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Strong U.S. demand ahead of
holidays boosts CME cheese

October 21, 2016

By Alyssa Mitchell

MADISON, Wis. — Cheddar prices shot higher this week at the Chicago Mercantile Exchange (CME). Analysts say that while strong domestic cheese demand indicated a price bump was on the horizon, the magnitude of the climb was a little surprising.

Cheddar barrels on Tuesday jumped 12 cents to settle at $1.61 per pound, while Cheddar blocks rose 9.5 cents to settle at $1.68 per pound, their highest levels since early September. CME cheese prices have fallen only a few cents to close out this week, settling at $1.57 for barrels and $1.65 for blocks today.

Sara Dorland, managing partner with Ceres Dairy Risk Management LLC, Seattle, notes tremendous volumes of cheese were trading at the CME in September but since have slowed, leading to anticipation of a price increase.

However, the magnitude of the increase was a little surprising, she says, noting CME futures did not move significantly higher this week.

“We have a bit of reconciliation to do,” she says. “It’s almost as if the futures market is saying, ‘prove to me that cheese is that tight.’”

“We were lower, but now we’re above world prices,” she adds. “So I would expect us to track back to align globally. I think a number near $1.50 makes the most sense right now.”

USDA’s Dairy Market News says some cheesemakers say they are getting more inquiries from export channels.

“Although sales have not developed as of yet, cheesemakers are hopeful it is a sign that those market opportunities will be able to grow in the near future,” Dairy Market News says.

While record stocks have been reported for much of the year, Dairy Market News notes manufacturers report cheese inventories for both barrels and blocks are more comfortable.

Domestically, cheese orders are steadily increasing for holiday retail sales, Dairy Market News adds, noting some industry contacts suggest that cheese was somewhat undervalued prior to the recent jump of block and barrel cheese prices at the CME.

While cheese stocks are sufficient for most near-term commitments, market participants have indicated that some Mozzarella inventories are sold out — the upcoming Halloween holiday is one of the top five pizza sale days, Dairy Market News notes.

“Hence, cheese orders from wholesalers moving into foodservice are active,” Dairy Market News says.

Mike McCully, owner of The McCully Group LLC, Chicago, notes the U.S. dairy industry is starting to see the return of export demand, not only for 2017 orders but also for the fourth quarter of 2016.

“For a year-and-a-half or so, market outlooks have mostly been bearish, but there are some bullish indicators as we align with global prices and exports pick up,” McCully says.

Still, he notes U.S. fundamentals including stock levels and increasing milk production still overhang the market.

While McCully anticipates cheese prices through the fourth quarter to track in the $1.60s to $1.70s, give or take a dime, CME butter may trend lower.

CME butter prices have held strong for most of 2016 but recently have begun to recede from the $2 level, settling at $1.76 per pound today.

“I think most people who follow this market are expecting some upward movement soon as holiday orders begin to ramp up,” McCully says. “But if it doesn’t move up between now and early November, that’s pretty much it,” he says, adding that he has lowered his forecast for butter prices from $1.80 per pound down to $1.50-$1.75 into 2017.

James Dunn, professor of agricultural economics at Penn State University, agrees.

“I think much of the holiday demand we see at the CME is largely accounted for by Thanksgiving, so butter could go up in the short term, but I expect it will decline again by year’s end, maybe into the high $1.60s,” Dunn says.

Dorland notes that from a retail perspective, the lower butter prices allow retailers to start promoting products they have not been able to promote at higher prices.

Stocks continue to overhang the butter market, she adds.

Dairy Market News echoes that butter stocks are heavy in most processing facilities.

“In order to lower inventory levels, some processors are selling bulk butter at competitive prices in the spot market. The current spot prices are enhancing the interest of several buyers,” Dairy Market News says. “Print butter demand from retailers is strong but steady from foodservice.”

“Export demand, prompted by competitive prices, is good,” Dairy Market News adds.



Ricotta applications, trends
expand beyond Italian dishes

October 21, 2016

Editor’s Note: “Cheese of the Month” is Cheese Market News’ exclusive profile series exploring various cheese types. Each month, CMN highlights a different cheese in this feature, giving our readers a comprehensive look at production, marketing, sales and in-depth aspects of each profiled cheese type. Please read on to learn about this month’s featured cheese: Ricotta.

By Stephanie Awe

MADISON, Wis. — Ricotta, with its milky, fresh flavor and a hint of sweetness, is a cheese with applications spreading beyond Italian dishes.

Ricotta was originally produced by Italian cheesemakers from the whey that remained after making Mozzarella and Provolone. The cheesemakers added lactic acid or vinegar to the whey and reheated it almost to boiling, a process that caused the curds to precipitate and rise to the surface, where they were skimmed off and drained, according to the Wisconsin Milk Marketing Board.

Traditionally, about 5 to 10 percent milk may have typically been incorporated with the whey, according to John Jaeggi, cheese industry and applications coordinator, the Wisconsin Center for Dairy Research. In the United States today, however, it is becoming more mainstream for companies to use a higher whey to milk protein ratio, as doing so is believed to be more economical, he says.

Additionally, the process of Ricotta manufacture often includes the ultrafiltration of milk and whey to remove excess water before heating. The resulting curd also is homogenized to help incorporate stabilizers, which help hold more moisture and prevent water from running off the cheese, Jaeggi says.

As a result of higher amounts of whey protein, along with homogenization, the Ricotta develops a more cooked flavor, is sweeter and has a very fine mealy curd structure, almost like a “curdy Mascarpone,” Jaeggi says.

In addition, manufacturers are more commonly using dried sweet whey, whey protein concentrate and nonfat dry milk powders to produce Ricotta, which also result in a sweeter flavor due to the lactose found in the products, Jaeggi says.

While recipes vary from company to company, more milk in the cheese creates more curd definition. Whole milk, compared to reduced-fat or skim milk, creates the fluffiest Ricotta due to its higher fat content, Jaeggi says.

• Ricotta varieties

Ricotta comes in several varieties and forms. In addition to Ricotta made from cow’s milk, there is sheep’s milk Ricotta, which is high in salt and often used atop pastas. Among other forms is Ricotta Salata, a dried Ricotta used for grating and topping on foods that can be made from the whey of both sheep’s milk and cow’s milk, according to Jaeggi.

Impastata Ricotta, another form that is known for higher fat levels and full flavor, is offered by Saputo Cheese, Lincolnshire, Illinois, according to Sandy Goldberg, vice president of business development, Saputo Cheese USA Inc.

Meanwhile, hand-dipped Ricotta traditionally requires the cheesemaker to dip the curd into cloth and then drain the cheese before placing it into a container for sale, Jaeggi says. Ricottas made by using more milk and/or utilizing hand-dipped methods are often found in specialty cheese shops and in restaurants.

At Maplebrook Farm, Bennington, Vermont, the company’s Ricotta Alta and Hand-Dipped Ricotta are hand-dipped and drained and are made only from whole milk from cows, vinegar and salt, according to John Peck, operations manager, Maplebrook.

For hand dipping, Maplebrook uses 140-gallon kettles that were built in 1946. The company does not use automated equipment in an effort to stick with traditional methods and maintain authenticity, according to Mike Scheps, co-owner, Maplebrook.

• Production and retail sales

About 243 million pounds of Ricotta were produced in the United States in 2015, a 0.8-percent decrease from 2014, according to the USDA’s Dairy Products 2015 Summary published in April 2016.

Volume sales of Ricotta have declined or plateaued annually since 2011 (fixed weight only, U.S. multi-outlet and convenience stores). However, 2016 retail sales have rebounded, with the variety growing at almost 6 percent as of Sept. 4 this year, according to Information Resources Inc. (IRI) data courtesy of Dairy Management Inc.

As of Sept. 4, Ricotta’s average price has dropped compared to 2015, hitting a two-year low point in April before increasing again in May, according to the data. In addition, Ricotta’s distribution spiked slightly during the 2015 holiday season.

About 24.4 percent of U.S. households are purchasing Ricotta, a number that has slightly increased over the past year due to more trial and repeat consumers (latest 52 weeks ending Sept. 4, 2016), the IRI data says.

Maplebrook has noticed retail growth in its Ricotta cheeses in about the past year, Peck says, noting that its health benefits, such as its high protein content, may have contributed to its recent heightened sales.

Biazzo Dairy Products Inc., Ridgefield, New Jersey, also sees strong retail demand for the company’s Ricotta.

“What’s really helped with retail are the cooking shows you see on TV, and now added to that social media,” says John Iapichino Jr., executive vice president, Biazzo, noting that he has seen recipes incorporating Ricotta through his Facebook news feed.

In addition to television and social media, the decrease of milk prices has helped Ricotta’s retail popularity increase, Iapichino says. The product is more affordable now than before, meaning consumers are more likely to purchase two packs of Ricotta instead of one.

• Applications and trends

Ricotta, while traditionally used in various Italian dishes, such as lasagna, manicotti and ravioli, is a cheese with many applications.

“People are waking up to the fact that it is so versatile,” says Johann Englert, co-owner, Maplebrook.
For example, consumers are using the cheese at breakfast, spreading it on toast sprinkled with sugar and cinnamon or adding it to scrambled eggs, she says.

Englert adds that she, personally, enjoys using it when making gnocchi.

“It’s delicious,” she says.

Maplebrook also distributes its Ricotta to restaurants along the East Coast, where chefs are seeking new ways to utilize the cheese in their recipes.

Currently, it is popular for chefs to incorporate the cheese into appetizers, such as one that pairs the cheese with oil, vinegar and fresh salt on crackers, Englert says.

With its clean taste, the cheese also can be used as a pizza topping or in dips and spreads for entertaining and snacking occasions, Goldberg says, adding that the cheese can be incorporated as a filling in desserts as well.

Iapichino says he sees Ricotta traditionally used in Italian cheesecake, although he increasingly has seen consumers starting to pair the cheese with fruit. Especially with the trend of combining fruit and Greek yogurt, he says he has noticed Ricotta become another popular protein option that can replace yogurt.

Along with fruit, he notes that he has noticed consumers incorporate Ricotta in cookies or pancake batter. On social media, he has noticed recipes that add Ricotta to meatballs and various types of cakes.

Along with sales segments in retail, foodservice and co-packing, Biazzo sells its Ricotta to food manufacturers who use the cheese as an ingredient in their products, which include pastas and desserts.

• Innovations and marketing tactics

With high interest in the product, cheese companies continue to innovate and develop new varieties and uses.

Maplebrook, for example, is in research and development stages for creating a whey-based Ricotta in order to offer a more traditional, lower fat Ricotta variety, Peck says.

The whey-based Ricotta is expected to be available in 10-pound and 30-pound formats in 2017.

In addition, the company will be moving into a new facility in November, allowing more space for production while utilizing its older facility for aging rooms or additional space to make small batch specialty products. The new facility also may add a retail shop for Maplebrook’s and other Vermont cheeses, Peck says.

Biazzo, which currently offers whey-based Ricottas with whole, part-skim or fat-free milk as well as a whole milk Ricotta with no salt added, has introduced a new Ricotta product that contains only milk, vinegar and salt, due in part to the growth of consumers looking for “clean labels,” Iapichino says.

He adds that while most of the company’s retail sales are east of the Mississippi River, its Ricotta varieties have gained traction west of the river, as consumers have demonstrated a liking for the product’s flavor and texture profile.

To gain consumers’ attention and enthusiasm for the product in store, Biazzo works directly with retailers to execute marketing strategies, such as grouping its Ricotta with pasta and a jar of Italian sauce to give shoppers a recipe idea, Iapichino says.

At Saputo, the company markets differently across its sales segments, which include retail, foodservice and industrial.

The company continues to market recipes that reflect various rising trends in foodservice, but it oftentimes markets Ricotta as a lasagna component in retail.

“On the retail side, we are reaching more aspiring at-home chefs who appreciate that Ricotta can be used to make more sophisticated dishes,” Goldberg says.

To tie in with this trend, the company recently ran a Frigo brand promotion that gave consumers an opportunity to win high-end cookware and cooking classes. Saputo’s most popular variety, whole-milk Ricotta, is available under its Frigo, Dragone and Stella brands, Goldberg says.

In addition, the company aims to tie into regional Ricotta preferences. With its Dragone brand being popular in New England, the company recently sponsored a food and wine festival in Boston and hosted a Dragone tasting tent, where attendees could try product samples and recipes.

“Ricotta has been a relatively flat category for years, but it has shown slight growth recently,” Goldberg says, adding that in future years he expects sales to stay flat or exhibit slight growth.

“While there seems to be some potential for growth in alternative usages such as dips, spreads and appetizers, that growth could be offset by declines in lasagna consumption related to changes in cooking habits and skills,” Goldberg says. “Lasagna remains the major driver of Ricotta consumption.”

On the other hand, Iapichino anticipates sales could further increase as consumers and manufacturers continue to look for more healthy, “clean” meal options — a trend that may extend into the coming years.

Along with health factors, Ricotta’s broadening array of applications may contribute to a potential increase in future sales.

“It has become very popular lately,” Englert says. “There is an increasing demand from the public for this particular cheese because of its versatility and delicious taste.”



Farm groups take issue
with Dannon’s GMO pledge

October 21, 2016

ARLINGTON, Va. — The Dannon Co. made headlines earlier this year when it pledged to eliminate GMOs from its flagship brands, and also announced it would source milk only from cows given non-GMO feed. The yogurt company says its aim is to provide consumers with more choices.

However, this week leaders from a number of U.S. farming organizations sent a letter to Dannon CEO Mariano Lozano, calling the Dannon Pledge to eliminate GMOs an “attack on the livelihood and integrity of our farmers” and a “major step backward in truly sustainable food production.”

The groups say in their letter that Dannon’s strategy to eliminate GMOs “is the exact opposite of the sustainable agriculture that you claim to be seeking. Your pledge would force farmers to abandon safe, sustainable farming practices that have enhanced farm productivity over the last 20 years while greatly reducing the carbon footprint of American agriculture.”

The letter was co-signed by leaders of the National Milk Producers Federation (NMPF), American Farm Bureau Federation, American Soybean Association, American Sugarbeet Growers Association, National Corn Growers Association (NCGA) and U.S. Farmers and Ranchers Alliance.
The groups note that numerous studies have come out over the last 20 years proving the safety of GMO food and the environmental benefits of growing GM crops.

“Despite overwhelming evidence supporting the safety of GMO crops and their benefits to the environment, marketers of some major food brands, such as Dannon, have aligned themselves against biotechnology,” says Wesley Spurlock, NCGA president. “Farming organizations believe in open and honest communication with consumers and allowing people to make informed choices in the market. But we cannot sit by while certain food companies spread misinformation under the guise of a marketing campaign.”

The leaders of the six organizations, which represent hundreds of thousands of farmers and food producers across the country, urge Dannon to revise its pledge to recognize the sustainability, safety and environmental benefit of food biotechnology. They add that they would welcome the opportunity to discuss the matter further and offer assistance in developing “truly meaningful” measurements of agricultural sustainability that will characterize Dannon’s products.

“This is just marketing puffery, not any true innovation that improves the actual product offered to consumers,” says Randy Mooney, NMPF chairman and a dairy farmer from Rogersville, Missouri. “What’s worse is that removing GMOs from the equation is harmful to the environment — the opposite of what these companies claim to be attempting to achieve.”

The Dannon Co. responded, saying the company was “surprised to receive a divisive and misinformed letter about our efforts to continue to grow America’s enjoyment of dairy products, including yogurt.”

The company notes that its plans to use non-GMO ingredients and milk from cows fed non-GMO feed will apply to three of its brands — Dannon, Danimals and Oikos — which represent about half of its portfolio of products. For its entire portfolio, to help improve sustainable agricultural practices and protect biodiversity, Dannon says it is working with its farmer partners to reach for better soil health, water quality and quantity, an increase in biodiversity and a decrease in carbon emission and energy use.

Regarding GMO crops, Dannon says it believes currently-approved GMOs are safe and that sustainable agricultural practices can be achieved with or without the use of GMOs. However, citing a growing consumer preference for non-GMO ingredients and food in the United States, Dannon says it wants to provide products that address this consumer demand and allow consumers to make everyday choices for themselves.

“We believe strongly that the unparalleled range of choice that Danone’s U.S. affiliates provide, from organic, to non-GMO ingredients, and to conventional dairy, is a reason to celebrate rather than criticize,” Lozano says, encouraging anyone who wishes to learn more to read the Dannon Pledge at


Milk production climbs by more than 2 percent

October 21, 2016

WASHINGTON — Milk production in the 23 major milk-producing states during September totaled 15.98 billion pounds, up 2.3 percent from September 2015, according to data released Thursday by USDA’s National Agricultural Statistics Service (NASS). (All figures are rounded. Please see CMN’s Milk Production chart.)

August revised production in the 23 major states, at 16.66 billion pounds, was up 1.9 percent from August 2015. The August revision represents a decrease of 3 million pounds or less than 0.1 percent from last month’s preliminary production estimate.

Production per cow in the 23 major states averaged 1,842 pounds in September, 35 pounds above September 2015. This is the highest production per cow for the month of September since the 23-state series began in 2003, NASS says.

The number of milk cows on farms in the 23 major states was 8.67 million head, 36,000 head more than in September 2015, but 2,000 head less than in August 2016.

For the entire United States, NASS estimates September milk production was 16.97 billion pounds, up 2.1 percent from a year earlier. Production per cow in the United States averaged 1,817 pounds in September, up 33 pounds from a year earlier. NASS estimates there were 9.34 million cows on U.S. farms in September, up 21,000 head from September 2015 but 3,000 head less than in August 2016.

California led the nation’s milk production with 3.17 billion pounds of milk in September, down 0.1 percent from its production a year earlier. September production per cow in California was up 10 pounds from a year earlier to 1,795 pounds. However, the number of cows in the state declined by 11,000 head in the September-to-September comparison, dropping to 1.77 million head in September 2016. This was also a decline of 1,000 head from August 2016.

Wisconsin produced 2.44 billion pounds of milk in September, up 3.3 percent from its production a year earlier. Production per cow in Wisconsin in September was 1,910 pounds, 65 pounds more than a year earlier. The state was home to 1.28 million cows in September, down 2,000 head from September 2015 and down 1,000 head from August 2016.


Agropur makes plans to market its specialty cheeses in the U.S.

By Kate Sander

LONGUEUIL, Quebec — Agropur Cooperative, a major player in the Canadian dairy industry, has made headlines in the last few years with its acquisitions, including that of U.S.-based Davisco Foods in 2014. Now, the company is looking to expand its presence in the specialty cheese export market, particularly with new offerings for U.S. consumers.

In the coming year, Agropur’s export division will be renewing its focus, targeting the U.S. market with specialty foodservice and retail items, says Marcel Larivee, vice president, international trade, Agropur.

Agropur is a leading specialty cheese producer in Canada, particularly known for its OKA brand. The brand already is known in the United States, but in the past few years the co-op has done little to market it outside Canada.

“The focus was more domestic, but Agropur has grown quite a bit in the last five to eight years,” Larivee says, noting that the time is now right for Agropur to move into the U.S. market. In addition, with the product line and name already known, the OKA brand is the ideal flagship product for Agropur in the United States, Larivee says.

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Industry: Economic analysis
shows damage of GI abuses

October 14, 2016

WASHINGTON — If the European Union (EU) succeeds in extending its policies on geographical indications (GIs) to U.S. cheeses as they have in trade agreements in other parts of the world, the U.S. cheese industry could lose $5.2 billion in sales, and dairy farm revenues could drop $59 billion over 10 years, according to a new economic study released this week.

The 60-page analysis was commissioned by the Consortium for Common Food Names (CCFN), an international alliance of companies and organizations dedicated to preserving the right to use common food terms. It was conducted by Informa Economics IEG and unveiled Tuesday by CCFN, the National Milk Producers Federation (NMPF), the U.S. Dairy Export Council (USDEC) and the International Dairy Foods Association (IDFA).

According to these groups, a European farm policy agenda focused on using GIs to grant European food producers a commercial advantage, would force farmers and food producers outside of Europe to rebrand familiar foods with unfamiliar names. The resulting confusion in the U.S. marketplace could put family farms out of business, eliminate thousands of rural jobs and hurt the overall U.S. economy, the analysis says. The EU advocates extending GI protections beyond a small number of specialty foods to cover many food names that have little to no geographic identity and have long been commonly used by food producers around the world, the groups add.

“Under Europe’s GI policies, U.S. manufacturers would face a choice of abandoning markets for cheeses like feta and parmesan or selling them under names like ‘crumbly white cheese’ or ‘hard grated cheese,’” says Connie Tipton, president and CEO, IDFA. “It’s not hard to imagine the problems those name changes would create, and this report finally quantifies those impacts.”

The report used a case study approach, quantifying the impacts of GI protections on the Danish and German markets after the European Commission granted and activated protected designation of origin (PDO) status for various cheeses. The analysis indicates that Germany lost more than $259.6 million as a result of PDO implementation, driven by losses in the feta cheese market. Germany also suffered significant economic losses domestically. Similarly, Denmark lost more than $115 million after PDO protection became active for feta and parmesan. The report says on average, the PDO status for feta and parmesan in the EU created a 14-percent price decrease in EU countries producing these product types.

Multiple econometric techniques then were used to determine how enforcing European GIs on U.S. cheese with common names would impact the U.S. dairy industry. The study found that in 10 years, such policies could:

• Reduce U.S. cheese consumption up to 21 percent, or 2.3 billion pounds, totaling up to $5.2 billion in lost cheese sales based on current prices.

• Push U.S. dairy farm margins below the break-even point in up to six out of 10 years, costing farmers a cumulative $59 billion in revenues.

• Reduce the size of the national dairy herd up to 9 percent, or 852,000 cows, putting many farms out of business.

• Close numerous cheese plants, especially specialty cheese manufacturing plants.

• Limit choices and raise prices for cheese varieties with familiar names.

According to the study, consumers will choose imported cheeses with names they recognize over domestic products with names they don’t recognize. As a result, demand for domestic cheese will fall. The study also notes that potential damages extend beyond just the dairy industry. As impacts on dairy ripple through industries such as grain farming, transportation and veterinary services, the U.S. economy could lose up to 175,000 jobs and $23 billion in gross domestic product in the short run.

The full report is available at

Jim Mulhern, president and CEO, NMPF, says the EU’s policies on GIs are not just a theoretical concern. They already have affected the ability for U.S. exporters to sell cheese in South Korea and other markets abroad. He adds that the U.S. dairy industry was greatly encouraged when House Ways and Means Committee Chairman Kevin Brady, R-Texas, and Senate Finance Committee Chairman Orrin Hatch, R-Utah, sent a letter last week to U.S. Trade Representative Michael Froman raising concerns over Europe’s use of GIs. (See “House, Senate committee leaders ‘troubled’ by EU attempt to include GIs in trade deals” in last week’s issue of Cheese Market News.)

“The terms they used in the letter were that the European Union has a pattern of ‘hostage taking’ in TTIP (Transatlantic Trade and Investment Partnership) negotiations,” Mulhern says. “These common food names should not be hostages or pawns in any trade agreement. We are heartened by Capitol Hill that they are reinforcing our position on common food names.”

Other lawmakers also have stressed the importance of protecting common food names in trade agreements.

“Europe’s plan to expand geographical indications will harm American farmers, manufacturers and consumers,” says Speaker of the House Paul Ryan, R-Wis. “Open and free trade cannot occur with this kid of GI system. Parmesan, feta, asiago and many other Wisconsin cheeses have won international acclaim, and they should be able to compete fairly in the market.”

Senate Ag Committee Chairman Pat Roberts, R-Kan., says while there are legitimate uses for GIs, the EU’s approach has been to block market access for U.S. products using common food names.
“This study shows what has been apparent for some time,” Roberts says. “If the U.S. gives in to the EU’s demands on GIs, it will have a significantly negative impact on the U.S. economy — from dairy farmer to the local grocer to the consumer at home.”

Rep. Peter Welch, D-Vt., who co-chairs the Congressional Dairy Farmer Caucus, agrees that Europe’s GI agenda must be rejected.

“Vermont makes some of the finest cheeses in the world,” Welch says. “This push to restrict common cheese names in use for hundreds of years in Vermont and around the globe is in reality an attempt to force competitors out of business.”

CCFN Executive Director Jaime Castaneda says these comments show the common food names issue is incredibly important to both Congress and the executive branch.

“We appreciate the continuing efforts of the vast majority of members of Congress as well as Ambassador Michael Froman and Agriculture Secretary Tom Vilsack to combat the illegitimate appropriation of common food names,” Castaneda says.

While the protection of common names has been supported by U.S. trade and congressional leaders, it still is important to have tools such as this economic impact study to support negotiations, says USDEC President Tom Suber.

“In the final days of negotiations, with the intensity of issues that have not been settled in final days, the pressure for concession is hard to underestimate,” Suber says. “This study was done to make the issues clear and to help our negotiators to have analytical backing in the final days, should those come.”

The 15th round of TTIP negotiations between the United States and EU took place last week in New York. Among the topics discussed at this round were rules of origin, intellectual property and agriculture, including market access and sanitary and phytosanitary (SPS) measures.



USDA to buy more cheese;
industry mixed on impact

October 14, 2016

WASHINGTON — U.S. Agriculture Secretary Tom Vilsack this week announced that USDA is offering to purchase $20 million of Cheddar to reduce a private cheese surplus that has reached record levels, while assisting food banks and other food assistance recipients.

While USDA projects dairy prices to increase throughout the rest of the year, many factors including low world market prices, increased milk supplies and inventories, and slower demand have contributed to a sluggish marketplace for dairy producers and caused dairy revenues to drop 35 percent over the past two years, Vilsack says. Section 32 of the Agriculture Act of 1935 authorizes USDA to purchase surplus food to benefit food banks and families in need through its nutrition assistance programs.

“America’s farming families are being called on to demonstrate their world-famous resourcefulness and resilience in the face of this current market downturn, and USDA is making use of every tool that we have to help them,” Vilsack says. “For dairy farmers, this has included $11.2 million in payments in August through the Dairy Margin Protection Program (MPP), in addition to the surplus purchase offers.

Vilsack adds that reducing the surplus can provide extra reassurance while also filling demand at food banks and other organizations that help families in need.

He notes that farmers at other points in the supply chain also are receiving a boost with more than $7 billion in Agriculture Risk Coverage and Price Loss Coverage payments for the 2015 crop year, which by design kick in when times are tough.

“As always, we continue to watch market conditions and will explore opportunities for further assistance in the coming months,” Vilsack says. “For producers challenged by weather, disease and falling revenue, we will continue to ensure the availability of a strong safety net to keep them farming or ranching.”

A solicitation will be issued shortly, and cheese deliveries to food banks and other food assistance recipients are expected to occur beginning in March 2017.

The announcement was met with mixed reactions in the dairy industry.

The International Dairy Foods Association (IDFA) notes there were few private sector bids offered and awarded under an earlier solicitation from USDA this summer.

“We are somewhat surprised that USDA is purchasing an additional amount of cheese, given the results of the first solicitation,” says Ruth Saunders, vice president of policy and legislative affairs, IDFA.

USDA in late August announced plans to purchase approximately 11 million pounds of cheese, also valued at $20 million, from private inventories to assist food banks and pantries across the nation, while reducing the nation’s cheese surplus. (See “USDA to purchase cheese to aid dairy market stability” in the Aug. 26, 2016, issue of Cheese Market News.)

However, USDA did not meet that target and was able to buy only $7 million of the $20 million it attempted to purchase for donation due to a lack of response from cheese processors, notes the California Dairy Campaign (CDC), a statewide membership association of family dairy farmers.

“We appreciate that Secretary Vilsack is acting within his limited authority to address the ongoing dairy crisis,” says Lynne McBride, executive director, CDC. “But when the initial cheese purchase was announced, we were concerned that it would not directly assist dairy farmers, and our concerns proved to be well warranted. We were surprised by the lack of the response to the cheese purchase and considered it a strong indicator that there is not in fact a cheese surplus.”

McBride says in the short term, it is critical that Congress grant USDA the authority to provide direct disaster relief under Section 32, and in the long term, CDC supports comprehensive reform of federal dairy programs in the next farm bill.

“In California, participation in the Dairy Margin Protection Program has been extremely low above the catastrophic $4 margin level because the margins in that program do not reflect actual on-farm margins,” she says.

Meanwhile, the National Milk Producers Federation (NMPF) says the cheese purchase will provide assistance to America’s dairy farmers through increased demand for milk, while also serving the needs of Americans who patronize food banks and other charitable assistance organizations.

“We continue to look at ways to address the challenging economic situation facing dairy farmers, and are appreciative of USDA’s efforts to improve the effectiveness of the Dairy Margin Protection Program established in the 2014 Farm Bill,” NMPF says. “Further changes are needed to improve the program as an effective safety net, but such changes go beyond the authority granted to USDA by Congress. We will continue working with congressional leaders to seek improvements to MPP.”



USDA report: Dairy sector
growth hinges on trade

October 14, 2016

WASHINGTON — A new report released this week by USDA’s Office of the Chief Economist (OCE) shows continued growth of the U.S. dairy sector is largely contingent on trade.

The report, “Why Trade Agreements Matter: The Case for U.S. Dairy,” also estimates that the Trans-Pacific Partnership (TPP) could create an additional $150 million to $300 million in annual U.S. dairy exports.

USDA notes that strong growth in overseas demand has helped fuel U.S. dairy exports, while domestic structural and policy adjustments have enhanced U.S. competitiveness.

According to the report, U.S. dairy exports have grown by more than fivefold over the past 15 years, reaching a record $7.1 billion in 2014. While 2015 exports decreased due to strong global dairy supplies, weaker import demand and an appreciation of the U.S. dollar, the longer-term USDA 10-year forecast projects record export levels.

U.S. dairy exports also are important to the broader U.S. economy, the report says. USDA’s Economic Research Service (ERS) estimates that at the primary milk production level, each dollar of U.S. dairy exports generates nearly $3 in additional economic output; for each $1 billion in dairy exports, around 20,000 jobs are supported, USDA says.

Continued growth of the U.S. dairy sector is largely contingent on trade, the report adds. The share of U.S. milk production that is exported has tripled from the year 2000 to around 14-15 percent. The U.S. market is fairly mature, and per capita consumption is not expected to expand significantly, which makes overseas markets increasingly important to producers’ returns, USDA says.

USDA says free trade agreements (FTAs) have contributed to the growth in U.S. dairy exports and helped to address tariff and non-tariff barriers that place U.S. products at a competitive disadvantage in overseas markets.

U.S. dairy exports to free trade agreement partners grew from $690 million in the year prior to each agreement’s entry into force to $2.8 billion in 2015, USDA says, adding that the increase was driven by lower trade barriers and increased U.S. competitiveness.

The TPP agreement covers 12 countries and expands dairy market access in several key Asian countries, such as Japan, Vietnam and Malaysia, and provides new access into Canada, the report notes. The TPP also breaks new ground with rules on non-tariff barriers, including sanitary and phytosanitary measures, geographical indications, biotechnology and organics. TPP addresses the competitive advantages other suppliers have gained in this region, USDA says.

In the report, OCE presents estimates of the medium- to long-run dairy trade effects of TPP dairy market access provisions. The analysis projects an additional $150 to $300 million in annual U.S. dairy exports as a result of TPP. While U.S. dairy imports show some growth ($30 million to $100 million a year), particularly for butter, the United States maintains a net export position.

Other TPP analysis shows similar results, the report notes. The American Farm Bureau Federation (AFBF) estimates that annual U.S. net farm income could grow by $4.4 billion and annual U.S. net agricultural exports by $5.3 billion, if TPP is implemented. The U.S. dairy sector also benefits, with cash receipts and net dairy exports projected to grow $275.3 million and $131.2 million, respectively, USDA says.

In addition, the U.S. International Trade Commission’s (USITC) economic review of TPP projects U.S. agricultural exports would be $7.2 billion higher in 2032, with U.S. dairy exports forecast at $1.8 billion higher, USDA notes. The USITC model looks at the full economy and cross-commodity effects of full (long-term) implementation. It also covers trade in all dairy products, including higher value processed items (ice cream, infant formula, etc.) not covered in the AFBF and OCE analyses.

To view the USDA report, visit


USDA forecasts milk supply to rise,
lower prices

October 14, 2016

WASHINGTON — In its latest “World Agricultural Supply and Demand Estimates” report released this month, USDA raised its forecasts for 2016 and 2017 U.S. milk production and, as a result, lowered its price forecasts for cheese and butter.

As cow inventory has grown more rapidly that previously expected, USDA has upped its 2016 milk production forecast to 212.7 billion pounds, up 500 million pounds from last month’s report. For 2017, USDA is now projecting milk production will reach 217.3 billion pounds, an increase of 1.2 billion pounds from its forecast last month. The higher cow inventories appear to reflect growth in herds supplying expanding dairy product facilities, USDA says.

Because of the higher expected milk supplies, USDA this month lowered its cheese price forecast for 2016 to $1.550-$1.560 per pound, down from $1.600-$1.620 in last month’s report. In 2017, USDA forecasts cheese will average in the $1.510-$1.600 range, down from its forecast of $1.605-$1.705 last month.

The 2016 butter price forecast is now $2.040-$2.070, down from $2.080-$2.120. In 2017, USDA forecasts butter in the $1.855-$1.975 range, down from last month’s forecast of $1.955-$2.085.

However, USDA says nonfat dry milk (NDM) and whey likely will benefit from increased competitiveness in export markets, and stronger exports will help support prices of those products. Thus, the 2016 NDM price forecast is raised to $0.825-$0.845, up from $0.810-$0.830 last month, and the 2017 NDM price forecast is increased to $0.925-$0.995, up from $0.890-$0.960 last month. The dry whey forecast for 2016 is increased to $0.270-$0.280, up from $0.260-$0.280, and for 2017 it is increased to $0.330-$0.360, up from $0.295-$0.325.

The Class III and Class IV price forecasts are lowered from last month as lower cheese prices more than offset the higher whey prices in the Class III calculation and the lower butter prices outweigh the NDM price increases in the calculation of the Class IV price. The 2016 Class III price forecast is now $14.30-$14.40 per hundredweight, and in 2017 is forecast at $14.20-$15.10. The 2016 Class IV price forecast is $13.60-$13.80; the 2017 Class IV price forecast is $13.70-$14.70.

The 2016 all-milk price forecast is lowered to $15.80-$15.90, down from $16.10-$16.30 in last month’s report, and the 2017 all-milk price forecast is lowered to $15.55-$16.45, down from $16.15-$17.15.

Dairy exports are forecast higher as increases in Oceania prices and relatively low U.S. prices are expected to make the United States more competitive in world markets. Import forecasts for 2016 and 2017 are raised on higher expected imports of butter and several other dairy products. The forecasts for ending stocks are reduced as lower prices encourage increased demand from both export and domestic markets.


‘Back on track’ — Babcock Hall,
CDR project to advance

October 7, 2016

By Alyssa Mitchell

MADISON, Wis. — A project to renovate the University of Wisconsin-Madison’s (UW) Babcock Hall Dairy Plant and to construct a new Center for Dairy Research (CDR) is back on track following budget and design concerns raised this summer.

The project, which originally was scheduled to break ground this summer with a 26-month construction period, was delayed after the university revealed that the original design would cost $11 million more than initially planned. (See “Design, budget concerns delay UW’s Babcock Hall, CDR project” in the July 8, 2016, issue of Cheese Market News.)

The dairy industry raised more than $18 million for the construction of a world class research center adjacent to Babcock Hall, according to John Umhoefer, executive director of the Wisconsin Cheese Makers Association (WCMA). A fundraising campaign led by WCMA, CDR and the Wisconsin Milk Marketing Board began in 2012 after plans were announced for the project, and several WCMA members are invested.

When stakeholders learned of the budget discrepancy this summer, concerns mounted over the fate of the project and the outcome of the final design. The UW College of Agriculture and Life Sciences (CALS) was considering revising the original design blueprints, and project donors expressed strong concern about cost overruns impacting the CDR addition during a meeting in June with UW officials.

According to Umhoefer and CALS officials, those concerns largely have been laid to rest following several meetings between university and state officials and dairy industry stakeholders over the past few months, and the project is now moving forward.

“Over the last several months, there have been a number of meetings to come to resolutions on the scope of the building, to stay within budget, and specific elements of the design,” says Heidi Zoerb, associate dean for external relations and advancement, CALS.

WCMA echoed that sentiment, noting productive meetings between UW officials, CDR staff, CALS leaders and dairy industry representatives have built consensus around key objectives for the plans and budgets in the CDR building project.

Speaking this week at the World Dairy Expo to members of the Wisconsin Dairy Products Association (WDPA), many of whom also are stakeholders in the project, CALS Dean Kathryn VandenBosch says the project is “back in scope.” A building design now will move forward that returns the existing Babcock Hall ice cream plant to its current footprint for renovation and redesign and constructs an enlarged CDR adjacent to Babcock Hall. Priority criteria for design include efficiency with costs and square footage but also minimizing downtime with the phasing of the project as well as food safety manufacturing best practices and food safety product flow through the facility, she says.

“Not only is it a research facility and a production facility, but it’s also a place for training,” VandenBosch says, noting the facility will be utilized by enrolled students, undergraduate and graduate students, as well as people in the industry, so food safety is important from a training standpoint, too.

Umhoefer says discussions continue to trim from the project budget, but the $11 million cost overrun unveiled in June has been substantially reduced. Savings are coming from building modifications that do not impact key programs at the dairy plant or CDR, and reductions in new equipment for both facilities.

In addition, UW is putting $1.2 million toward the project for various equipment and an upgrade to the dairy plant loading dock, Zoerb says.

“These were not included in the original (plans) but will help the building function,” she says.

“I think in a lot of ways, this project is really unique with all the industry partners involved who want to make this the best facility it can be,” Zoerb adds. “It’s why we’re ‘America’s Dairyland.’ We want to showcase a world-class dairy research center here in Wisconsin.”

Umhoefer agrees, noting 25 processors were in attendance at a meeting this week alone.

“The participation speaks to the importance of the project and moving forward,” he says. “We’re back on track. It’s going to be a great building, and there are good feelings all around.”

VandenBosch says design and specification work will begin immediately with the project ready for bid in April. Officials anticipate breaking ground on the project next fall.



International experts discuss
key global dairy sector trends

October 7, 2016

By Alyssa Mitchell

MADISON, Wis. — A panel of international experts convened Thursday at the 50th annual World Dairy Expo to discuss the unprecedented, complex mix of challenges and opportunities facing dairy industries around the world.

The Global Dairy Symposium — hosted by the Wisconsin Department of Agriculture, Trade and Consumer Protection in collaboration with the University of Wisconsin-River Falls — featured presentations from Sharon Sydow, senior economist with USDA’s Office of the Chief Economist; Thomas Bailey, executive director and senior analyst at the Food & Agribusiness Research and Advisory Group of Rabobank; and Robert M. Erhard, agricultural material specialist, dairy, for Nestlé. U.S. Dairy Export Council President Tom Suber moderated a panel discussion during the session.

Bailey provided an overview of the global dairy market. He notes that six of the seven major dairy exporting regions are seeing their milk supply contract.

The exception is the United States, which still has a growing milk supply.

Bailey notes that U.S. milk production is projected to continue to grow through the next 18 months as low feed costs are helping to boost supply.

Growth in the U.S. milk supply is slowing inching eastward, he adds, and at the current trajectory, Wisconsin is anticipated to become the No. 1 milk-producing state by October 2019.

However, high stocks, particularly for cheese and butter, are pressuring prices, Bailey says.

“Global inventories are also very weighty on prices, but less of a concern,” he adds.
The high value of the U.S. dollar contributes additional pressure, but U.S. dairy exports are beginning to pick back up in spite of these factors, particularly as U.S. dairy prices fall closer in line with global prices, Bailey says.

Sydow notes that according to the latest World Agricultural Supply and Demand Estimates (WASDE) report released last month by USDA, U.S. dairy exports are projected to rebound, while U.S. dairy imports are expected to start decreasing slightly. (For more from last month’s WASDE report, see “High supply leads to lower USDA cheese price forecast” in the Sept. 16, 2016, issue of Cheese Market News.)

The next WASDE report is scheduled for release next week.

Sydow also highlighted the importance of key trade agreements for U.S. dairy. She notes that the United States has become increasingly export-oriented and is well-positioned to respond to increased overseas demand and new market openings through trade agreements, including free trade agreements (FTAs).

The United States is the third-largest dairy exporter in the world behind New Zealand and the European Union, she adds.

“U.S. dairy exports to FTA partners have grown from $476 million in 2000 to $2.8 billion in 2015,” Sydow says.

She adds that, according to USDEC and the National Milk Producers Federation, increased trade from FTAs helped bring an additional $8.3 billion to the U.S. dairy industry over 10 years and contributed to higher U.S. milk prices and incomes during that period.

Many U.S. FTA partners are developing countries, where demand growth is expected to be the strongest, she says, and most U.S. FTAs are with partners in the Western Hemisphere region — Australia, South Korea and Singapore are the only U.S. FTAs in Asia-Pacific region.

Meanwhile, Erhard provided insight into what one international dairy company, Nestlé, is doing to stay relevant in an ever-changing dairy landscape.

As consumers are looking at brands more holistically and technology has transformed the dairy sector, there is opportunity to add value to gain a competitive advantage, Erhard says.

“Consumers will pay more attention to buying products that reflect their own values,” he says.

Trust is a key purchasing driver, and consumers are looking for information on how their food is made, where it comes from and whether companies are implementing sustainable business practices.

Still, one company alone cannot make the difference, and the industry needs to work together on a pre-competitive basis to build trust with consumers with best practices in animal welfare, sustainability, transparency, food safety, traceability and more, Erhard says.



WDE dairy product contest
auction raises $30,225

October 7, 2016

MADISON, Wis. — The 14th annual World Dairy Expo (WDE) Championship Dairy Product Contest auction took place Tuesday at the World Dairy Expo. The auction raised $30,225.

“This year’s contest was another overwhelming success,” says Brad Legreid, executive director, WDPA, which sponsored the contest.

There was a record number of dairy products entered this year, with the entries reflecting the diversity of dairy products manufactured throughout North America, WDPA adds.

Forty-eight sensory experts from USDA, universities and industry judged the products over a three-day period in August. The 76 first place winners received their trophies at the auction and will be afforded opportunities to promote and market their award-winning products.

A portion of the auction proceeds will be used to fund the Dr. Robert L. Bradley Scholarship, WDPA Scholarship and Madison Area Technical College (MATC) Culinary Foundation Scholarship, which will be awarded annually to deserving students pursuing careers in the dairy industry. WDPA also will use a portion of the proceeds to fund a major sponsorship of the National Collegiate Dairy Product Judging Contest.

In addition, product donations have been made in the past to the MATC Culinary Arts School, University of Wisconsin-Madison Food Science Department, the Ronald McDonald House and Second Harvest Food Bank.

Following are the winning bidders for all classes. In some cases, classes were combined into one lot for bid.

• Lot 1: Cheddar — DSM, Menomonee Falls, Wisconsin, purchased the 40 pounds of Cheddar made by Associated Milk Producers Inc. (AMPI), Sanborn, Iowa, for $35 per pound for a total of $1,400.

• Lot 2: Sharp Cheddar — Masters Gallery Foods, Plymouth, Wisconsin, purchased the 40 pounds of Sharp Cheddar made by Land O’Lakes, Kiel, Wisconsin, for $20 per pound for a total of $800.

• Lot 3: Reduced Fat Cheese — DSM purchased the 10 pounds of Reduced Fat Provolone made by Foremost Farms, Clayton, Wisconsin, for $55 per pound for a total of $550.

• Lot 4: Flavored Natural/Cold Pack Combined Classes — Masters Gallery Foods purchased the combined 34 pounds of Three Cheese Chile Pepper Gouda made by Emmi Roth USA, Fitchburg, Wisconsin; Pepper Muenster made by Mill Creek Cheese, Arena, Wisconsin; and Smoked Gouda made by Saxon Cheese LLC, Cleveland, Wisconsin, for $50 per pound for a total of $1,700.

• Lot 5: Butter Class — AgSource Cooperative Services, Verona, Wisconsin, purchased the combined 34 pounds of Spreadable Butter with Canola Oil made by California Dairies Inc., Visalia, California; Unsalted Butter made by West Point Dairy Products, Greenwood, Wisconsin; and 80-percent Salted Butter made by California Dairies Inc., Visalia, California, for $15 per pound for a total of $510.

• Lot 6: Yogurt Combined Class — Dr. Robert Bradley purchased the combined 14 pounds of Guanabana Yogurt Smoothie made by RFG Dairy LLC, Bedford Park, Illinois; Low Fat Blueberry Yogurt made by Belfonte Ice Cream & Dairy Foods, Kansas City; and 2-percent Blended Coconut Yogurt with Pineapple made by Commonwealth Dairy LLC, Brattleboro, Vermont, for $15 per pound for a total of $210.

• Lot 7: Plain Greek Yogurt — Ecolab, St. Paul, Minnesota, purchased the 6 pounds of Plain Greek Yogurt made by Westby Cooperative Creamery, Westby, Wisconsin, for $100 per pound for a total of $600.

• Lot 8: Open Class Hard Cheese — Wisconsin Aging and Grading Cheese, Kaukauna, Wisconsin, purchased the 20 pounds of Sartori Reserve Chipotle BelloVitano made by Sartori Co., Plymouth, Wisconsin, for $60 per pound for a total of $1,200.

• Lot 9: Ice Cream/Frozen Yogurt Combined Class — G&R Foods, Reedsburg, Wisconsin, purchased the combined 28 pounds of Black Raspberry Chocolate Chip Frozen Yogurt made by Gifford’s Famous Ice Cream, Skowhegan, Maine; Cherry Vanilla Chunk Ice Cream made by Yuenglings Ice Cream, Orwigsburd, Pennsylvania; and Vanilla Ice Cream made by Lochmead Dairy, Junction City, Oregon, for $40 per pound for a total of $1,120.

• Lot 10: Aged Cheddar — Organic Valley, LaFarge, Wisconsin, purchased the 40 pounds of Aged Cheddar made by Masters Gallery Foods for $30 per pound or a total of $1,200.

• Lot 11: Prairie Farms Combined Class — Kerry Ingredients, Waunakee, Wisconsin, purchased the combined 7 pounds of No Fat Cottage Cheese and Regular 4-percent Cottage Cheese made by Prairie Farms Dairy, Carbondale, Illinois; and Strawberry Yogurt made by Prairie Farms Dairy, Quincy, Illinois, for $140 per pound for a total of $980.

• Lot 12: Cold Pack Cheese — Wisconsin Aging and Grading Cheese purchased the 12 pounds of Swiss and Almond Cold Pack Cheese made by Pine River Pre Pack Inc., Newton, Wisconsin, for $90 per pound for a total of $1,080.

• Lot 13: UMPQUA Combined Class — Cheese Market News, Madison, Wisconsin, purchased the combined 7 pounds of Vanilla Bean Ice Cream and Regular Sour Cream made by UMPQUA Dairy Products, Roseburg, Oregon, for $40 per pound for a total of $280.

• Lot 14: AMPI Combined Class — Masters Gallery Foods purchased the combined 62 pounds of Pasteurized Processed Monterey Jack and American Cheese with Peppers and Pasteurized Processed American Cheese Slices made by AMPI, Portage, Wisconsin; and Colby Jack made by AMPI, Jim Falls, Wisconsin, for $125 per pound for a total of $7,750.

• Lot 15: Stewarts Combined Class — AgSource Cooperative Services purchased the combined 12 pounds of Milk Chocolate Gelato and Dark Chocolate Ice Cream made by Stewarts, Saratoga Springs, New York, for $35 per pound for a total of $420.

• Lot 16: Southeastern Grocers Combined Class — Galloway Co., Neenah, Wisconsin, purchased the combined 5 pounds of French Vanilla Ice Cream and Strawberry Cream Cheese made by Southeastern Grocers, Jacksonville, Florida, for $60 per pound for a total of $300.

• Lot 17: Combined Class — T.C. Jacoby & Co., St. Louis, purchased the combined 32 pounds of Point Reyes Original Blue made by Point Reyes Farmstead Cheese Co., Point Reyes, California; Low Moisture Park Skim Mozzarella String Cheese made by Baker Cheese Factory Inc., St. Cloud, Wisconsin; and Fresh Mozzarella made by Crave Brothers Farmstead Cheese, Waterloo, Wisconsin, for $40 per pound for a total of $1,280.

• Lot 18: DFA Combined Class — Galloway Co. purchased the combined 24 pounds of Provolone made by Dairy Farmers of America, New Wilmington, Pennsylvania; and Mozzarella made by Dairy Farmers of America, Turlock, California, for $35 per pound for a total of $840.

• Lot 19: Combined Class — Wisconsin Aging and Grading Cheese purchased the combined 21 pounds of Soda Fountain Malted Milk made by CTL Foods Inc., Colfax, Wisconsin; and Land O’Lakes French Onion Dip made by Dean Foods Co., Rockford, Illinois, for $65 per pound for a total of $1,365.

• Lot 20: Muenster — T.C. Jacoby & Co. purchased the 12 pounds of Muenster made by Fair Oaks Farms, Fair Oaks, Indiana, for $70 per pound for a total of $840.

•Lot 21: Hiland Combined Class — Kerry Ingredients purchased the combined 6 pounds of Chocolate Ice Cream made by Hiland Dairy, Springfield, Missouri; Southwest Ranch Dip made by Hiland Dairy Foods, Norman, Oklahoma; and Sassy Salsa Dip made by Hiland Dairy Foods Co., Omaha, Nebraska, for $65 per pound for a total of $390.

• Lot 22: Combined Class — Darlington Dairy Supply, Darlington, Wisconsin, purchased the combined 25 pounds of Queso Oaxaca Cheese made by Marquez Bros. International Inc., Hanford, California; and Baby Swiss Wheel made by Chalet Cheese, Monroe, Wisconsin, for$45 per pound for a total of $1,125.

• Lot 23: Cedar Crest Class — CTL Foods, Colfax, Wisconsin, purchased the combined 18 pounds of Sunset Rainbow Sherbet made by Cedar Crest Specialties, Manitowoc, Wisconsin, for $40 per pound for a total of $720.

• Lot 24: Lactalis Combined Class — AgSource Cooperative Services purchased the combined 22 pounds of Triple Cream made by Lactalis USA, Belmont, Wisconsin; and Rondele Sea Salt & Cracked Pepper Gourmet Spreadable Cheese made by Lactalis USA Inc., Merrill, Wisconsin, for $40 per pound for a total of $880.

• Lot 25: Combined Cheese Class — Wisconsin Aging and Grading Cheese purchased the combined 15 pounds of Blueberry Vanilla Chevrai made by Saputo Specialty Cheese, Richfield, Wisconsin; and Cello Thick and Smooth Mascarpone made by Arthur Schuman Inc., Fairfield, New Jersey, for $30 per pound for a total of $450.

• Lot 26: Combined Class — Cheese Market News purchased the combined 5 pounds of Lowfat Sour Cream made by Cabot Cooperative Creamery, Waitsfield, Vermont; and Pineapple Cottage Cheese made by Upstate Niagara Cooperative, Buffalo, New York, for $65 per pound for a total of $325.

• Lot 27: Ice Cream Grand Champion — Cedar Crest Specialties purchased the 4 pounds of Vanilla Custard & Strawberry Lemon Fruit made by Double Rainbow Ice Cream, San Francisco, California, for $50 per pound for a total of $200.

• Lot 28: Grade A Grand Champion — Kerry Ingredients purchased the 6 pounds of Lemon Aussie made by Schreiber Foods, Green Bay, Wisconsin, for $85 per pound for a total of $510.

• Lot 29: Cheese & Butter Grand Champion — Galloway Co. purchased the 12 pounds of Aged Butterkase made by Saxon Cheese LLC for $100 per pound for a total of $1,200.


MMPA purchases Deutsch Käse Haus
from Guggisberg

October 7, 2016

NOVI, Mich. — The Michigan Milk Producers Association (MMPA) this week announced its purchase of Guggisberg’s Deutsch Käse Haus cheese plant in Middlebury, Indiana. MMPA says this acquisition from Guggisberg Cheese Co. of Millersburg, Ohio, diversifies its dairy product portfolio, which currently includes butter, powder and other fluid milk products.

“We are eager to continue to grow our footprint in the Great Lakes region and utilize the expertise at Deutsch Käse Haus to gain greater diversity of our product portfolio,” says Joe Diglio, general manager, MMPA. “MMPA members have a proven track record of producing high-quality milk, and to be able to align with an award-winning cheese plant located in close proximity to our Constantine plant provides great synergies in our milk marketing strategy.”

Deutsch Käse Haus — translated as “German Cheese House” — was founded in 1979 to serve the needs of local Amish dairy farmers. Today, the plant processes around 400,000 pounds of milk per day and employs 55 people. MMPA says it plans to retain the current employee team following the ownership transition Nov. 1.

“The Deutsch Käse Haus has a valuable and trusted legacy in Indiana,” says Richard Guggisberg, owner of Guggisberg Cheese Co. “I am confident MMPA will carry on this legacy as we move forward, bringing mutual benefit to both Guggisberg Cheese Co. and MMPA. MMPA has a strong membership base in northern Indiana, and Deutsch Käse Haus will be able to continue producing high-quality products under new ownership.”

The Deutsch Käse Haus plant primarily produces Colby as well as Colby Jack, Monterey Jack, Cheddar, Pepper Jack and other varieties.

MMPA says following the acquisition, it intends to continue manufacturing the current types of cheeses made at the plant. The investment positions MMPA to further explore expansion opportunities at the Middlebury plant location in the future, the cooperative adds.

MMPA serves approximately 2,000 dairy farmers in Michigan, Indiana, Wisconsin and Ohio. MMPA owns milk processing plants in Ovid and Constantine, Michigan, and the cooperative handles more than 5 billion pounds of milk annually.


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Today's Cheese Spot Trading
October 26, 2016

Barrels: $1.5575 (-1/4)
Blocks: $1.6550 (+1 3/4)

Click here for more market activity
Cheese Production
U.S. Total August
989.969 mil. lbs.

Milk Production
U.S. Total Sept.
16.967 bil. lbs.

Guest Columnist

$2 cheese may arrive
sooner than you think

Eric Meyer, HighGround Dairy

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