threaten the market for U.S. dairy exports to Japan, the fourth-largest market for U.S. dairy products, representing sales of more than $290 million in 2017, stakeholders say.

“Increases in Japan’s domestic production, as well as trade agreements that create room for more imported non-U.S. cheeses, will certainly change the landscape for U.S. products in the Japanese market,” says Beth Hughes, director of international affairs for the International Dairy Foods Association (IDFA). “IDFA has repeatedly stressed to the administration and Congress that trade agreements with markets in the Asia-Pacific region are critically important to the continued growth of the U.S. dairy industry, and are necessary to ensure we maintain market access when these countries enter new pacts.”

The Japanese government has allocated the equivalent of $141 million to increase its production of natural cheeses. The funds will be used to support new programs designed to expand output on Japanese dairy farms and in cheese manufacturing facilities. They also will support cheesemaking and marketing training courses and measures to increase Japanese cheese consumption, such as activities that incorporate cheese into Japanese food culture.

IDFA says it will continue to work with federal officials and members of Congress to advocate for expanded opportunities for dairy in new trade agreements and more market access for dairy products abroad.

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Moonside Creamery, Point Reyes win at CA State Fair

May 18, 2018

SACRAMENTO, Calif. — Point Reyes Farmstead Cheese Co. of Point Reyes Station, California, and Moonside Creamery of Sebastopol, California, won top honors at the 2018 California State Fair Commercial Cheese Competition held last week at Cal Expo.

Best of Show Cow’s Milk Cheese was awarded to Point Reyes Aged Gouda, a classic Dutch-style Gouda aged 24 months. This is the third straight year Point Reyes Farmstead Cheese Co. has won Best of Show.

Best of Show Other Milk Type went to Moonside Creamery’s Smoke Ring, a mixed-milk, mold-ripened cheese coated with ash and a touch of smoked sea salt. Moonside Creamery started in 2016 and is a newcomer to the competition.

The California State Fair will recognize Point Reyes Farmstead Cheese Co. and Moonside Creamery at a special press event on the steps of the California State Capitol June 21. Later that evening, the winning producers will be invited to sample their cheeses at the Best of California Tasting Reception at Cal Expo held prior to the California State Fair Gala, benefiting The Friends of the California State Fair.

The Commercial Cheese Competition winners also will be presented during the California State Fair Taste of California Experience Classes July 13-29, where experts will teach fair guests how to taste, pair and use the best California cheeses.
A panel of 11 judges from cheese merchants, writers, promoters and educators tasted and evaluated the appearance, aroma, texture and taste of 142 California cheeses entered in this competition.

In addition to Point Reyes Aged Gouda, other winners of the Best of California Cow’s Milk Cheese award include: Crème Fraîche and Whole Milk Ricotta from Bellwether Farms, Grazin’ Girl Gorgonzola from Valley Ford Cheese & Creamery, Wagon Wheel from Cowgirl Creamery and Bishops Peak from Central Coast Creamery.

In addition to Moonside Creamery’s Smoke Ring, other winners of the Best of California Other Milk Type award include: Goat Milk Vanilla Kefir from Redwood Hill Farm, Aurora from Moonside Creamery, Dream Weaver and Goat Cheddar from Central Coast Creamery and Boont Corners Reserve from Pennyroyal Farm.

Cheesemakers with award-winning cheeses at this year’s competition include:

Bellwether Farms, Petaluma California, won gold medals for Crème Fraîche, Whole Milk Ricotta and Blackstone; silver medals for Fromage Blanc and Pepato; and a bronze medal for Carmody.

Bleating Heart Cheese, Tomales, California, won a gold medal for Death & Taxes, and silver medals for Le Moo, Goldette Tommette and Fat Bottom Girl.

Central Coast Creamery, Paso Robles, California, won gold medals for Dream Weaver, Goat Cheddar, Goat Gouda and Bishop’s Peak; a silver medal for Ewereka; and a bronze medal for Seascape.

Cowgirl Creamery, Point Reyes Station, California, won gold medals for Inverness and Wagon Wheel, and silver medals for Cottage Cheese, Fromage Blanc, Red Hawk and Mt Tam.

Cypress Grove, Arcata, California, won gold medals for Fromage Blanc, Purple Haze, Herbs de Humboldt, PsycheDillic and Bermuda Triangle, and silver medals for Ms. Natural, Sgt. Pepper, Truffle Tremor, Truffle Tremor Mini, Humboldt Fog Grande and Humboldt Fog Mini.

El Mexicano, San Jose, California, won gold medals for Requeson, Mozzarella and Menonita; a silver medal for Fresco Casero; and bronze medals for Oaxaca and Enchilado Aged Cotija.

Fagundes Old World Cheese, Hanford, California, won silver medals for Portuguese Queijo Fresco and St. John, and a bronze medal for Hanford Jack.

Fiscalini Cheese, Modesto, California, won gold medals for San Joaquin Gold and Lionza; silver medals for Smoked Scamorza, Bandage Wrap Cheddar (2), Purple Moon, California Craft Beer Cheddar and Onion and Chive; and a bronze medal for Habanero.

Green Valley Organics, Sebastopol, California, won a bronze medal for Lactose Free Whole Milk Kefir.

Joseph Farms, Atwater, California, won silver medals for Mild Cheddar, Sharp Cheddar, Pepper Jack and Marbled Jack, and bronze medals for Mozzarella (2), Provolone, Monterey Jack and Medium Cheddar.

Laura Chenel’s, Sonoma, California, won gold medals for Original Medallion, Original Chabis, 4 Peppercorn Chabis, Herb Cabecou, Spicy Cabecou and Goat Brie; silver medals for Original Log, Crushed Olive Log, Black Truffle Log and Truffle Cabecou; and bronze medals for Sun-dried Tomato & Basil Medallion and Fig & Grapefruit Medallion.

Marin French Cheese, Petaluma, California, won gold medals for Petite Breakfast, Petite Camembert, Camembert, Petite Jalapeño, Petite Cendrée and Schloss; silver medals for Traditional Brie, Petite Crème, Petite Truffle and Supreme Brie; and bronze medals for Triple Crème Brie and Petite Supreme.

Moonside Creamery, Sebastopol, California, won gold medals for Aurora and Smoke Ring and a bronze medal for Lunetta.

Nicasio Valley Cheese Co., Nicasio, California, won gold medals for Locarno Wheel and San Geronimo; silver medals for Foggy Morning, Foggy Morning with Basil & Garlic, Loma Alta, Nicasio Square and Nicasio Reserve; and bronze medals for Locarno, Formagella and Tomino.

Orland Farmstead Creamery, Orland, California, won a silver medal for Fromage Blanc and bronze medals for Fromage Blanc and Ricottage with Garlic and Dill.

Pennyroyal Farm, Boonville, California, won gold medals for Boont Corners Reserve and Bollie’s Mollies; a silver medal for Laychee; and bronze medals for Velvet Sister and Boont Corners 2-month.

Point Reyes Farmstead Cheese Co. won a gold medal for Point Reyes Aged Gouda and silver medals for Point Reyes Bay Blue and Point Reyes Toma.

Redwood Hill Farm, Sebastopol, California, won a gold medal for Goat Milk Vanilla Kefir and a bronze medal for Aged Goat Milk Cheddar.

Rumiano Cheese, Crecent City, California, won silver medals for Smoked Mozzarella, Smoked White Cheddar rBST Free, Habanero Jack rBST Free, Organic Smoked Mozzarella, Willow Maid Pepper Coated Dry Jack and Willow Maid Peppercorn Dry Jack rBST Free; and bronze medals for Organic Medium Cheddar, Organic Chipotle White Cheddar and Willow Maid Uncoated Dry Jack rbST Free.

Sierra Cheese, Compton, California, won a silver medal for String Cheese and a bronze medal for Part Skim Ricotta.

Sierra Nevada Cheese, Willows, California, won a gold medal for Organic Monterey Jack and silver medals for Crème Fraîche, Organic Cream Cheese and Graziers Raw Medium Cheddar.

Stuyt Dairy Farmstead Cheese, Escalon, California, won a silver medal for Mild 2-4 month Gouda and bronze medals for Cumin Gouda, Smoked Gouda, Bacon Gouda and Aged Gouda.

Valley Ford Cheese & Creamery, Valley Ford, California, won gold medals for Grazin’ Girl Gorgonzola, Estero Gold and Estero Gold Reserve.

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Savencia and Rogue Creamery join forces

May 18, 2018

NEW HOLLAND, Pa. — Savencia Fromage & Dairy, a global specialty cheese manufacturer, has announced that Rogue Creamery will become a part of Savencia Fromage & Dairy effective today.

Rogue Creamery, an artisan cheesemaker specializing in Blue cheese, was established in Central Point, Oregon, in 1933.

Rogue Creamery will continue to operate as a separate public benefit corporation, and David Gremmels will remain as president of the creamery.

“We are excited to join the Savencia family, which offers great opportunities to further fuel our growth,” Gremmels says. “Our commitment to organic cheese of uncompromising quality will remain unchanged. Savencia shares our appreciation for a strong family-based culture, and they are experts in our craft. This partnership will allow us to increase our impact on the community, one wheel of cheese at a time.”

Savencia Fromage & Dairy has more than 19,000 employees in 29 countries. It is an independent family group listed with Euronext, Paris.

“Rogue will strengthen our leadership in specialty cheeses and perfectly complement our high-end portfolio of award-winning cheese like Dorothy’s, St. André, Etorki, and the world champion Esquirrou,” says Dominique Huth, CEO, Savencia Cheese USA.

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Klondike to launch Buholzer Brothers brand of Brick, Muenster and Havarti

By Kate Sander

MONROE, Wis. — A new retail brand featuring a familiar industry name will be arriving at grocers in the Midwest and beyond this summer.

Buholzer Brothers is a new brand of Brick, Muenster and Havarti being rolled out by Klondike Cheese Co., a cheese and Greek yogurt manufacturer based in Monroe, Wisconsin, and owned by the Buholzer family.

For almost a century, the Buholzers have been making cheese in southern Wisconsin’s Green County, and since 1972, the family has been making cheese at the Klondike Cheese facility they purchased. The company is operated by third generation cheesemakers — Ron, Dave and Steve Buholzer, aka the Buholzer Brothers — as well as some of their children.

Klondike is perhaps best known for its Feta, sold under the Odyssey brand. However, the company has long produced Brick, Havarti and Muenster for distributors and converters. This will be the company’s first foray into branding these cheeses, says Luke Buholzer, Ron’s son and a fourth generation of the family to work in the business alongside Steve’s son, Adam, and his wife Teena, and Steve’s daughter Melissa Erdley and her husband Matt.

Buholzer Brothers cheeses will be available in 8-ounce retail cuts and deli slicing loaves.

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NAFTA outlook uncertain as proposed May deadline looms

May 11, 2018

WASHINGTON — U.S. Trade Representative (USTR) Robert Lighthizer this week met with Mexican Economy Minister Ildefonso Guajardo and Canadian Foreign Minister Chrystia Freeland in Washington, D.C., to continue NAFTA renegotiation talks.

While the Trump administration had floated a May 18 deadline for securing congressional approval of a new deal, stakeholders say key sticking points such as auto rules of origin and dispute settlement are increasingly casting doubt on talks being wrapped up next week. Meanwhile, U.S. dairy stakeholders continue to urge USTR and the White House to address Canada’s Class 7 milk pricing policies in the modernized agreement.

Missing next week’s deadline could have significant consequences, given the political calendars in both the United States and Mexico, stakeholders say. The president’s authority to negotiate trade deals that Congress must approve or reject without amendment expires July 1, also the date of Mexico’s presidential election. U.S. officials say that May 18 represents the deadline for securing congressional approval under Trump’s existing authority this year, given the various timelines specified in the legislation.

To facilitate U.S. trade negotiations, Congress passed the Bipartisan Congressional Trade Priorities and Accountability Act of 2015, otherwise known as Trade Promotion Authority (TPA), which gives Congress oversight authority during trade negotiations, but only allows for an up-or-down vote on the final agreement with no amendments. The 2015 TPA applies to trade agreements reached prior to July 1, 2018. TPA can be extended through July 1, 2021, if the president asks for an extension and Congress does not enact an extension disapproval resolution within 60 days of July 1, 2018.

To invoke TPA, the presidential administration must follow several mandatory steps prior to, during and upon completion of a trade negotiation. These include a detailed summary of objectives to be achieved in the final agreement and research into the extent that the agreement would promote or impact the economic interests of the United States.

This week, addressing reports that the Trump administration may try to strong-arm Congress into approving an incomplete agreement that relies on “principles” and is thin on details, U.S. Reps. Sandy Levin, D-Mich., and Ron Kind, D-Wis., in a letter to President Trump cautioned that doing so is a distraction from addressing core concerns, neglects the interests of American workers and jeopardizes congressional support.

“A new NAFTA should pass Congress based on its merits and not on the threat of withdrawing from the existing agreement,” say Levin and Kind.

Stakeholders also say the lack of progress on a new NAFTA comes as the Trump administration is increasingly preoccupied with a growing trade dispute with China.

Tensions with China remain high after the United States threatened to impose tariffs on $50 billion worth of Chinese goods via its Section 301 investigation. (See “Tariff dispute between China, U.S. escalates; report released” in the April 6, 2018, issue of Cheese Market News.)

Several administration officials last week traveled to China to meet with Chinese officials and discuss the U.S. Section 301 investigation into Chinese practices and policies on intellectual property, as well as China’s trade surplus with the United States. The U.S. officials included Lighthizer, Treasury Secretary Steven Mnuchin, Commerce Secretary Wilbur Ross, Terry Branstad, ambassador of the United States to China, Everett Eissenstat, deputy assistant to the president for International Economic Affairs, Larry Kudlow, director of the National Economic Council and Peter Navarro, director of the White House National Trade Council.

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Sources indicate likelihood of transitioning to CA FMMO

May 11, 2018

WASHINGTON — While the formal election period for California producers to vote on becoming part of the federal milk marketing order (FMMO) recently closed, USDA is not expected to officially announce results until later this month. However, the three largest milk marketing cooperatives in California — California Dairies Inc. (CDI), Dairy Farmers of America (DFA) and Land O’Lakes Inc. — this week announced that, on behalf of their respective members, they have voted in support of the California FMMO as proposed by USDA.

Since the beginning of the process, the three co-ops collaborated to create a potential California FMMO as a means of helping the state’s dairy farmers receive more equitable, market-based milk prices, the co-ops say.

“Three years ago, farmer leaders of our cooperatives agreed to work toward a change in the regulatory structure, one that would benefit California dairy farm families,” say the three co-ops in a joint statement released this week. “Following careful consideration of the final decision issued by USDA, we believe the proposal will better address disparities between farmgate prices in California and the rest of the nation. It is our pleasure to now conclude this administrative process with joint support for the proposed federal order language.”

USDA in March published its final decision to establish an FMMO for the state of California. The final decision was based on the evidentiary record of a public hearing held in Clovis, California, from September to November 2015. A recommended decision regarding the proposed program was published Feb. 14, 2017.

USDA last month also held a public meeting beginning to answer questions related to how the proposed California FMMO would operate and how eligible dairy producers can participate in the referendum. (See “USDA announces final decision on California FMMO” in the March 30, 2018, issue of Cheese Market News.)

The three major cooperatives also held educational sessions for their member-owners to provide an overview of the final decision, address specific questions and discuss voting preferences. Each of the cooperatives then participated in bloc voting, meaning a single affirmative vote from each cooperative represents the voting cooperative’s total membership in the state.

Geoff Vanden Heuvel, board member and economic consultant for the California Milk Producers Council, says that since the three cooperatives are voting on behalf of all of their members, and since collectively they represent more than 75 percent of the producers in California, it is safe to say that California will become the 11th federal marketing order in the United States.

USDA will officially announce the results of the referendum in the coming weeks. If the results support approval of USDA’s proposal to establish a California FMMO, the new system is expected to be in place by Nov. 1, 2018.

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Report projects more milk, slightly higher prices in ’19

May 11, 2018

WASHINGTON — U.S. milk production in 2018 is forecast to reach 218.7 billion pounds, USDA says in its latest “World Agricultural Supply and Demand Estimates” report released Thursday, down 300 million pounds from the forecast in last month’s report but still more than 3 billion higher than the 215.5 billion pounds of milk produced in the United States in 2017.

In the report’s first forecast for 2019, USDA projects milk production next year will reach 221.5 billion pounds upon improved production in milk per cow and cow numbers remaining near 2018 levels.

USDA raised its 2018 export forecast from last month on both a fat and skim-solids basis due to strong global demand. In 2018, USDA currently forecasts commercial exports on a fat basis at 9.9 billion pounds and commercial exports on a skim-solids basis at 45.1 billion pounds. Robust global demand has USDA projecting 2019 exports to climb to 10.2 billion pounds on a fat basis and 45.3 billion pounds on a skim-solids basis.

The 2018 dairy import forecasts are lowered to 5.5 billion pounds on a fat basis and 5.8 billion pounds in a skim-solids basis. Those also are the forecast levels for 2019.

In this month’s report, 2018 cheese, butter, nonfat dry milk (NDM) and whey price forecasts are raised from the previous month resulting in both Class III and Class IV prices being raised.

Cheese is forecast to average in the $1.600-$1.650 per pound range this year, up 5 cents from USDA’s forecast last month. The butter forecast is increased to $2.245-$2.325 from $2.210-$2.290 in last month’s report. The NDM forecast is up 4 cents to $0.740-$0.780, and the dry whey forecast is up 1.5 cents to $0.255-$0.285.

The 2018 Class III price is forecast to average in the $14.80-$15.30 per hundredweight range, up 60 cents from last month’s forecast. The Class IV price forecast is up 50 cents to $13.75-$14.35. The 2018 all-milk price is increased to $16.20-$16.70, up 60 cents from last month’s report.

With stronger expected domestic and export demand, cheese, NDM and whey prices are forecast to average higher in 2019 than in 2018. The butter price forecast range is slightly lower. The 2019 Class III price is forecast to average in the $14.80-$15.80 range. The 2019 Class IV price forecast also is higher than the current 2018 forecast as a stronger expected NDM price more than offsets the lower butter price. The Class IV price in 2019 currently is projected to average in the $13.65-$14.75 range.

The 2019 all-milk price is forecast at $16.25 to $17.25, slightly higher than 2018.

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Menu labeling regulations take effect across U.S.

May 11, 2018

WASHINGTON — Federal regulations went into effect Monday, May 7, that require restaurants with 20 or more locations to post calories on their menus. Nutrition information now will be available at more than 200,000 restaurant locations nationwide.

FDA says the regulation covers chains with 20 or more locations doing business under the same name that offer substantially the same menu items consisting of restaurant-type foods. Consumers also can ask establishments for additional nutritional information — for example, a booklet, handout or electronic form — that includes the amount of sodium, fiber, sugars, total carbohydrates, saturated fat and protein for any standard menu item.

“This is information Americans want or need in order to make decisions about the foods they eat so they can make more informed choices about their diets and health for themselves and their families,” says Scott Gottlieb, FDA commissioner.
Gottlieb says FDA is committed to helping industry in fulfilling this requirement in a way that is both effective and not overly burdensome. In order for these opportunities to be maximally beneficial to consumers, the new provisions also need to be minimally burdensome for businesses to effectively comply, he says.

To that end, FDA has taken new steps to reduce the costs that the new provisions will impose on businesses. FDA on Monday finalized an existing guidance document that provides additional clarity and details requested by the food industry on FDA’s thinking about various topics related to the new regulation.

Gottlieb says while the overall framework in the guidance — which was announced in Tuesday’s Federal Register — remains largely unchanged, FDA has made some meaningful updates to address thoughtful and important input from the public and industry stakeholders. These include more flexibility for businesses in how they can address challenges that some establishments faced in meeting the law’s requirements.

The changes in the final guidance include expanded and new examples of the ways to comply with the menu labeling requirements. Overall, the guidance clarifies that posters, billboards, coupon mailings and other marketing materials are generally not considered menus that would require calorie counts under FDA’s regulation. It also provides other practical and flexible options for implementing the regulation, such as graphical depictions to illustrate ways to post calories for multiple items on a single sign, such as those that might be features at a self-service buffet or beverage stations.

In response to concerns from pizza chain owners who shared with FDA that they believed it would be difficult to develop menu boards reflecting the thousands of topping combinations people might want on their pizza, FDA provided several graphic illustrations to provide options for how to accomplish this. The agency’s goal is to implement these congressional provisions in the most efficient, effective manner that both benefits consumers without placing unnecessary barriers on industry, Gottlieb says.

To advance these goals, FDA also is taking a flexible approach to implementing the new provisions, he notes. For the first year, FDA will center its efforts on helping covered establishments come into compliance with the law, he adds.

The National Restaurant Association welcomed implementation of the menu labeling standards, noting thousands of restaurants already were complying with the requirements in anticipation of the deadline and because consumers have been asking for more transparency on the nutritional content of the food they order.

“By setting a clear standard, this rule provides the necessary guidance and expectations for America’s restaurants to follow in order to continue delivering a high-quality experience and customer service to everyone who walks through our doors, as well as the transparency our customers demand,” says Cicely Simpson, executive vice president, National Restaurant Association.

To view the guidance, visit www.fda.gov/Food/GuidanceRegulation/GuidanceDocumentsRegulatoryInformation/ucm583487.htm. For more information, contact FDA’s Loretta A. Carey at 240-402-2371.

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CME cheese hits 2018 highs; analysts share market outlook

May 4, 2018

By Alyssa Mitchell

MADISON, Wis. — Cheddar barrels and blocks at the Chicago Mercantile Exchange (CME) reached new 2018 highs this week as dairy stakeholders gathered in Chicago for the annual meeting of the American Dairy Products Institute (ADPI)/American Butter Institute (ABI).

USDA’s Dairy Market News says contacts were reporting an unstable market due to the gap between cheese blocks and barrels. However, the 11.5-cent barrel climb Tuesday to settle at $1.6025 per pound narrowed the price gap into the single-digit
range. Cheddar blocks, which closed last week at $1.6200 per pound, also have increased this week and settled at $1.6650 on Wednesday. Barrels bumped down to $1.6000 today, while blocks remained unchanged.

The cheese market tone still remains uncertain, despite the CME barrel price increase, as some contacts express concerns whether the uptick will stay after the run-up, Dairy Market News says. Sales activity is reported as fair to slightly up. Cheese demand reports are generally unchanged.

Phil Plourd, president of Blimling and Associates Inc., Madison, Wisconsin, says both domestic and global dairy demand looks good, which is lending support to CME cheese.

Plourd participated in a dairy market outlook session at the ADPI/ABI conference this week. In his presentation, he noted five key forces that are impacting dairy markets: the global/big picture outlook, demand, farmer/producer financing/supply, inventories and transportation.

From a macro standpoint, the price of crude oil is up, and the U.S. dollar was on a weakening trend before recent increases, Plourd says.

Meanwhile, cheese and butter demand has been steady, stronger than a year ago, he says. Retail sales were positive for the first quarter of 2018.

While CME markets have moved between high highs and low lows, there has been a general upward trend in pricing, he adds, noting it’s not a good time for buyers to be caught short on product.

At the same time, sales of fluid milk and yogurt have slowed, Plourd says, and dairy farmers are feeling the pressure of lower milk prices.

Exacerbating this issue are rising transportation costs as regulations are tightening and the market is short on drivers, he notes.

• Weather outlook

Jon Davis, chief meteorologist with Riskpulse, based in Austin, Texas, provided an overview of global weather patterns at the conference market session.

Davis notes a colder-than-average April has set the stage for a later crop season as the planting season was delayed. He says while this may not necessarily negatively impact the market, it adds increased risk. Corn is the most vulnerable, he adds.

There also is a summer heat risk for dairy cattle, particularly in the Southwest quadrant of the United States due to long-term dryness in California, New Mexico and Texas, Davis says.

Heat risk probabilities are lower in the Northern zones — Upper Midwest, Great Lakes and the Northeast — especially for the first half of the summer, he adds.

Globally, the drought in Argentina has come to an end, but Mexico has a similar dryness as the Southwest United States, Davis says. Meanwhile, a wet pattern in New Zealand is expected to ease, and analysts are keeping a close eye on Europe and the Black Sea region as hot temperatures are expected.

• A global view

Also in the market session, Mary Keough Ledman and Kevin Bellamy — global dairy strategist and global head of dairy, respectively, at Rabobank — provided an overview of what’s on the horizon in the global dairy market.

Rabobank anticipates dairy commodity prices to remain on an upward trend in 2018.

Ledman says a slowdown in the rate of growth in global milk production is the basis for an improved outlook for farmgate milk prices around much of the world.

She adds that most dairy products, aside from butter, are trading below 5-year averages. In addition, rising oil prices have increased the purchasing power of government-procured dairy products.

From an export standpoint, Ledman says the 2018 tug-of-war in the game of global dairy trade will very much be the United States versus the European Union.

“As a result, currency relationships and logistics will play key roles in determining how much market share is gained by either region,” she says.

CMN


U.S. cheese production rises 2.7 percent over year earlier

May 4, 2018

WASHINGTON — Total U.S. cheese production, excluding cottage cheese, was 1.10 billion pounds in March, up 2.7 percent from March 2017’s 1.07 billion pounds, according to data released Thursday by USDA’s National Agricultural Statistics Service (NASS). (All figures are rounded. Please see CMN’s Dairy Production chart.)

March cheese production also was 11.6 percent above February 2018’s 986.9 million pounds. March production was 0.8 percent higher than February production on an average daily basis when adjusted for the length of the months.

Production of Mozzarella, the nation’s most-produced cheese, totaled 371.5 million pounds in March, up 2.8 percent from March 2017’s 361.4 million pounds, according to NASS. Total Italian-type production, of which Mozzarella is the largest component, was 481.6 million pounds in March, up 2.5 percent from a year earlier. In the Italian category, production of Romano saw a significant jump from the year earlier to 5.4 million pounds, an increase of 25.6 percent.

Production of American-type cheeses rose 1.7 percent from March 2017’s 429.6 million pounds to 437.0 million pounds, NASS reports. However, production of Cheddar, the largest component of American-type production, was down 2.7 percent from a year earlier to 314.8 million pounds.

Wisconsin led the nation’s cheese production with 290.2 million pounds in March, up 1.6 percent from its production in March 2017. California followed with 215.7 million pounds, down 0.4 percent from its production a year earlier.

Total U.S. butter production in March was 185.6 million pounds, NASS reports, up 4.8 percent from March 2017’s 177.0 million pounds. March butter production was 9.1 percent higher than February 2018’s 170.1 million pounds, but when adjusted for the length of the months, March butter production was down 1.5 percent from February on an average daily basis.

California led the nation’s butter production with 59.0 million pounds in March, up 16.4 percent from its production a year earlier.
Last week NASS also released its “Dairy Products 2017 Summary.”

According to NASS, total cheese production, excluding cottage cheeses, was 12.66 billion pounds, 3.9 percent above 2016’s 12.18 billion pounds (2016 was a leap year). Wisconsin was the leading state with 26.6 percent of the production, NASS says.

Production of Italian varieties in 2017, at 5.38 billion pounds, was 1.5 percent above 2016 production and accounted for 42.5 percent of total cheese in 2017, NASS continues. Mozzarella accounted for 77.3 percent of the Italian production followed by Parmesan with 8.4 percent and Provolone with 7.4 percent. Wisconsin was the leading state in Italian cheese production with 31.6 percent of the production.

American-type cheese production in 2017 was 5.07 billion pounds, 6.4 percent above 2016 and accounted for 40.1 percent of total cheese in 2017. Wisconsin was the leading state in American-type cheese production with 20.0 percent of the production, NASS says.

Butter production in the United States during 2017 totaled 1.85 billion pounds, 0.4 percent above 2016’s 1.84 billion pounds, NASS says. California was the leading state in butter production with 28.9 percent of the production.

CMN


FDA extends compliance dates for Nutrition Facts

May 4, 2018

WASHINGTON — FDA in today’s Federal Register announced it is extending the compliance dates for the final rules on updated nutrition information on the labels of food, including dietary supplements.

FDA says updated labels now will be required for large companies by Jan. 1, 2020, instead of the original date of July 26, 2018, and for smaller companies by Jan. 1, 2021, instead of the original date of July 26, 2019.

The final rules appeared in the May 27, 2016, Federal Register. FDA is taking this action because, after careful consideration, it has determined that additional time would help ensure that all manufacturers covered by the final rules have guidance from FDA to address, for example, certain technical questions the agency received after publication of the final rules, and that they have sufficient time to complete and print updated Nutrition Facts labels for their products before they are expected to be in compliance with the final rules.

For more information, contact Paula Trumbo with FDA’s Center for Food Safety and Applied Nutrition at 240-402-2579.

Cary Frye, senior vice president of regulatory affairs for the International Dairy Foods Association (IDFA), says IDFA’s members greatly appreciate that FDA has extended the compliance date for the new Nutrition Facts labeling.

“Although IDFA had requested an extension until July 1, 2020, the announcement to align with USDA’s proposed bioengineered food disclosure compliance date will be helpful for processors, allowing them only to make changes to a label once.”

CMN


Arla Foods ends milk contracts with 11 farmers

May 4, 2018

KAUKAUNA, Wis. — Arla Foods this week ended its relationship with 11 farmers in Wisconsin that supplied its Hollandtown cheese plant, as dairies across the United States continue to face challenges.

Arla notified these farmers that it will stop buying their milk in 60 days. Twenty-four farmers will remain as suppliers to the plant in Kaukauna, Wisconsin.

“Increased production and market volatility are affecting the supply chain of the entire dairy industry, and unfortunately, Arla Foods isn’t any different than many in the industry right now,” says Don Stohrer Jr., general manager, Arla Foods Inc. USA. “As a farmer-owned co-op, any decisions involving relationships with farmers are not made lightly. The company prolonged this decision and absorbed the market volatility for as long as possible in the hope that the market might change.”

Later this month, Dean Foods will end milk procurement contracts with more than 100 farmers across eight states due to surplus milk and other factors. (See “Dean Foods will end milk procurement contracts with more than 100 farmers” in the March 16, 2018, issue of Cheese Market News.)

Arla, based in Denmark, is owned by 12,500 farmers across seven countries in Northern Europe. The Hollandtown plant, which produces Havarti, Gouda, Edam, Fontina and Muenster, is Arla’s only U.S. processing facility.

CMN


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Today's Cheese Spot Trading
May 22, 2018


Barrels:$1.5650 (-1/2)
Blocks: $1.6375 (-1/4)


Click here for more market activity
Cheese Production
U.S. Total March
1.101 bil. lbs.


Milk Production
U.S. Total March
18.987 bil. lbs.

Guest Columnist

Farewell and adieu to you, bearish markets

Dave Kurzawski, FCStone

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