Covering Ag since 1981. The faces, places, markets and issues of dairy and livestock production. Hard-hitting topics, market updates and inspirational stories from the notebook of a veteran ag journalist. Contributing reporter for Farmshine since 1987; Editor of former Livestock Reporter 1981-1998; Before that I milked cows. @Agmoos on Twitter, @AgmoosInsight on FB #MilkMarketMoos
WASHINGTON –- USDA officially announced Monday (July 24) the national public hearing to consider proposals seeking to amend the uniform pricing formulas across all 11 Federal Milk Marketing Orders (FMMO). The hearing begins Wednesday, August 23, 2023 at 9:00 a.m. at the 502 East Event Centre, 502 East Carmel Drive, Carmel, Indiana.
Farmers will be able to testify in person at any time, or virtually on Fridays by pre-registering.
Approximately 40 proposals were submitted by 12 organizations and were explained during a webinar in mid-June. Of those, 21 will be considered within the uniform pricing scope of the hearing, according to the USDA notice. Copies of the notice, a list of proposals being considered, guidelines for how to participate, the hearing schedule, and corresponding hearing record can be found and followed on the Hearing Website.
The Class I mover formula will be addressed in the national hearing’s scope, including the proposals from National Milk Producers Federation and American Farm Bureau to go back to the ‘higher of’ method. The change from ‘higher of’ to ‘average of’ was made legislatively in the 2018 farm bill without a hearing.
Since USDA implemented the ‘average of’ method in May 2019, net losses from this change are projected to exceed $1 billion after August 2023 milk is paid for in September.
On July 19, USDA announced the August advance Class I price mover at $16.62. If the previous ‘higher of’ method had been used, the Class I base price would have been $18.29. That’s a $1.67 per hundredweight loss on all Class I milk next month. July’s Class I mover was also calculated substantially lower (by $1.02) using the ‘average of’ vs. the ‘higher of.’ These losses will impact August and September milk checks for July and August milk.
Around 28% of all milk produced in the U.S. is Class I fluid use, so farmers stand to lose an additional 47 cents per hundredweight on all of the milk they market in August and 29 cents on all the milk they market in July — just from this formula change. This is on top of the market declines in the class and component prices. The loss to blended prices will be greater in some Federal Orders and less in others, and this does not include the impacts from de-pooling of higher-value Class IV milk.
The impact of the two-week Class I advance pricing factors is compounded by the ‘average of’ method, which is quite notable for July and August. Cheese and whey were in a tailspin lower; however, on the very next day after the August Class I base price mover had been averaged and locked-in on July 1-15 pricing factors, the dairy product markets began a huge rally, with cheese gaining nearly 40 cents in 8 trading sessions. This boosts the other class and component values much higher for the latter half of the month.
Over the 52 months of its implementation, the ‘average of’ formula has effectively removed an estimated 55 cents per hundredweight from farmer payment for all Class I milk, according to USDA data. On a blended uniform price, this comes out to a national average loss of 16-cents on every hundredweight of all milk used in all classes of products shipped from May 2019 through August 2023. That is like paying another checkoff for 52 months.
Among the other proposals included in the national hearing is the American Farm Bureau (AFBF) Class I and II proposal that seeks return to the ‘higher of’ with additional adjustments such as eliminating the two-week ‘advanced’ pricing.
IDFA’s Class I proposal seeks to keep the ‘average of’ and use either the current 74-cent-adjuster or a ‘rolling adjuster’ based on a calculated difference over 24 months, whichever is higher.
Milk Innovation Group’s (MIG) proposal seeks to keep the ‘average of’ but change the ‘adjuster’ monthly via a 24-month look-back with a 12-month lag.
Two Edge Cooperative proposals are included, one being a Class III-plus formula. The other would use the ‘higher of,’ but would base it on end-of-month four-week announced class and component prices instead of the two-week prior month advance pricing.
The hearing docket also contains four proposals on Class I differentials, including NMPF’s proposal to increase them in all locations by varying amounts as well as MIG’s proposal to lower them across the board by $1.60.
Two proposals from NMPF and National All Jersey will be heard to update milk component factors.
Six proposals will be heard on Class III and IV pricing formulas. Three are separate proposals from NMPF, IDFA and Wisconsin Cheesemakers to update processor credits, known as ‘make allowances,’ as well as three from Select Milk Producers on butterfat recovery, farm to plant shrink and nonfat solids yield.
In addition, the hearing scope includes four proposals on how dairy commodity products are surveyed, including NMPF’s proposal to remove 500-lb barrel cheese from the weekly survey, AFBF’s proposal to add bulk 640-lb block cheese and unsalted bulk butter, while California Dairy Campaign’s proposal would add mozzarella.
Dairy farmers can testify in-person at any time during the hearing, or virtually on Fridays. Beginning Fri., Sept. 1 and for each Friday thereafter until the hearing concludes, dairy farmers may testify virtually in 15-minute time slots beginning at Noon ET. There will be 10 slots for virtual testimony each Friday.
To be included, farmers must pre-register. The pre-registration for each Friday’s time slots will be available starting Monday of the same week at the USDA Hearing Website. For example, the link to testify on Fri., Sept. 1 will be available on Mon., Aug. 28. To submit exhibits for the record, email them to FMMOHearing@usda.gov by 8:00 a.m. ET on the day of testimony.
Those participating in the hearing in person should notify a USDA official upon arrival at the hearing. For additional information, contact Erin Taylor, Director, Order Formulation and Enforcement Division, USDA/AMS/Dairy Program at Erin.Taylor@usda.gov.
AUTHOR’S NOTE: National Wildlife Refuge designations and land protection plans are long-simmering recipes, so it’s important to keep eyes on the pot while the heat is presumed to be turned down. Will a watched pot boil?One thing to keep in mind is to look overseas at the Netherlands, where the government, thrown this week into disarray to where the farmer-citizen party may gain strength, has been using climate-based targets to begin pushing buyout or closure of an estimated 3000 farms. Dutch farms have been zoned for a range of production-cuts from 15 to 90% with options to sell their land to the government. The Dutch farms identified for the largest production cuts of 75 to 90% would obviously be economically unsustainable and therefore more apt to sell. These are the farms that are located closest to EU Nature Preserves that were designated decades ago. When I spoke with a Dutch dairy farmer last year about this, he explained that the nature they have has been built, improved, by the farmers, but those close to the network of EU preserves are in the current crosshairs. Yes, these are long-simmering recipes. Here in the U.S., Northwest Pennsylvanians are being told it will take decades to complete a land protection plan if a French Creek National Wildlife Refuge is eventually designated for the watershed by the U.S. Fish and Wildlife Service Director. They are told that farming can continue, that they want to ‘help’ local conservancy efforts and that only willing sellers would be pursued. That’s not how it went when the Erie Refuge was completed at the center of the French Creek watershedin the 1970s. Some saw farmland fall to eminent domain two decades after that Refuge was established. Bottomline: Keep an eye on the pot, even if doing so draws accusations of claiming a tepid pot is about to boil. Every cook knows what happens when looking away. Here’s an update since the meeting between elected officials and the U.S. Fish and Wildlife Service.
MEADVILLE, Pa. – The U.S. Fish and Wildlife Service (USFWS) has “committed to a ‘pause’ and will draft a new proposal that could potentially limit the size and scope of a National Wildlife Refuge in the French Creek watershed,” according to a press release from Congressman Mike Kelly’s office.
Congressman Kelly and elected officials from affected counties met on July 6 at the Crawford County Courthouse in Meadville to discuss the proposed Refuge with USFWS representatives Vicki Muller, the project manager, and Mark Maghini, a realty chief.
This comes after the ‘public scoping’ phase where opposition and concerns were raised by farmers, members of Congress, county leaders, local residents, as well as questions about its necessity being raised by those involved in local land trusts and conservation efforts already operating in the watershed.
The ‘planned Refuge’ would create new federal ownership and oversight of lands in the watershed of nearly 800,000 acres along the 117-mile French Creek through portions of Crawford, Erie, Mercer and Venango counties, Pennsylvania and Chautauqua County, New York.
According to Congressman Kelly’s office, the USFWS acknowledged it did not properly engage and inform the communities of impact and will include elected officials in future planning.
“A pause on the proposed French Creek National Wildlife Refuge is absolutely necessary. Officials from the U.S. Fish and Wildlife Service have told us there is no official plan or size for this refuge, and I believe that’s exactly the problem — this has been a solution in search of a problem with farmers and landowners caught in the middle. The federal government does not need to have control of French Creek,” said Rep. Kelly in the statement.
“We all support a healthy and vibrant French Creek, but I believe local conservation efforts are already accomplishing what the USFWS is trying to do,” he noted.
Nothing to see here. Just go about your business…
Meanwhile, Maghini, the realty chief (land acquirer) for the Northeast region of the Fish and Wildlife Service indicated in an email to the Meadville Tribune that there is “no proposal,” pointing to a June 4 update at the special webpage for the project with these words highlighted in bold type.
He insists that the goal of the meetings and input-gathering this spring was to “identify whether there’s a role USFWS can play in the French Creek watershed.”
However, the agency’s own documents at the site show it already has a plan and has identified the next steps, which indicate it is already in the process of evaluating those public comments to develop a final proposal, which had a summer 2023 timeline.
Specifically, the “Schedule for Establishing the Proposed French Creek National Wildlife Refuge” on the second page of the May 9 FAQ document at the project webpage, is as follows:
1) Develop draft Land Protection Plan (LPP) and Environmental Assessment (EA) in the Spring of 2023;
2) Conduct public review and comment on proposal in the Spring of 2023; and
3) Evaluate the comments and develop the final plan for approval in the summer of 2023.
The customary procedure is for comments from the public scoping phase to be used when USFWS develops a land protection plan and environmental assessment. The ‘pause’ may extend this schedule to allow more time for the agency to evaluate the comments it received and to include elected officials in its planning.
Whenever a final plan is developed, the public then has 45 days to review and comment before it is ultimately left to the USFWS director, who has the sole authority to approve or disapprove a plan, according to the agency’s FAQ.
Residents tell Farmshine they hope a new draft provides more detail and a much smaller scope, but they also hope the ‘pause’ allows time for more public input on whether or not the Refuge designation is even needed.
The designation of the French Creek as 2022 River of the Year by Pennsylvania Organization for Watersheds and Rivers came largely due to the success of the existing local conservation efforts in promoting the health and biodiversity of French Creek in the first place, they say.
This brings the feeling that one can farm for generations, keep the working lands clean and natural, and then find out this can lead to being more, not less, vulnerable to having a Refuge designation with potential impacts for the future.
Pennsylvania Farm Bureau legislative director Nick Mobilia said as much to the Corry Journal: “I feel we have presented our issues with the refuge as positively as we can. We asked what USFWS thought was wrong with the waterway — they did not have any areas of concern.
“We as a local collective maintain French Creek and take pride in it — of course we are going to fight for it to be left as it is,” he said. “I think this was realized on (July 6) and (USFWS) will walk away from French Creek and focus on waterways that do need the government’s help.”
Will USFWS walk away? Doubtful.
Maghini, the USFWS realty chief for the region told the Meadville Tribune Friday (July 7) that the agency “looks forward to working with local officials once a plan that incorporates local feedback already collected has been prepared.”
Interestingly, the title of the FAQ document on the project webpage refers to the project as a “Proposal to Expand Refuge Lands in the French Creek Watershed.”
This reference to “expansion” is significant. At the center of the land protection plan “areas of interest” on the USFWS conceptual map (above) lies the already existing Erie National Wildlife Refuge (shaded pink within the green). Previously managed by Muller, the existing Erie National Refuge encompasses 8,777 acres of the 798,000-acre French Creek watershed.
At public meetings this spring, a farmer recalled his family’s farmlands eventually falling into eminent domain in the 1970s – more than a decade after private lands within what is today the Erie National Wildlife Refuge were originally designated by the USFWS in the late 1950s.
According to local newspaper accounts, Muller responded by telling the crowd that the USFWS “doesn’t do that anymore.”
The other significant aspect of ‘expanding’ an existing refuge vs. declaring a new one is that the Inflation Reduction Act provided climate resiliency and biodiversity funds for 2023 through 2026, including more than $121 million to the USFWS for restoration, rebuilding and expansion of existing wildlife refuges and $125 million for endangered species recovery.
The latter identifies 32 initial plant and animal species to be recovered “wherever found.” One, for example, is the snufflebox mussel with one area shown on its map as the French Creek watershed.
Will the public get more input? Will it help?
USFWS documents explain that when land protection plans are drafted and approved, they include land acquisition timelines that follow a “Landscape Conservation Design to ensure actions contribute to the landscape-level vision.”
Will a ‘pause’ give farmers, landowners and communities more say in the vision for their landscape, one they want to retain locally? Will the USFWS commitment to include elected officials in the planning happen before or after the new draft is presented?
Revamped ‘live text’ at the special webpage for the proposal notes that the USFWS review of public comments in April and May boil down to the following beliefs held by residents that USFWS says it agrees with:
1) Residents have a deep affection for French Creek;
2) They believe maintaining use of prime agricultural lands is important;
3) They value the rural character of the watershed and want to ensure its persistence; and
4) They value local land trusts within the community and trust them in their land protection efforts.
USFWS states further that a National Refuge designation is what authorizes the agency to pursue the land acquisitions from willing sellers and that it does not detail how USFWS would manage the lands it acquires through fee-title or easement.
USFWS also states that it does not fund local conservation efforts because it must show a dollar of federally-acquired land for every federal dollar it spends.
However, within this two-page “Proposal to Expand Refuge Lands,” the agency lists goals for “new refuge lands” (beyond the existing Erie National Refuge) that would allow the agency to “protect and manage the French Creek and its tributaries and wetlands.”
It also purports to “help” local conservancies by adding federal acquisitions to local acquisitions since none of these entities have access to unlimited funds. The only way it can “help” is to federally acquire land.
The U.S. Fish and Wildlife Service is a Bureau within the U.S. Department of Interior that operates in a quasi-independent fashion, having federal authority to establish and manage protected lands within its National Wildlife Refuge System, and to complete approved land protection plans over subsequent years, through its Land Acquisition and Realty division.
According to that division’s section of the USFWS website, funding for land acquisition comes from the Migratory Bird Conservation Fund through federal Duck Stamps and import duties on arms and ammunition as well as through the Land and Water Conservation Fund from offshore oil and gas leases.
In 2021, at the start of the Biden Administration, the USFWS updated its “Climate Adaptation Strategy” to be a framework that is part of the Administration’s “U.S. Climate Resilience Toolkit.”
Several documents available at the USFWS website explain that this toolkit has now equipped USFWS to “take immediate action to build ecosystem resilience in the face of climate challenges.”
As noted in the previous Farmshine articles, this is a process that moves at a snail’s pace — with or without a ‘pause.’
The ‘pause’ is expected to move the project from the front-burner to the back-burner — for now — amid the public heat surrounding it, but this doesn’t mean it is off the stove.
National Wildlife Refuge designations and land protection plans are long-simmering recipes, so it’s important to keep eyes on the pot while the heat is presumed to be turned down. Does a watched pot boil?
The stunner in the USDA FAS data is the U.S. imported 51% more Whole Milk Powder (WMP) in the January through May 2023 period vs. year ago. Looking at import volumes vs. All Milk prices, Fig. 1 shows the pattern: From 2008 to today, whenever there is a period of high farm milk prices, WMP imports increase, and farm milk prices fall. While cheese imports are down 3% YTD, non-cheese dairy exports are up 80% for a 9.2% total increase based on straight volume. Retired co-op executive Calvin Covington recently figured the January through April imports up 15% on a total solids basis. Graphic by Sherry Bunting compiled from USDA FAS and NASS data
— WMP and other imports accelerate, cow-less lab-protein analogs become ‘extenders,’
— Class I sales keep declining, fresh Italian cheese production down, inflation drives CPGs to reduce unit-sizes,
— RNG-driven dairy construction accelerates concentrated growth in cheese-heavy Central U.S.
By Sherry Bunting, Farmshine June 30, 2023
EAST EARL, Pa. — Current milk futures and dairy commodity markets have turned sharply lower and signal a rocky road ahead for farm level milk prices. Because of the lag times built into federal milk pricing, the most recent steep losses in spot cheese markets will hit the Class III price and create more Class I mover losses via the ‘average of’ method to hit milk checks in July, August and September.
Factors driving this include: declining Class I sales and fresh Italian cheese production, inflation-driven unit-size shrinkage, two months of reduced dairy exports and five months of increased dairy imports, and the advertising of cow-less lab-protein analogs as ‘extenders’ for food processing.
The May Milk Production Report confirmed that the Central U.S. is, indeed, “awash in milk.” Part two of this series will zoom into the geographic shifts in the concentration of milk growth, driven largely by Renewable Natural Gas digester projects for the California RNG gold rush. Much of the new dairy construction in the cheese-heavy Central U.S. is focused on manure to energy, not necessarily on milk and cheese to consumers.
The Production Report was released after the futures closed on June 21. In the next four trading sessions from June 22 through 27, Class III contracts for July through September lost $1.50 per cwt, on top of previous losses of more than $2.
By June 28, the expiring June Class III milk futures contract was at $14.92, and at $14.91 in the June USDA announced.
The ‘market’ has simply ignored USDA’s May 30 announcement that the government will bring in a ‘game changer’ to purchase 47 million pounds of cheese for food banks and schools as block and barrel cheese plunged to $1.31 and $1.39 per pound, respectively, by Tues., June 27.
USDA confirmed last week that the first round of its bid solicitations for the first phase of the 47 million pound cheese purchase won’t open until October. Bids and deliveries will come in stages from fourth quarter 2023 through mid-2024.
This means cheap milk will make cheap cheese, which could get even cheaper if inventories build in anticipation of selling that cheese at a tidy profit into the seasonal demand increases that begin in October, along with these announced government cheese purchases. (Who needs a make-allowance raise with this game in town?)
For the past several weeks, USDA Dairy Market News has been reporting spot loads of milk in the Central U.S. selling as much as $11 per cwt below the Class III price. DMN also reports milk from the Central U.S. growth region is moving farther to find a home. We are also hearing from readers about substantial milk being dumped in the Midwest, while a few independent dairies in Minnesota, one milking over 1000 cows, have been told by their creamery that their milk is not needed after schools close.
May milk production, nationwide, was up only 0.6% from a year ago. The 24 major monthly states were up by 0.8%. Milk cow numbers did not grow from April to May and are running just 13,000 head above year ago. This modest increase comes on the heels of no net gain in milk production for 2022.
All year, the monthly USDA World Ag Supply and Demand Estimates (WASDE) kept increasing the 2023 U.S. milk production forecasts, based on what it said are ‘more milk cows and less output per cow.’ The most recent WASDE walked that production forecast back a bit, but still expects U.S. dairies will milk an average of 9.415 million cows in 2023.
Then, somehow, the May Production Report pegged the number of milk cows on farms at 9.424 million head, even after the loss of 18,000 milk cows in a fire in west Texas in April. This is how tight the figuring has become on what we are told today is a surplus of milk and a lackluster demand.
The idea of a milk surplus that is big enough to drive these current price losses does not line up with USDA’s Jan. 1 cattle inventory report. So, in May, the WASDE began to walk it back, noting higher feed costs, reduced milk margins and higher beef cattle prices will slow the flow of milk.
Where are the cattle coming from? The Jan. 2023 inventory showed milk cow numbers were virtually unchanged from Jan. 2022 at 9.4 million head. The number of dairy heifers over 500 pounds was down 2% at 4.337 million head — the lowest number since 2006. Within that heifer number, expected calvings from Jan. 1, 2023 to Jan. 1, 2024 were also 2% lower than for Jan. 2022 to Jan. 2023. The next semi-annual cattle inventory report will be released in three weeks on July 21.
The Report’s smaller dairy replacement inventory is believable given the fact that offerings have been selling $300 to $500 per head above year ago levels, and the few weekly dairy cattle auctions throughout the U.S. have seen offerings down 30% below year ago… until June, when prices came under pressure on a suddenly increased offering at auctions over the past two weeks.
Meanwhile, dairy cow slaughter rates are also increasing, according to USDA, especially in the Midwest and Southwest, up 31 and 47% above year ago, respectively.
While the WASDE has forecast per-cow output to fall by 55 pounds per cow per month in 2023, the May Production Report pegged an 11-pound per-cow per month increase.
This means, it took just 13,000 more cows nationwide, and just 11 more pounds of milk output per cow per month to flip the switch to sharply lower milk prices based on – suddenly — too much milk? (Geographic concentration of milk growth plays into this equation, and we’ll discuss that in Part Two.)
In Part One, we look at the other supply and demand factors that are having a direct impact on where farm level milk prices are headed. These factors fill in the gaps left by the perplexing and contradictory sets of USDA dairy data.
I. Fresh fluid milk sales and fresh Italian cheese production both declined, pushing more available spring-flush milk into storable products.
Fluid milk sales January through April were down 2.8% from a year ago, and as bottlers slowed school packaging ahead of summer recess, the June 5th Dairy Products Report showed April production of fresh (made to order) Italian cheeses also declined 2.6% vs. year ago.
Meanwhile, butter production was down 4.9% while nonfat dry milk production increased just 1.9%, and skim milk powder production was down 22.4%. This put more of the available ‘spring flush’ milk into production of American cheese, up 2.3% vs. year ago in April, and the accompanying dry whey and whey protein concentrate production up 1.7 and 7.2%, respectively.
Record volumes of dry whey and cheese have been coming to the daily CME spot auction, driving down the spot prices that drive the National Dairy Product Sales Report prices that are then used in federal class and component pricing formulas.
II. Inflation pressures consumer demand, but inventories are not burdensome.
The May Cold Storage Report released on June 23 was a head-scratcher. Despite the ramped up American cheese production in the Dairy Products Report, the Cold Storage Report showed both the total amount of cheese in inventory, and the amount of American cheese in inventory, are both actually down 1% from a year ago at the end of May, while butter inventory was up 14% against last year’s higher-price-driving short supply.
Meanwhile, producers in the Midwest are being told that milk co-ops and buyers are facing cheese sales declines and that there’s not enough capacity to process all the milk now being produced in the region, with the existing capacity also experiencing labor and transport disruptions.
Dairy demand has stagnated, the analysts say, after months of high inflation. The May dairy consumer price index (CPI) was more bearish than the overall CPI. Dairy CPI was up 4.6%, with cheese up 3.6%, ice cream up 8% and other dairy products up 9.3% while whole milk decreased 3.4% and other non-whole milk increased 0.6%.
Inflationary pressure is driving some consumer packaged goods companies (CPGs) to trim unit-sizes for an appearance of stable consumer pricing. For example, we see unit-size shrinkage in cheese packages and slices. Not all American cheese slices today are 8 ounces, some are 6. Such moves effectively ration demand.
III. The stunner is dairy imports, up 9.2% with Whole Milk Powder imports up 51% year-to-date.
Looking at import volumes vs. All Milk prices, the pattern is clear (Fig.1). From 2008 to today, whenever there is a period of high farm milk prices, Whole Milk Powder (WMP) imports increase, and farm milk prices fall.
WMP is basically farm milk from another country, in bulk dried form, not a specialized product. It can be used in processing virtually any dairy product, containing all of the milk components — both fat and skim solids.
From December 2022 through April 2023, the U.S. imported the highest percentage of dairy production equivalent since 2016. And there is more milk equivalent comparison today than in 2016. The National Milk Producers Federation’s monthly market report confirmed this.
Then May imports worsened this trend.
Digging into the June 12 USDA Foreign Ag Service (FAS) Import Circular, the U.S. imported 80% more non-cheese dairy products from January through May vs. year ago. At the same time, cheese imports were down 3.3%. Combined, the total cheese and non-cheese imports were up 9.2% vs. year ago.
But the stunner in the data is the U.S. imported 51% more WMP in the January through May 2023 period vs. year ago.
It’s no wonder that the USDA Dairy Market News reported on June 15 that, “Dry whole milk processing (in the U.S.) is limited, despite hearty milk volumes.”
The report went on to say that even as seasonal milk output recedes “market contacts suggest dry WMP market tones may remain steady (at the current lower price levels) due to lighter demand.”
Not surprising, given the U.S. imported more WMP in May (550,000 kg) than for any month since April of 2020. WMP was imported at a record-setting pace during the pandemic while milk was being dumped in the U.S. and production-base-programs were tightened on U.S. dairy farms by milk cooperatives and buyers.
As the cumulative 2023 WMP imports accelerated in May, milk prices are set to take the sharp turn lower.
The year-to-date imports of butter, butterfat and butter oil are also well above year ago as part of that 80% increase in non-cheese imports January through May 2023 vs. year ago.
The June WASDE raised dairy import forecasts, yet again, especially on a fat basis, and it again lowered dairy export forecasts. The Report sees butter and nonfat dry milk (Class IV) continuing to sell stronger on better demand, while demand and prices for cheese and whey (Class III) are further reduced.
This combination reduced the WASDE forecast for the 2023 All Milk price to $19.95, down 55 cents from the May forecast. Part of this is the Class IV over III divergence that is substantially lowering the Class I fluid milk price under the ‘average of’ method, which took more than $1.00 off the advance Class I price mover for July, announced last week at $17.32. It would have been $18.34 using the previous ‘higher of’ method.
IV. Lab-created dairy protein analogs are advertised to processors as ‘extenders.’
Another emerging factor is the lab-created dairy protein analogs, which are the excrement of microorganisms that have been bioengineered with bovine DNA. These proteins are advertised in dairy food and manufacturing magazines as carbon-footprint-lowering, interchangeable ‘extenders’ for production of cheese, ice cream and other dairy foods.
The companies that are ramping up this fermentation-vat-lab-protein are doing limited consumer marketing. Mainly, they pursue a B2B model (business to business, not business to consumer) and try to capitalize on ESG scoring benefits based on who-knows-what-calculations that large processors are seeking as they navigate the investment, credit, and retail shelf-space ESG decisions up and down the supply chain.
No one knows how much lab-dairy-protein is being used at this time — or in what brands of dairy products — because these proteins do not have to be labeled, and they are not part of any dairy market or production report.
The Bioengineered Food Disclosure Law was passed by Congress in July 2016, and USDA established the national mandatory standard for disclosing foods that are, or may be, bioengineered in December of 2018. This Standard was implemented on Jan. 1, 2020 with mandatory compliance for all food manufacturers by Jan. 1, 2022.
According to USDA, the Standard defines bioengineered foods as “those that contain detectable genetic material that has been modified through certain lab techniques and cannot be created through conventional breeding or found in nature.”
The lab-dairy-protein-analogs are the harvested excrement of fermentation-vat-grown bioengineered yeast, fungi and bacteria, so BE labeling is not required due to the ‘detectable genetic material’ loophole. The modified genetic material is in the microorganisms, not their excrement.
PREVIEW – By Sherry Bunting, Farmshine, June 30, 2023
WATTSBURG, Pa. — Kevin and Amanda Bush are fourth generation dairy farmerswith their children Ava, 17, Clara, 6, Jarrett, 5, Georgia, 1, and 110 milk cows. On an early June day, unseasonably cold even for Erie County, Pennsylvania, a visit to the Bush Family Farm shed light on farmers’ concerns about a U.S. Fish and Wildlife Service proposal to designate 798,000 acres of French Creek watershed as a National Wildlife Refuge. Potential land acquisitions could begin a year from now if approved by the USFWS Director later this summer. Mark Muir from Erie County Farm Bureau, who raises hay and livestock, and Brian Young, whose extended family operates a nearby seventh generation farm were part of the discussion of the proposed protection area that would stretch 117 miles from Chautauqua County, New York south through Erie, Crawford, Mercer and Venango counties, Pennsylvania. The region is home to farms and other businesses that are the lifeblood of rural towns and counties. They use conservation practices and a lot of grazing and haying, with a vested interest and pride in their stewardship and relationships with existing conservation efforts.
On a map showing land protection ‘areas of interest,’ whole farms are included, not just setbacks (see map in main story below). This includes many dairy farms ranging from small herds managed by young next-generation farm families, like the Bushes, to larger farms with multiple generations of families involved. USFWS wants to purchase land or use permanent easements for whole farms. ‘You can still farm it,’ they say. But when specific questions were brought to an April meeting, the locals came away with very few answers. They anticipate another meeting in July.
Why are farmers concerned? They fear future use of eminent domain and farming restrictions as dominos start to fall. A National Refuge designation with Land Protection Plan, is perpetual. They fear the loss of rented ground to feed their cows. They worry about their towns and counties. They want to know the minimum goals of the project so they can have an intelligent conversation with USFWS. They have asked for scientific studies to be shared that show how the freshwater mussel population and other aquatic life are actually doing today vs. 10, 20, 30 years ago.
It feels like the start of what could become a gradual 30 x 30 land grab. Surely, if this was happening in agricultural communities of southeastern Pennsylvania along the Susquehanna River in the Chesapeake Bay watershed, instead of northwestern Pennsylvania in the French Creek watershed, there would be much more attention paid. See main story below as published in July 7, 2023 Farmshine, and stay tuned as we follow this developing story.
They say National Refuge for mussels will move at snail’s pace, but farmers see muddied water ahead
MAIN STORY – By Sherry Bunting, Farmshine, July 7, 2023
WATTSBURG, Pa. — The rural French Creek watershed is in the sights of the U.S. Fish and Wildlife Service for a proposed National Wildlife Refuge that could span nearly 800,000 acres, stretching 117 miles from the headwaters in Chautauqua County, New York across the Pennsylvania border through Erie, Crawford, Venango and Mercer counties.
Meetings this spring in Meadville and Edinboro were part of the ‘public scoping’ phase. They were packed with citizens and fraught with questions, deep concern and objections.
An initial public comment period ended May 19.
From the Southwest corner of New York through the Northwest corner of Pennsylvania, the French Creek river and watershed runs through rural communities where farming is the lifeblood. If this potential land-grab were happening in southeastern Pennsylvania in the Chesapeake Bay watershed, more attention would be paid to the concerns of the farmers and communities.
Vicki Muller, the proposed Refuge’s project manager, told local television station FOX-66 that the U.S. Fish and Wildlife Service (USFWS) is “looking to protect and preserve more wildlife habitat within the French Creek watershed, so this plan is just the beginning stages of that.”
Mentioned were freshwater mussel species, said to be the only populations east of the Mississippi, along with several species of fish, wetlands, and migratory waterfowl.
Land acquisitions are about a year away, Muller confirmed.
Farmers and other community members, along with managers of existing conservation efforts, say federal land acquisition is not necessary to meet environmental goals because those who are living, working, farming in the region already work with local conservationists to manage the land in ways that have been recognized for success.
French Creek was named Pennsylvania’s “River of the Year” in 2022.
Opponents of the Refuge argue that its designation could place federal regulation on private landowners for perpetuity. They say an accompanying Land Protection Plan (LPP) could take properties and money off local tax rolls, move land ownership away from local residents, and take products generated on the farmland away from local communities, weakening the region’s economy and food security.
To top it off, USFWS could offer no evidence that this would improve — at all — the status of French Creek and its aquatic life, nor any evidence that either are in trouble.
USFWS is currently in the process of reviewing public comments and stakeholder feedback and is developing a final plan for approval by the USFWS Director later this summer, according to a Q&A document at the webpage devoted specifically to the French Creek proposal at https://www.fws.gov/project/evaluating-new-refuge-lands-french-creek-watershed.
A June 4 ‘Public Scoping Recap’ is also provided at this webpage, stating the proposal is not yet an official proposal because it is still in the ‘public scope and biological environmental assessment’ phase.
The webpage indicates that the framework would be built after they get the buy-in, after they get the National Refuge designation and LPP approved, and after they complete the biological environmental assessment. That’s when officials say they can answer the probing questions of locals about environmental and land acquisition goals.
Isn’t that putting the cart before the horse?
One of the strategies being used here is to protract the conversation and soothe public concern with assurances that the Refuge to save mussels will move at a snail’s pace.
Essentially USWFS is looking to designate land now for decades of acquisition and that it will answer specific questions as the process moves forward working collaboratively to refine the plan after the designation and plan are approved.
Such circular talk makes farmers and landowners skeptical, uneasy.
Within the “land protection areas of interest” on the ambitious map, there are both small and larger farms, many of them dairy farms as well as beef cattle, crop and produce growers.
“I started looking at the map, and I see I am an area of interest. Everything I own is an area of interest,” said Mark Troyer, a potato, corn and wheat grower, in an on-camera interview during the Edinboro meeting. “I think we can work and live hand-in-hand (with wildlife) and have been doing a great effort. We’ve already been doing a great job.”
Concerns about eminent domain were specifically raised. Muller stated this will not happen.
Landowners are not convinced. They want to know the endgame.
They want to know what happens once there is an approved LPP with specified land acquisition timelines. What happens to their farms if they are eventually surrounded by acquired land? What happens to the farms outside of the areas of interest that will find themselves next to a National Refuge? What is the ultimate land acquisition goal?
What are the actual environmental goals, and why does the federal government need to acquire the land to meet those undisclosed goals, instead of supporting existing local conservation efforts that show measurable success?
They share the concern that once the designation and LPP are approved, this could take on a life of its own… forever.
A pristine view across the road from the Bush Family Farm. Behind the trees is French Creek. The Bushes wonder why land acquisitions are needed. Farms throughout the watershed do a good job. They wonder what will happen to their farm if there are willing sellers up and down the road from them…
According to the USFWS Q&A, the land protection plan will take decades to complete as the number of willing sellers and the availability of funding will determine the timeline.
With that in mind, U.S. Congressmen Mike Kelly (R-Pa.) and Nick Langworthy (R-N.Y.), whose congressional districts cover the “areas of interest” in the draft proposal, along with U.S. House Ag Committee Chairman Glenn ‘G.T.’ Thompson (R-Pa.), led a letter calling on the USFWS to reconsider federal designations on private land.
In the letter, the members of Congress recognize that a healthy, vibrant ecosystem along French Creek must continue to be protected, but also that local farmers and residents are better suited than Washington bureaucrats hundreds of miles away to dictate how this land is best protected.
Mark Muir with the Erie County Farm Bureau grows hay and raises livestock in the area. He has been involved in the meetings, asking questions at the front end of this proposal.
Farmshine met in June with Muir at the Bush Family Farm outside of Wattsburg in Erie County. He was joined by Kevin and Amanda Bush as well as Brian Young, whose extended family operates a nearby 7th generation farm.
The Bush farm has been in the family since 1939. French Creek borders it, surrounded by grasses across the road from the dairy barn and hillside grazing paddocks. The Bushes also rent crop ground in the watershed.
They and others are concerned that once a final plan is developed and approved later this summer, land acquisitions from willing sellers could eventually morph into a land-grab that won’t stop until all of the “areas of interest” are federally owned or controlled by the USFWS.
The designation of the land as a National Wildlife Refuge and the approval of an LPP would be the first concrete steps.
“We are told there is nothing set in concrete yet,” says Muir, “But we had many questions they couldn’t answer at the meetings. We tried to talk to them about farm BMPs (best management practices), but they didn’t understand the concept.”
Because the USFWS is still in the ‘public scoping, comment review and final development’ phase,’ officials won’t engage in land use questions or what-if scenarios. They don’t answer questions that help farmers understand the ultimate impact because they say that completion of the Refuge would be “decades away.”
“Decades away” is really tomorrow for most farmers who continually look ahead at their operations and land use, making plans for future generations.
Mark Muir (right) and Brian Young stand across the road from Bush Family Farm by a section of French Creek that runs parallel. This is just one small part of what could be a massive target for federal land acquisitions and easements if the watershed is designated a National Refuge.
“At the end of the day,” says Young, “Fish and Wildlife can target any wildlife and the ecosystem areas that an environmental assessment deems necessary. They are not like the BLM or NRCS. The USFWS is comparatively small and does not have the cross-correlation to agriculture.”
Furthermore, land acquisitions are funded by duck stamp sales, land access fees, and other sources of revenue that make USFWS less reliant on tax dollars to use their authority. In other words, Congressional oversight — from an appropriations standpoint — is lacking.
If a final plan and Refuge designation are approved, the gradual creep of land acquisitions would begin, giving USFWS oversight of current working lands that could affect the fate of farming in the region, in particular dairy and beef cattle.
Without data and without answers, this becomes “a slippery slope with no guard rails,” says Muir. “We want to be objective about it, and to have those conversations at a July meeting. We need certain information to have a meaningful conversation so we can see if and where we might be able to work together.”
Meanwhile, Kevin and Amanda and their four children milk 110 cows and raise their youngstock. They are a small family dairy on land that the Bush family has been farming for 85 years.
There is not only a legacy here, but also progress as they have implemented many BMPs, just as other farms have throughout the region.
Muir notes that NRCS funding, and other cost-shares, don’t seem to flow as much in the Northwest direction of the state.
He says BMPs on farms could improve even more with cost-sharing and a productive dialog, which is preferable to a multi-decade federal plan to acquire the land.
“If this is supposed to be to save the freshwater mussels, and they have these dollars to spend, why not try other approaches first?” Amanda wonders, adding that they could promote BMPs that farms can do even better than what they are already doing, and cost-share some of that. “It would go a lot farther instead of designating a Refuge, buying up land, and disrupting family farms, local towns and their economies.”
“We do no-till and minimum tillage here. We do cover crops wherever we can, and we are working now already with the County Conservation District,” Kevin adds.
Bottom line, these and other young farmers want to continue farming and producing food for their communities. They are part of these rural communities where cows and crops, grazing and haymaking, youth programs and showing at the county fair are part of the fabric.
Maybe it’s more important to identify the rural community fabric that is at stake — the younger generations who want to continue. As farm families of all sizes, they are accustomed to working with USDA, NRCS, county conservation districts, local conservation efforts that all have connections to agriculture, so they speak the same language.
But when Fish and Wildlife makes its entrance with a draft proposal for a National Refuge of immense proportions across so many miles, acres and counties — having no crossties to agriculture — that’s a scary place for any farm family to be, and it can lay threadbare the fabric of the communities beyond the farms.
To be continued
AUTHOR’S NOTE: A USFWS National Refuge designation and Land Protection Plan includes acquisition timelines and a “Landscape Conservation Design” to “ensure actions contribute to the landscape-level vision,” according to USFWS documents. USFWS is a Bureau within the Department of Interior and operates in a quasi-independent fashion, having federal administrative authority to establish and manage such refuges and complete them over time with its own sources of funding. In 2021, at the start of the new Administration, the USFWS updated its “Climate Adaptation Strategy” to be a framework that is part of the Administration’s “U.S. Climate Resilience Toolkit,” equipping USFWS to “take immediate action to build ecosystem resilience in the face of climate challenges.” (One thing to keep in mind is to look overseas at the Netherlands, where the climate-based land-grab is in full swing. Farms have been ordered to cut from 15 to 90% of their production or sell their farms to the government. The farms identified for 75 to 90% production cuts to be economically unsustainable are those that are closest to the EU Nature Preserves designated decades ago.)
Ag Moos 