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, D.C. – The U.S. Senate confirmed Brooke Rollins 72-28 on February 13th as the 33rd Secretary of Agriculture, and the second woman to lead the USDA. On Friday, Feb. 14, she was sworn in and addressed a gathering of over 400.
Rollins pledged to bring greater efficiency to the USDA to better serve farmers, ranchers and the agricultural community.
“We welcome the DOGE efforts because its work makes us better, stronger, faster and more efficient,” said Rollins of the review of USDA already underway by the Department of Government Efficiency (DOGE), headed by Elon Musk.
She announced an end to identity politics, pledging equal dignity.
Rollins also said the USDA will be “returned to its basic purpose,” with a focus on its core missions of supporting American farming, ranching, and forestry.
In a Feb. 14 news release, Rollins noted that the DOGE review continues to be comprehensive and announced the first tranche in a series of reforms.
USDA is currently reviewing more than 1000 contracts for possible termination. The department has already terminated 78 contracts, which totaled more than $132 million. Some of these contracts were proposed procurements that were discontinued before they went into effect, according to the news release.
The news release gave 10 examples of terminated contracts, which totaled just $4.21 million. Ending Politico subscriptions at $2.77 million, represented the bulk of the money in the examples. Other items listed ranged $30,00 to $300,000, such as Diversity, Equity and Inclusion (DEI) ‘onboarding’ specialist, Diversity Dialogue Workshops, a Brazilian Forest and Gender Consultant, a Women and Forest Carbon Initiative Mentorship Program, an international training and education for women to increase their participation in climate change adaptation, and a Central American Gender Assessment Consultant.
Rollins also rescinded all DEI programs, including 948 employee trainings focused on DEI, Environmental Justice, and gender ideology.
The Department is pursuing an aggressive plan to “optimize its workforce by eliminating positions that are no longer necessary, bringing its workforce back to the office, and relocating employees out of the National Capital region into our nation’s heartland to allow our rural communities to flourish,” she said.
On her second (Feb. 15), Rollins met with farmers at the Championship Tractor Pull in Kentucky, then traveled to southwest Kansas Monday (Feb. 17) to tour dairy and beef operations and have a producer roundtable with Senator Roger Marshall, M.D., prime sponsor of the Whole Milk for Healthy Kids Act in the U.S. Senate.
Reform of the Dietary Guidelines was mentioned in a tweet from these discussions, something Secretary Rollins will work on jointly with HHS Secretary Robert F. Kennedy Jr., also confirmed Feb. 13 in a narrow Senate vote.
At the Top Producer Summit in Kansas City, Mo., Tuesday, Feb. 18, Rollins addressed expanding trade access and cutting regulatory red tape for farmers. She also announced looking toward federal policy to prevent China from buying U.S. farmland.
USDA Secretary Rollins was also appointed this week by the Trump Administration to work together with National Economic Council Director Kevin Hassett — collaborating with scientists and global experts — to spearhead a new avian influenza strategy that moves away from mass euthanization of infected poultry flocks to prioritize enhanced biosecurity measures and medication to control spread.
Brooke Rollins — now on Feb. 13, 2025 confirmed as the next Secretary of Agriculture and the second woman ever to lead the USDA — stands to be sworn in for testimony during her confirmation hearing before the U.S. Senate Ag Committee back on Jan. 23. She was joined by a room full of family, friends, colleagues, her high school Ag teacher, fellow 1990-91 state FFA officers, the little league softball team she coaches, and a pastor from Georgia who prayed with her and her family that morning. Senate Agwebsite livestream screen capture by Sherry Bunting
Rollins pledged ‘fast and furious’ first 100 days.
By Sherry Bunting, Farmshine, Jan. 24, 2025
WASHINGTON, D.C. — The growing U.S. Agriculture trade deficit was a key topic when on Jan. 23, President Trump’s nominee for Secretary of Agriculture, Brooke Rollins, gave testimony and answered four hours of questions before the U.S. Senate Committee on Agriculture, Nutrition and Forestry.
(UPDATE: Rollins was confirmed by the full Senate on Feb. 13, 2025)
Along with the trade deficit, Senators were keen to talk about Trump’s trade policies and tariffs, while also asking questions that covered everything from immigration and the ag workforce, to biofuels, the farm bill, SNAP, WIC, and other feeding programs, as well as revitalization of rural communities and preparing the next generation.
Rollins even had an important exchange with Senator Roger Marshall, a medical doctor from Kansas, about bringing the choice of whole milk back to schools. (See related story here.)
Both Texas Senators John Cornyn and Ted Cruz introduced Rollins, calling her nomination “a no-brainer.”
She grew up in the small agricultural town of Glen Rose, Texas, where she was a barrel racer, a state FFA officer, helped make hay on the ranch, and raised and showed cattle in 4-H. She also spent some summers on the farm of extended family in Minnesota.
An admitted “policy wonk,” she earned her Ag Leadership and Development degree at Texas A&M and her Law degree, with honors, at the University of Texas School of Law.
“Everyone who knows Brooke, loves Brooke, and I know you will too as you get to know her,” said Sen. Cornyn.
Sen. Cruz highlighted her proven leadership, “profound appreciation for the challenges and rewards of life in agriculture,” reputation as an “independent policy thinker” and as a person who can “bring people together to accomplish major policy objectives.”
In her opening testimony, Rollins acknowledged that farmers and ranchers are currently facing “extraordinary challenges.”
She credited her FFA years for putting her on a course for where she is today and said it would be her great honor to “serve the men and women, who daily without pause or complaint provide our great nation and the world with the best food, fiber and fuel. It is clear farmers and ranchers are the cornerstone of our communities, and I will do everything in my ability to make sure (they) thrive.”
When asked to describe her first 100-days, she used the words “fast and furious,” especially in delivering into the hands of farmers and ranchers the disaster and economic relief recently passed by Congress.
On biofuels, she noted the President included year-round E15 fuels in his energy emergency proclamation.
Pressed for hope on the current $45 billion U.S. Ag trade deficit. Rollins said a key priority will be to expand access to export markets.
“We are vision-boarding to hit the ground running to bring that trade deficit down. It is up 42% in the last year,” she said. “Agriculture is in a tough spot right now in moving our products out. The USMCA is up for renegotiation, and other trade agreements.”
Rollins stressed that she will be working with Congress to be sure the White House and partners across agencies have what they need “to work across the world to bring in new trade partners to expand access to new markets.”
At the same time, she addressed questions about the Trump tariff agenda, saying “This is no surprise. He believes it is a tool to bring America back to the forefront of the world. He also understands the potential devastating impact to farmers and ranchers. I have spoken with Sonny Perdue on how that was managed in the first term for something similar, to close any potential temporary holes.”
Keenly aware that farmers “want trade not aid,” that they want to “grow markets not government payments,” Rollins said: “President Trump is a consummate deal maker. I believe that his skill and intense focus is on making deals for his people, not only for America, but for the Ag community that supported him at 90%. He knows that these are the people who have been with him the longest.”
Rollins served in the last Trump White House in key domestic policy roles. She is well versed in how Trump’s inter-agency process works, how discussions are handled, what the oval office meetings look like, and says she “will ensure our Agriculture community is strongly represented at that table.”
She gave the example of working with the incoming Labor Secretary, if confirmed, on the immigration and ag workforce needs, and asked the Senate to quickly confirm nominated undersecretaries to get the ball rolling.
Several Senators said they see Rollins, if confirmed, bringing this “value add” to the Ag cabinet position as someone who has been with the President for nine years. She knows how his White House process works and pledges to make sure “farmers will be at that table” with her job making sure “Agriculture is front and center where decisions are made.”
From trade and immigration to land management and regulation and from nutrition and hunger to preparing agriculture’s next generation, Rollins was clear: “We will follow the data, and we will listen to our farmers and ranchers as this is moving forward. We as leaders, as Agriculture, we will work together to understand and solve for these problems.”
Rollins cited these immediate priorities if confirmed as Ag Secretary:
— Ensuring disaster and economic relief that was passed by Congress at the end of 2024 is deployed quickly into the hands of farmers and ranchers;
— Working with the men and women of USDA and state leaders on animal disease outbreaks such as H5N1 in poultry and dairy cattle;
— Dedicating timely technical assistance to ensure a modernized farm bill moves forward that meets the needs of farmers and ranchers;
— Modernizing, restructuring, and re-aligning the U.S. Department of Agriculture;
— Supporting rural development to ensure rural communities are equipped and benefit from development of strong markets, including export markets;
— Eliminating burdensome and costly regulations;
— Preparing the next generation in agriculture; and
— Ensuring efficient nutrition programs for a healthy next generation.
Editorial Analysis: Tumultuous 2024 spills over into 2025 – Part Three
By Sherry Bunting, Farmshine, February 7, 2025(updated with additional information after print edition published)
EAST EARL, Pa. – A tumultuous dairy and beef market in 2024 is bound to be even more so in 2025. The long-awaited Jan. 1 Cattle Inventory Report is in, and we all saw the kerfuffle about tariffs and trade this week.
The bottom lines are…
— The U.S. beef cow herd continues to shrink, while both the beef and dairy heifer replacement numbers are notably smaller, signaling less domestic beef production and stable, if not reduced milk production in the face of strong domestic demand for beef and dairy products.
— U.S. import volumes of live feeder cattle as well as beef and dairy products have climbed over the past five years.
— Uncertainty prevails about U.S. trade policy, but export volumes of beef and dairy have leveled off already in the past several years. Dairy exports are bound to get a boost in the short-term as U.S. prices are mostly trailing current global prices. Tariffs on Canada and Mexico and potential retaliations are paused.
— Will the dairy herd continue maintaining itself at these shrinking heifer ratios now that we are five years out from the time of plentiful heifers.
Report highlights include…
Milk cow inventory has remained relatively stable over the past five years, ranging from 9.34 million head on Jan. 1, 2020 to the 5-year high of 9.45 million head on Jan. 1, 2021, then back down to just shy of 9.35 million head on Jan. 1, 2024 and Jan. 1, 2025. However, the number of dairy replacement heifers has dropped by 16% over the past five years from 4.61 million head on Jan. 1, 2020 to 3.91 million head on Jan. 1, 2025. This number is down almost 20% — or nearly 1 million head — from the record high 4.81 million dairy replacement heifers recorded on Jan. 1, 2016.
Are milk cows milking longer? Is the average dairy cow getting 16 to 20% more productive life (an additional half lactation)? Is the age at first calving continuing to decline, and are herd culling rates also declining significantly enough to maintain the current cowherd size on 16 to 20% fewer heifers expected to calve vs. 5 and 10 years ago?
According to the Jan. 1, 2025 Cattle Inventory Report, there are not quite 27 heifers expected to calve this year for every 100 cows in the current U.S. dairy herd, and a national cull rate of 29% based on January through December 2024 dairy cow slaughter totals. Five years ago, there were just over 31 heifers expected to calve for every 100 milk cows in the similarly-sized U.S. dairy herd.
Will these trends collide at the 5-year mark this year, given the average productive life of a dairy cow based on the most recent data (2020) is not quite three lactations or roughly 5 years of age? How will the $5 to $10 billion in new processing capacity be filled, or will we see existing plant closures in their stead? Are the investor dairies that put up 10, 20, and 30,000 cow facilities each year filling new barns with milking animals raised on their own calf ranches coming in under the reporting-radar of USDA NASS? Or is the pace of dairies exiting the business on one end mirroring the growth on the other end?
One inescapable conclusion is that the milk cow herd remains relatively stable, while the dairy replacement heifer numbers have shrunk by 16% vs. five years ago and by 20% vs. 10 years ago, and the record-high prices paid for dairy replacements is proof of tight supplies.
This is part three in a four-part series. Part one was published Jan. 3, 2025; Part two on Jan. 17, 2025.
CME graph using USDA NASS Inventory data
U.S. cattle herd down… again
U.S. total cattle numbers on Jan. 1, 2025 are down 1% year-over-year (YOY), according to the All Cattle and Calf Inventory Report released by USDA on Fri., Jan. 31st.
At 86.66 million, the report counted 500,000 fewer head than last year’s total, which was already the smallest in 74 years (Jan. 1, 1951).
The total number of all cows and heifers that calved is down 0.4% YOY at 37.21 million head. That is 147,000 fewer beef and dairy cows on farms as compared with the revised-lower totals a year ago, which were already the smallest in 84 years (Jan. 1, 1941).
The total number of all heifers over 500 pounds on Jan. 1, 2025 (including heifers destined to become beef) was down 1% YOY at 18.18 million head. That’s 140,000 fewer head counted than on Jan. 1, 2024, which was already the smallest total heifer number in 34 years (Jan. 1, 1991).
In the Jan. 1, 2025 report, USDA NASS revised-lower its Jan. 1, 2024 and July 1, 2023 estimates of total animals that had calved, as well as the calf crop in those 12 to 18 month prior Inventory Reports. Statisticians went back and compared the prior estimates to the official slaughter data, the import and export data, and the relationship of this new survey information to the prior surveys.
This means the Jan. 1, 2025 numbers are now estimated at levels below the revised-lower prior reports that had already set records! (A mid-year 2024 inventory would have been helpful, but was canceled by former Ag Secretary Tom Vilsack, claiming insufficient USDA funds).
Chart compiled by S. Bunting with USDA NASS Inventory data
Milk cows flat, heifers shrink
The number of milk cows on Jan. 1, 2025 was essentially unchanged vs. year earlier, up only 2,500 to just shy of 9.35 million head.
However, the dairy replacement heifer total is down 1% YOY at 3.91 million head. At this rate, the number of heifers heading to careers as milk cows is 16% below the 5-year comparison on Jan. 1, 2020.
At 3.91 million head, there are 37,000 fewer dairy replacement heifers than a year ago, which was already the smallest number of dairy replacement heifers in 47 years (Jan. 1, 1978).
As the graph above illustrates, milk cow numbers have held relatively stable over the past five years, while the number of dairy replacement heifers has significantly declined. Are cows experiencing longer productive life? Or are the multi-site investor dairies filling their own expansion sites via their own calf ranches, and escaping the USDA reporting radar?
According to the most recent data (2020), average dairy cow productive life in the U.S. is just shy of three lactations, roughly five years of age. With the number of dairy replacement heifers declining 16% over the past five years, will these two trends collide in the next 12 to 24 months to reduce the U.S. milking herd while escalating the already record high dairy replacement cattle prices? And, what role might HPAI H5N1 play as longer term impacts emerge?
USDA NASS reports that the average auction value of ‘average’ milking cows has increased by nearly $800 per head to $2650 for 2024 vs. $1890 for 2023; $1100 per head higher vs. the $1720 average for 2022; and double (+$1300) the average value reported at $1350 and $1300 per head four and five years ago for 2021 and 2020, respectively.
The average cost to raise dairy replacements has been estimated at $1700 to $2400 per head, which means the value of ‘average’ replacement heifers at $1720 to $2660 from 2022 to 2024 is finally starting to mirror the cost to raise them — on average.
Many dairy producers continue producing only the heifers they need, which is reducing the availability of heifers in the marketplace for those wanting to expand.
Producers continue to respond to the lure of the 3-day-old dairy-on-beef crossbred calves offering substantial margins of $800 to $1000 per head — with no investment, no rearing, no revenue-wait, and no risk.
Basically, a dairy cow can produce $800 to $1000 in revenue for the dairy as soon as she drops a live crossbred calf, no matter what the milk price or margins are doing, and with her whole lactation in front of her.
The Jan. 1 Inventory Report shows the U.S. beef herd continues to shrink, suggesting beef-on-dairy crossbreds will continue to offer bigger per-head margins than growing extra dairy heifers to sell as herd replacements — unless they are premium dairy heifers.
Expanding dairies are having to really plan ahead to raise the animals they need for growth or scramble to get them. Additional upward price momentum may be seen on dairy replacements in the next 12 to 24 months as the more abundant heifers available five years ago ‘age-out’ of the system, statistically speaking, at five years old, which is the industry average age of a milking cow in the U.S.
With the Jan. 1, 2025 U.S. milking herd holding steady at a level that is 1.1% smaller than it was in 2021, the expanding dairies are buying up the herds of the exiting dairies at high prices that make dairy farmers think about selling the cows and hanging on to the heifers, for now, if they do not have a next generation to continue the dairy.
Turnover of existing Holstein herds to include other breeds is also occurring, along with genetic improvement within the Holstein breed, as producers work to raise heifers that calve into the milking herd at younger ages, produce more component yield per hundredweight of milk, have improved productive life traits and fewer days open for a tighter average calving interval.
With a 2024 national dairy herd of 9.35 million milk cows and a 2024 national dairy cow slaughter of 2.726 million, the national culling rate last year was 29%. At that rate, even if the average age at first calving is 22-months, the U.S. dairy industry would need 28 dairy heifers to calve successfully in the next 12 months for every 100 milk cows — just to maintain the current size of the U.S. dairy herd.
According to the Jan. 1 Inventory Report, there are 2.5 million dairy heifers expected to calve in 2025 (down 0.4% or -9000 head). This calculates to 27 (actually 26.75) dairy replacement heifers expected to calve in 2025 for every 100 cows in the U.S. dairy herd as of Jan. 1st.
In 2016, when dairy replacement heifer numbers reached their peak at 4.81 million head, 3.11 million head were expected to calve that year, and the total U.S. dairy cow inventory was 9.31 million head, meaning there were 31 heifers expected to calve for every 100 cows in 2016. This has steadily eroded in part because dairy producers have stopped spending the money to grow extra heifers that were worth less than the cost to grow them until this year. They also worked to reduce age at first-calving, days open across the herd, higher component levels in the milk, reduced death loss, longevity, and began gradually re-introducing beef crossbreeding, which has become a pretty big deal over the past five years.
Some parts of the country are down significantly in heifer replacements as of Jan. 1, 2025, while others are up. For example, Pennsylvania has 15% more dairy replacement heifers on farms vs. year ago.
These estimates indicate milk production will be flat to lower for the next 12 to 24 months.
What this does not account for is the increasing milk component levels generating more dairy products per 100 pounds of milk and the increasing volume of dairy imports, particularly cheese, butter, and whole milk powder. But those increases can only do so much in the face of $5 to $10 billion in new processing assets coming online in the next 6 to 18 months.
CME graph using USDA NASS Inventory data shows continued overall contraction of total cattle inventory as new cycles mostly fail to breach prior cycle ceilings, floors, and midpoints.
Beef herd shrinks more
The Jan. 1 Inventory shows the U.S. beef herd continues to shrink. At the national level, there are no signs of rebuilding, as the total number of heifers heading to careers as beef mama cows is down 1% YOY. However, in some parts of the country, such as Virginia, more heifers were retained as beef cow replacements and fewer were earmarked for feedlots.
At 4.67 million head, there are 46,000 fewer beef replacement heifers in the U.S. vs. year ago, setting another record low as the smallest number since 1948.
Even more striking is the beef replacement heifers that are expected to calve in 2025 are down a whopping 2% YOY (-50,000) nationally.
Meanwhile, the beef-on-dairy feedlot placements, while a growing segment of the beef industry, are not enough to reverse the downward beef production trend as evidenced by declines in the number of animals over 500 pounds on Jan. 1st heading to feedlots: Steers and bulls are both down 1% (-157,000 and -21,000 head YOY, respectively). Heifers over 500 pounds heading to feedlots are down 0.6%, and the number of cattle on feed as of Jan. 1, 2025 is down 1% YOY at 14.3 million head (-130,000 head).
The Inventory Report came on the heels of the January Cattle on Feed Report, which showed 3% fewer feedlot placements as of Jan. 1, perhaps because of the Mexican border closure to the live cattle imports, due to concerns about transmission of the screw-worm parasite.
Even the total number of all calves (heifers, bulls and steers) weighing under 500 pounds dropped 1% lower YOY at 13.46 million head (-30,000).
These estimates suggest domestic beef production will decline for at least the next 12 to 24 months, maybe longer.
What this does not account for are the number of live cattle crossing the border into U.S. feedlots from Mexico and Canada and the increasing amounts of beef the U.S. imports from other countries, including from Canada, Mexico and South America.
Map compiled by S. Bunting with USDA NASS Inventory data
Significant geographic dairy shifts
Breaking the dairy inventory numbers apart, we see big geographic shifts.
The West added 78,000 more milk cows in 2024 vs. 2023, except for California’s numbers being unchanged. On the other hand, the East and Upper Midwest had equal or fewer milk cows, down collectively more than 75,000 head YOY, except Michigan was up just 1000 head.
The biggest 2024 gains were tallied in Texas, up 35,000 head, and Idaho, up 17,000 head. Colorado grew by 8,000 head; Iowa, Kansas and South Dakota by 5,000 each; and Oklahoma by 2,000.
The biggest milk cow declines were in Minnesota and New Mexico, down by 10,000 head each; Oregon down by 9,000; Arizona by 8,000. Wisconsin, Ohio, and Nebraska by 5,000 each; Missouri by 4,000; Florida and Georgia by 3,000 each; Illinois, Kentucky, and Washington by 2,000 each; and Tennessee by 1,000. Smaller unranked states collectively accounted for the remainder of milk cow losses.
Interestingly, USDA pulled three Top-24 Milk Production States into the ‘Other States’ category, choosing not to report their cow and heifer numbers for proprietary reasons. They are Indiana (#16), Vermont (#18) and Utah (#20). Thus the ‘Other States’ category saw an increase of 195,000 cows simply because these three Top-24 states were included anonymously in the total.
The geographic breakdown is interesting when it comes to dairy replacement heifers as the growth is noted in the areas where the cow numbers have declined and vice versa. These shifts could reflect changes in the way heifers have tended to move across state lines for rearing, especially in light of the dairy-adapted B3.13 strain of HPAI H5N1.
Pennsylvania is the biggest outlier as the cow numbers are unchanged YOY, but farmers reported 30,000 more dairy heifers in the Commonwealth on Jan. 1, 2025 vs. year ago.
Elsewhere in the East, Virginia dairy heifer replacements are up 2,000 head; Tennessee up 1,000 head; New York and Kentucky unchanged; Georgia and Florida down 5,000 head each. Again, the ranked states of Indiana, Vermont and Utah had their replacement heifer numbers lumped into the ‘Other States’ category, which consequently showed a gain of 7,000 heifers vs. year earlier when those states were not included in that category.
Beef replacement heifers and feedlot heifers are down a combined 10,000 head in Pennsylvania, while Virginia showed signs of beef herd rebuilding, reporting 4,000 more beef replacement heifers and 4,000 fewer heifers heading to feedyards.
Looking at the Mideast, Michigan had 5,000 more dairy heifer replacements, while Indiana’s numbers were unreported. Ohio is down in dairy heifers by 5,000 head. Beef replacement heifers in that region are up by 7,000 head and feedlot heifers are up by 3,000 head.
The Upper Midwest grew their dairy replacement heifer numbers, while the West significantly decreased them. Wisconsin is up by 10,000 head YOY; while Minnesota and South Dakota grew by 5,000 head each.
In the West, the following states with significant growth in milk cow numbers had significant losses in dairy replacement heifer numbers: Kansas down a whopping 35,000 head in dairy replacement heifers; Idaho down by 30,000 head; Texas, Pacific Northwest and Iowa down 10,000 each. Dairies in Kansas, Idaho, Texas, and Iowa contended with avian influenza in 2024.
Meanwhile, in California, New Mexico, and Colorado (all three having dealt with H5N1) the number of dairy replacement heifers was reported as unchanged YOY, but Arizona, which has not had H5N1, grew its dairy heifer numbers by 10,000 head.
USDA Economic Research Service graph
Trade is uncertain(Imports up, Exports leveling off)
Dairy and beef imports are growing, and the industry is responding to ‘tariff talk’ with statements showing fear of trade wars harming farmers or possibly gaining concessions in the context of Agriculture’s current annual trade deficit of $45.5 billion.
On Friday, Jan. 31, the spot cheese and Class III milk futures markets plunged lower in response to U.S. tariff announcements of 25% on goods from Canada and Mexico and 10% on goods from China.
This fear was short-lived, however, because the planned tariffs on goods from Canada and Mexico were promptly paused three days later on Monday, Feb. 3, when leaders agreed to support and combine efforts on U.S. border security, while putting teams together with the pledge to work through U.S. trade issues over the next 30 days.
The announced 10% tariffs on China went into effect Feb. 4, but discussions between the U.S. and China are said to be resuming for phase one of the trade deal struck in the prior Trump Administration just before the Covid pandemic hit globally.
Meanwhile, the total volume (not value) of dairy exports has leveled off on a total solids basis in the past two to three years as the U.S. exports more cheese and less skim milk powder and much less whey – the latter because we domestically produced less commodity SMP and far less commodity dry whey in 2024. Inventories are down for both, meaning domestic demand is using what is produced.
On the flip-side, the U.S. imported more cheese, butterfat, and whole milk powder during the first 11 months of 2024 YOY.
We will take a closer look at the trends in U.S. dairy farm numbers, production, and trade after final 2024 trade and production data are released in late February, and with more information, perhaps, on how U.S. agricultural trade policy may be shaping up for 2025.
Whole milk, new farm bill top their bipartisan to-do list
By Sherry Bunting, Farmshine, Jan. 17, 2025
HARRISBURG, Pa. – Bipartisan priorities were evident — especially on getting whole milk back in schools and completing a new farm bill — during Rep. Glenn ‘GT’ Thompson’s annual listening session on opening day of the Pennsylvania Farm Show Jan. 4th in Harrisburg.
With a thin Republican House majority, Thompson, who represents the largely rural 15th district of north central Pennsylvania, will continue as Chairman of the Ag Committee.
He introduced the more than 100 attendees to the Ag Committee’s new top Democrat, Ranking Member Angie Craig, who represents the mostly rural 2nd district of southeast Minnesota.
They were joined by Ag Committee and Ag Appropriations Committee member, Rep. Chellie Pingree, representing the 1st district of Maine, and by Pennsylvania Secretary of Agriculture Russell Redding.
Whole milk
“We got really close to getting this done,” said Thompson about his Whole Milk for Healthy Kids Act after Berks County dairy farmer Nelson Troutman with the Grassroots Pennsylvania Dairy Advisory Committee asked: What’s next for the bill in the new 2025-26 Congress?
“We have to start over, but there is a lot more support this time,” Thompson replied. He doesn’t see any obstacles on the House side after overwhelming bipartisan support in the 2023 floor vote.
He expects the bill to move quickly through the Education and Workforce Committee under its new Chairman Tim Walberg (R-Mich.), a whole milk bill cosponsor. Then Thompson will work with House leadership to get it on the calendar for a 2025 vote.
He said the Senate side also looks “very promising” as Sen. John Boozman (R-Ark), a supporter of the bill, replaces former Ag Committee Chair Debbie Stabenow (D-Mich.) who had blocked it.
Craig gave further assurance. She and the new Ag Committee Ranking Member on the Senate side, Amy Klobuchar (D-Minn.), are working together on this. “We do not see what we saw last time on the Democratic side to get this done for GT,” said Craig.
Both are Democrats from Minnesota who previously cosponsored the bill – Craig on the House side, Klobuchar on the Senate side.
Thompson credited the education and leadership of the Grassroots Pennsylvania Dairy Advisory Committee and 97 Milk in raising awareness and support. “The grassroots effort also helped improve the bill by suggesting language that makes sure the calories don’t count toward the fat in the school meal,” he said.
Pingree is also a big supporter of whole milk in schools. She was “amazed” to see all the Drink Whole Milk signs, banners, and painted bales while visiting her brother-in-law in Lancaster County, Pennsylvania.
“I don’t know too many states where you see something this interesting while you’re driving down the road. It’s pretty impressive. It has spread far and wide,” she noted.
Congresswoman Chellie Pingree (D-Maine) was “impressed” by the Drink Whole Milk signs along roadsides when she spent time in Lancaster County, Pennsylvania. That was music to the ears of Berks County dairy farmer Nelson Troutman with the Grassroots Pennsylvania Dairy Advisory Committee. His original painted round bales in December 2018 motivated the launch of the 97 Milk education movement in February 2019. It is run by volunteers and donations at 97milk.com
ESL milk
Troutman asked if the bill could address extended shelf life (ESL) milk in schools. He is concerned about taste and acceptance by students, saying “schools should only be allowed to serve ESL milk if that’s the only option available to them.”
His concern arises from the volume of new plant capacity coming online across the country for ESL and aseptic shelf-stable milk packaging, along with new Federal Milk Marketing Order formulas that will price Class I milk differently based on shelf life. This creates potential competitive issues, especially in Pennsylvania, for bottlers of conventionally pasteurized milk that tends to be more local vying for school contracts with ESL milk coming from potentially more distant locations.
Farm-to-School
State lawmakers and young people in attendance voiced further concerns about the quality of school meals and the practice of schools shipping-in prepackaged meals prepared out-of-state, leaving Pennsylvania agriculture out of the loop.
They requested incentives for local farm-to-school food programs. Frank Stoltzfus, a 9th generation farmer from Lancaster County pointed to the PA Beef to PA Schools program as a successful example.
These discussions come under the jurisdiction of the House Education and Workforce Committee and its “long overdue overhaul,” said Thompson: “The Childhood Nutrition Reauthorization is where we reform and refine to update school meals. I’ll be encouraging Chairman Walberg that we do that reauthorization, and this (ESL question) is something we can certainly take a look at.”
Pingree noted “some farm bill funding also goes to school meals, and we can put more into resupplying kitchens for on-site meal prep and local procurement.”
Nutrition overhaul
The last time Congress did a Childhood Nutrition Reauthorization was in 2010, when it tied school meals more strictly to the Dietary Guidelines for Americans (DGAs).
“When it comes to nutrition, if kids won’t eat it, then it’s not nutritional, and we are seeing a lot of waste today,” Thompson observed.
On that score, he pointed to “good reforms” to the Dietary Guidelines process that will again be part of the markup of the farm bill to “take some of the food politics out of the process coming from the so-called ‘experts.’ We want science-based not agenda-based guidelines.”
Farm bill
Asked about a timeline for the new farm bill, Thompson was optimistic. New committees are still being populated, and new members will need some farm bill education.
“But I would love to see this farm bill go to committee markup in the first quarter of this year — that is my goal – and then see it move quickly to the floor,” he said in a Farmshine interview after the event. “We will continue to do listening sessions, but I want to move ahead. We’ve had great input from all across the country, but I do think it’s important that we keep listening and touching base.”
Both he and Craig shared concerns about nosediving grain prices and net farm income. They differed on what constitutes cuts vs. cost-control on the Supplemental Nutrition Assistance Program (SNAP) that makes up the bulk of the now over $1 trillion farm bill. They both want the Inflation Reduction Act (IRA) funds pulled into the conservation title and baseline, but they differ on removing the IRA’s climate mandates for these funds.
Thompson warned about competition from conservatives who are interested in using these funds as ‘pay-fors’ on tax policy, which he said Ag Committee Republicans would oppose. “I want these IRA funds in this farm bill,” he said.
Craig said the IRA funds best practices like carbon sequestration, and Pingree said she likes the focus on resilience for healthy soils. They pointed to carbon markets that see the value and lauded Sec. Vilsack’s use of $3 billion in CCC funds for pilot projects that will “help give us better metrics.”
While there is general agreement that most practices on farms improve the planet, the question is – how do the things farmers already do get monetized?
“They are not getting enough credit for their ecosystem services — carbon sequestration, air quality, water quality, filtration of rain. Farmers improve our environment just by farming,” said former State Senator Mike Brubaker. “Is there some way for them to get paid?”
SUSTAINS Act
Thompson said the farm bill does not address this specifically, but legislation passed in 2022 includes the SUSTAINS Act, which he described as “providing a framework for private industry to be involved.”
Corporations and foundations can donate funds to USDA for conservation purposes, like improving technical assistance for more farmers to have access to popular programs like EQIP. He cited a “great return on investment” from Chesapeake Bay Foundation initiatives as an example.
But he pushed back on the Ag Secretary’s use of CCC funds for such purposes because administrations come and go, with their own changing priorities.
“Having certainty going forward is incredibly important,” he said. “Sec. Vilsack wanted to do things by regulation and his interpretation of how CCC funds could be used. He should have come to us (Congress), instead.”
Likewise, concerns were voiced about emerging land use policies at local, county, state and federal levels.
Renewable energy
Asked for their views on traditional and alternative energy, a bipartisan preference emerged for balancing affordable and renewable sources with science, technology and innovation as “pathways for solutions.”
“We need ‘all of the above’ because energy will be a mix for a very long time,” said Pingree. “But we have to stay in this (renewable) dialog.”
Thompson said the ultimate destination of the Farm Show butter sculpture — a digester on a Pennsylvania dairy farm — is a good example of renewable energy produced from cow manure and food waste.
Craig said biofuels through E15 standards are vital for corn and soybean farmers in her district of Minnesota, with new biobased aviation fuel standards an exciting opportunity that U.S. farmers should benefit from, not imported corn from Brazil.
“Our farmers have to be at the forefront of it, we have to get this right,” said Craig. “As Ranking Member, I’ve got to manage my caucus just like GT does as Chairman, to work together for the right solutions, which are probably somewhere in the middle.”
Food security
Questions were also raised about invasive species, animal health, and safeguarding the food supply — especially in regard to inspection of border crossings for invasive pests that threaten all types of agriculture and novel cross-species migration of highly pathogenic avian influenza (HPAI H5N1) in poultry and now dairy operations.
“We have to make sure we keep investing in our laboratories, inspections, and research,” said Thompson.
According to Redding, the Pennsylvania Diagnostic Laboratories System (PADLS) was born out of the poultry industry’s first difficult encounter with avian influenza back in the early 1980s. Today PADLS is instrumental as the state is one of the first to enter the mandatory national bulk milk testing strategy, and has established some protocols credited to the poultry industry.
He stressed the importance of cross-species engagement between Pennsylvania’s top two ag sectors of poultry and dairy, where biosecurity is essential.
“We’re at about 100% of milk representing our nearly 5000 dairy farms, and we’ve not found (H5N1) on the third cycle of testing now,” Redding reported. “The difficulty with a national strategy is finding a model that fits the diversity of all the states.”
Craig said HPAI is a big concern for her home state of Minnesota, which is No. 1 in turkey production and No. 7 in dairy.
They look forward to working with the new U.S. Secretary of Agriculture on what the national strategy looks like going forward “without overburdening the farmers.”
Brooke Rollins, photo courtesy America First Policy Institute
Bringing whole milk choice back to schools could align with Rollins’ and Kennedy’s priorities
By Sherry Bunting, Farmshine, November 29, 2024
WASHINGTON, D.C. – President Elect Donald Trump has nominated Brooke Rollins of Fort Worth, Texas to be the 33rd U.S. Secretary of Agriculture. She would be the second woman to serve in the top USDA post, the first being Ann Veneman in 2001 under President George W. Bush.
Trump’s announcement Saturday, Nov. 23 brought ripples of surprise across ag media outlets after many had floated a long list of other names under consideration.
In the end, it came down to Rollins, a lawyer and trusted advisor who previously served on Trump’s 2016 Economic Advisory Council as well as Director of Domestic Policy Council and Assistant to the President for Strategic Initiatives in Trump’s first term.
Rollins has spent the past four years as founder and CEO of the America First Policy Institute (AFPI). Trump highlighted her commitment to American farmers, food self-sufficiency, and rural small-town restoration.
The AFPI has not had much to say on agriculture, specifically, but has advocated for a ban on China’s ownership of American farmland. Rollins also spoke out against any sort of carbon or methane tax in a 2018 Texas Public Policy Foundation broadcast.
“As our next Secretary of Agriculture, Brooke will spearhead the effort to protect American farmers who are truly the backbone of our country,” Trump stated.
Raised with a generational ranching background in the small town of Glen Rose, Texas, Rollins was involved in 4-H and FFA leadership and credits her high school ag teacher for “changing her life.”
She earned her B.S. in agriculture development at Texas A&M and spent her public policy career in nonprofit and governmental leadership at the state and federal levels.
She and her husband Mark have four teenage children, who avidly show cattle.
While searches for paper or interview trails on her agriculture policy positions come up mostly empty, what can be gleaned is that Rollins has the President-Elect’s ear and a penchant for analyzing issues with an ear to those affected, not just the ‘experts.’
In a post on X (formerly twitter), Rollins thanked Trump for “the opportunity to serve… It will be the honor of my life to fight for America’s farmers and our Nation’s agricultural communities. This is big stuff for a small-town ag girl from Glen Rose, Texas… Who’s ready to Make Agriculture Great Again?”
Ag and dairy organizations responded. Several took the opportunity to also weigh-in on Trump’s nomination of Robert F. Kennedy Jr. a week earlier for Secretary of Health and Human Services with the Make America Healthy Again agenda.
The two departments jointly issue the Dietary Guidelines for Americans (DGAs) every five years, which USDA uses to regulate meals (and milk) served at schools, daycares, and senior centers. A large chunk of USDA’s massive budget and staff administer and regulate nutrition programs.
The next cycle of DGAs is already in process with the two new USDA and HHS secretaries tasked with finalizing the 2025-30 DGAs by the end of next year that will set the rules for schools and other nutrition programs for years to come.
American Dairy Coalition CEO Laurie Fischer observed in a statement that the incoming secretaries will have the opportunity “to fix food nutrition policy, such as a long overdue reform of the Dietary Guidelines that govern school meals where children have been prohibited from choosing whole milk and 2% milk since 2010.”
Grassroots Pennsylvania Dairy Advisory Committee chairman Bernie Morrissey also expressed hope that Rollins and Kennedy, if confirmed by the Senate, will work together to bring the choice of whole milk back to schools.
“For far too long, America’s children have been deprived of the choice of delicious, nutrient-dense whole milk. USDA requires schools to only offer fat-free and 1% low-fat milk. Many children throw that milk away, so they are missing nature’s nutrition powerhouse. Now, more than ever, we need to offer the “good stuff,’” Morrissey stated, adding that “Rollins is a mother, and that helps. We have mothers on our committee and they really get it.”
He explained that his committee includes dairy farmers, allied industry representation, a recently retired internal medicine doctor, school nurse, school foodservice director, and former school board director who have worked on this issue over more than a decade. He wants the incoming secretaries to understand the problem so they can unwind the decades of worsening low-fat rules that pave the way for more ultra-processing leaving children with less nutrient-dense choices and unfavorable nutrition and health outcomes.
“We look forward to working with the next Administration on reforms that allow dairy farmers to market the whole milk they produce and allow children the opportunity to choose milk they will love,” Morrissey added. “Our friends at the 97 Milk organization are doing a wonderful job educating the public. Now, we just need real leaders willing to stand up and roll back the federal ban on whole milk in schools. We are eager to help Make America Healthy Again and Make Agriculture Great Again.”
The International Dairy Foods Association (IDFA) has conducted surveys showing the vast majority of parents want their kids to have the choice of whole milk at school.
In his response to the Rollins and Kennedy nominations, IDFA CEO Michael Dykes, DVM also highlighted the joint nutrition roles of USDA and HHS, citing the need to “enhance the diet quality of Americans, protect the integrity of food production and processing, and establish a regulatory environment that drives innovation and efficiency… to continue leading the world in the production of high-quality dairy nutrition.”
In a follow up interview with ADC, Fischer said dairy labeling integrity is another big issue for dairy farmers in the wheelhouse of both USDA and HHS. “We hope to see the restoration of labeling integrity in the dairy case when it comes to plant-based lookalikes that don’t even come close to real dairy’s nutrition. That includes the regulation and clear labeling of these novel bioengineered fake ‘dairy’ and ‘meat’ lab-created proteins.”
More broadly, she cited the need for real world application of sound farmer-led policy and innovation that meet the realities farmers face daily.
“ADC looks forward to working with the next Secretary on ways to reduce redundancies and wasteful spending to improve efficiency so more of the dollars intended to support farms get to the actual farmers. We are encouraged by Rollins’ history with the Office of American Innovation in Trump’s first term because our farmers are key innovators and lifelong stewards of natural resources,” she said.
As of Nov. 26, National Milk Producers Federation (NMPF) had not yet released a public statement to the media on the nominations of either Rollins or Kennedy, stating simply in a social media post on X: “Congratulations to Brooke Rollins on her nomination to become the next USDA Secretary. Dairy farmers are ready to hit the ground running in 2025!”
National Cattlemen’s Beef Association VP of government affairs, Ethan Lane touted Rollins’ “history of fighting for Main Street and Rural America. America’s cattle producers need a secretary of agriculture who will protect family farms and ranches, roll back crushing regulations, and stand up for rural values.”
American Farm Bureau president Zippy Duvall weighed in, noting the “good relationship” Rollins has with the Texas Farm Bureau: “We hope to build on that. We’re encouraged by her statement that she’d ‘fight for America’s farmers and our nation’s agricultural communities.’ Effective leadership at USDA is more important than ever as farmers and ranchers face a struggling agricultural economy.”
Trump’s cabinet nominations are now complete and require confirmation by the U.S. Senate.
Check out some other interesting perspectives on the next USDA Secretary, pending Senate confirmation.
HARRISBURG, Pa. – Innovation on the dairy farm isn’t just the big investments that come to mind, but a mix of changes and a mindset to improve. Three distinctly different Pennsylvania dairy farms were showcased in a producer panel during the 2024 Dairy Financial and Risk Management Conference hosted by the Center for Dairy Excellence recently.
The audience of mainly ag lenders and industry representatives along with some fellow dairy farmers, had the opportunity to see how producers think through the challenges, progress, and investments, and how they manage their risk in areas such as herd health, feed and nutrition, as well as adversities they can’t control like weather, markets, and labor.
Automation at Oakleigh
For Matt Brake of Oakleigh Farm, Mercersburg, the five-year plan was accelerated in a different direction after a barn fire in December of 2019 forced the family to ask the question whether they would even continue in dairy. No animals were lost, and the 1950s parlor was saved, but they had big decisions to make about the future without a facility.
“We did a lot of praying and had a lot of difficult conversations,” he recalls.
By July 2020, they were milking 120 registered Holsteins with two Lely robots, automated feeding, automated bedding, and retained their preference for a bedded pack barn rebuilt within the existing footprint.
“We really appreciate the cow comfort we get from a bedded pack, and the longevity, which is something we are really seeing now, more than ever,” Brake explains.
They didn’t know — at first – that they would go robotic, but they did know the Lely Vector feeding system would be used for feeding in place of buying a new tractor and mixer and firing it up twice a day.
“It’s amazing to see how all these different pieces of technology play together,” says Brake.
The curtains and fans are all automated and integrated. All data points for the herd are displayed on every single milking. The system ranks cows from zero to 100 on percentage chance of illness, and the automatic sorting for individual attention is based on things like activity, rumination, production, and intakes.
“Everything just plays together in real time, without guessing. We’re still involved as managers, but the data and automation are the tools we didn’t have before. We saw an increase in production, but farming is still farming,” Brake relates, giving examples of ration changes that had to be made with a forage quality issue, and how data systems helped with early detection.
Overall, the animals are doing better in this system, and they are treating fewer cows because they are getting to them earlier.
“It’s really true that an ounce of protection is better than a pound of cure. The quicker we can give those cows the attention, the less likely they are to really nosedive on us,” he says.
Brake sees how automation saves labor in some respects, but it’s more accurate to say that, “With automation, we are better utilizing our skills. We’re able to spend our time better with the cows or focusing on priorities – like chopping corn or getting the alfalfa harvested at the right time.
“We don’t have to stop those activities two times a day or worry about if we have enough help in the parlor, and do we trust that person to stand in the parlor. The robot might ‘call in sick’ temporarily here and there, but in general, compared with some of the employees we’ve had, it’s reliable.”
Moving from just the paper DHIA to incorporating this into the electronic records, changes how they manage culling to be more voluntary than involuntary.
“We can look at space and overcrowding and begin to evaluate cows not just on milk but how efficient they are in the robots looking at deviation from the average with rankings on everything from performance in the robot to reproductive performance and past treatments and other metrics,” he explains.
Better management of the culling decisions also gives them the ability to plan how many heifers to raise. “One of the things we are doing is using more beef semen and using the system to decide who to use it on,” he says.
Renovation at Mount Rock
For Alan Waybright, innovation was the focus when he purchased Mount Rock Dairy from the Mains five years ago near Newville.
A building project was in order to update the over 30-year-old milking systems. About a year ago, they began milking in a 50-stall rotary, which changed the milking time on 2.5 times a day with each milking in a double-12 taking 9 hours, to now milking 4 times a day with each milking taking 3 hours and 45 minutes.
Waybright has been expanding from the 650 cows and 150 bred heifers he brought to Mount Rock from his prior home farm involvement at Mason Dixon, to milking 940 cows today with a 92-pound average, 4.2F and 3.3P.
Automation features were part of the rotary to reduce labor, and the calf barns include the wet barn to get them started before grouping for automatic feeders where they receive four to five feedings a day, resulting in healthier, better growing calves.
With the automated pre- and post-dipper, Waybright says the milking procedure in the DeLaval 50-stall rotary is very consistent, requiring just two employees, the first to wipe and forestrip and the second to dry and attach.
“This is a labor savings, yes, but there have been other benefits for udder health too,” Waybright reports. “When we went from the double-12 where we were hand dipping to the sprayer, a 50-gallon drum used to last seven days, now it’s three days.”
One of the innovative things he has worked on is the use of manure solids for bedding while keeping somatic cell counts low. His system uses two screw-presses dropping manure into the drum, leaving about two days’ worth of bedding at the other end with moisture levels around 50%.
They bed stalls every day during the week to use the solids as they come right out of the separator drum, adding acidifying ag lime to control mastitis.
Diversity key at Slate Ridge
“For us the secret weapon is diversity,” says Ben Peckman of Slate Ridge Dairy, Thomasville. He and his wife and high-school aged children milk 150 cows and raise 100 heifers, also feeding out all bull calves as steers.
He says there’s not one multi-million-dollar investment here, just the things that altogether add up to make a large impact.
At the dairy, he looks for ways to streamline, like ovsynch for repro. “It’s the little pieces here and there, he says, mentioning the machine with a smart phone app he purchased to do daily dry matter analysis on feedstuffs before mixing.
“Instead of always looking at the past for those adjustments, I can go out and see what the DM is right now,” says Peckman.
He fills the small sampler with three samples to get an average. “I have feed charts on my phone, pop in that number, and it changes out what I put in the mixer to get the same DM pounds,” he explains.
With feed stored in drive over piles, this is even more important to get the accurate measures each day, according to Peckman, who sees how it changes daily, firsthand.
“On a rainy day, it goes up, and on a dry, hot day, it goes down,” he says. “When changes happen day to day, testing every two weeks is not enough. My spreadsheet smooths out the changes by using the average of the past three days. When we started doing this we saw better production and components.”
A robotic feed pusher is another feed technology that’s made a difference. “We see higher intakes, fresher feed, labor savings and the ability to do this when I’m not there,” Peckman relates.
Bankers asked what ‘calculus’ goes into making such investments. For Peckman, the answer was blunt. “It’s something that improves how my herd performs but the robotic pusher does something I’m not willing to do. I’m not getting out of bed at 2:30 a.m. to push up feed.”
Other barn updates include ventilation controls and ceiling fans above bed pack areas. It’s better for cow comfort but there’s also a cost savings. “We use half as much straw and bedding with the new fans drying the air.”
His wife’s mobile milk pasteurizer is another innovation. They always fed whole milk and had a few problems when they fed it unpasteurized.
With the mobile pasteurizer, it’s two-fold: “the milk is better, but also the temperature is much better. It keeps the milk warmer, and we have healthier, better growing calves.”
Peckman really enjoys the cropping side, farming 1100 acres of diversified crops to feed the cowherd and take advantage of other markets.
“Diversity is how I mitigate risk. It’s my key technology. Diversity can’t be bought, but it pays. It helps me combat weather, combat markets, and combat other adversities in general,” he says, adding that it’s “not rocket science,” just looking at things other farmers are doing and adapting.
He does use GPS guidance for his tractors for planting and spraying, which saves seed and inputs and work off field monitoring with yield maps.
In addition to traditional corn for grain and silage and alfalfa haylage, they grows high oleic soybeans at Slate Ridge Dairy. “We saw a drastic increase in butterfat percentage,” Peckman reports.
On his silage ground, small grains are grown — triticale, wheat, and barley. The barley he harvests after it gets the head, two weeks before it would be a grain harvest, as silage for feeding heifers.
One “big new innovation” he’s excited about is male sterile forage sorghum.
“It puts a head on without developing grain in the head,” Peckman explains. “This allows the plant to concentrate on putting energy into a plant that is a high sugar crop not a high starch crop. It’s very comparable to corn silage. I take a pound of corn silage out of the ration and put a pound of this stuff right in.”
He has replaced up to 40% of his corn silage with this particular sorghum silage and would like to get to 50% because “it’s a very economical feed to grow, the seed is cheap and inputs are less. It’s working well for me, but you have to have a way to harvest it as the BMR forage sorghums don’t ‘stand’ all the way to harvest.
“We started feeding this two years ago, and our components are up.”
Another newer crop in Peckman’s diversified portfolio is milo, or grain sorghum. He says it’s economical to grow and drought resistant, and they have a market for bird seed.
The wheat is grown as a cash crop but it has been fed too. The barley he harvests is a supplement for dry corn, depending on the year. He likes to grow these crops because they make good straw to bed the cows.
Peckman is a big believer in keeping his soil covered at all times, so some of the decisions and rotations are tweaked with weather and calendar. Over the past couple years, he has added a few acres of sunflowers to the crop rotations.
“We can double crop sunflowers after wheat, and there is a viable bird seed market for those,” he says.
“Mainly, they are beautiful, and I see people enjoying them. Nobody is paying me for that part of it, but it warms my heart to see neighbors stopping with the families, taking pictures and looking at my flowers. With everything going on in the world today, if I can see someone go out and smile a little, it’s worth it.”
AUTHOR’S NOTE: Who’s the wizard behind the curtain on USDA’s last-minute milk pricing surprise, the splitting of the Class I baby to favor ESL? Vilsack, of course, with a little help from his checkoff cronies at Midwest Dairy and DMI — masquerading as ‘dairy farmers.’
By Sherry Bunting
USDA’s recommended decision on Federal Milk Marketing Order Class I (fluid milk) formulas brought a big surprise getting very little attention. That surprise: “splitting the Class I baby” and adding what constitutes a “fifth Class” of milk — TWO Class I movers announced each month.
ZERO proposals to divide Class I into a two-mover system were aired at the national hearing. Even USDA’s analysis shows the two movers would differ by as much as $1 apart — or more — in any given month.
The hearing record is woefully inadequate, indeed completely void of testimony for a second Class I mover. No proposal. No evidence. No testimony. No analysis. No parameters. No definition.
What does this surprise two-mover decision mean?
Fresh, conventionally processed (HTST) milk would go back to being priced by the prior method, using the higher of the Class III or IV advance pricing factors to determine the Class I skim milk base price portion of the mover.
On the other hand, milk used to make extended shelf life (ESL) fluid milk products, defined only as “good for 60 days or more,” would continue to be priced using the average of these two pricing factors, plus-or-minus a rolling adjuster of the difference between the higher-of and average-of for 24 months, with a 12-month lag.
Confused yet?
The industry is calling this surprise two-mover twist ‘innovative’ and ‘creative’, even ‘brilliant.’ But let’s hold the horses a moment.
With two movers, fluid milk costs could be different for plants in the same location based on shelf life. Could processors change the label to move between the movers and pay whichever mover was lower? Who knows? There is no clear definition for the new class, and the parameters to qualify are non-existent.
ESL processors will know the rolling adjuster 12 months in advance, due to the “lag.” They will know the two advance-priced movers a month in advance. They will have it charted in an algorithm no doubt, and make decisions accordingly.
Dairy farmers, on the other hand, will find out how their milk was used and priced two weeks after all their milk for the month was trucked off the farm. If the two-price Class I system becomes law, dairy producers’ milk checks will be even less transparent than they are now!
Not only does the USDA hearing record and decision fail to clearly define ESL, the industry doesn’t even have an exact and generally-accepted definition or standard for ESL.
ESL is both a loose and specific term.
Generally speaking, ESL is a term covering a broad range of products — ranging from UHT (ultra high temperature) or ultra pasteurization, aseptic packaging, to the inclusion of a process that combines microfiltration, skim separation, and indirect heating (in stages). These processes yield what is more specifically referred to as ESL fresh milk with a longer shelf life in refrigeration, but is not shelf-stable.
What’s at the root here?
Dairy checkoff personnel have openly identified ESL — especially shelf stable aseptically packaged milk — as its “new milk beverage platform.” Dairy farmers’ promotion funds are being used to research and promote ESL milk, as well as studying and showing how consumers can be “taught” to accept it.
For the past few years, the four research centers supported by the checkoff have been drilling into milk’s elements to sift, sort, and test different combinations to reinvent milk as new beverages.
In 2023, North Carolina State researcher Dr. MaryAnne Drake —speaking at the 2023 Georgia Dairy Conference — talked about this “new milk beverage platform. We are after a shelf-stable milk that tastes great and meets our consumer’s sensory needs and our industry’s sustainability needs,” she said.
Bingo. Dairy checkoff funds for ESL are being driven by the net-zero sustainability targets. And now USDA’s federal milk order changes are proposing to lower dairy farmers’ Class I income and/or competitively favor, and in a way subsidize, ESL processors over fresh HTST fluid milk processors. Follow the money.
Dr. Michael Dykes of IDFA, at the Georgia Dairy Conference in January 2024, told dairy producers that “this is the direction we (processors) are moving… to get to some economies of scale and bring margin back to the business.” He said the planned new fluid milk processing capacity investments are largely ultra-filtered, aseptic, and ESL — 10 of the 11 new fluid plants on the IDFA map he displayed are ESL. Some will also make ultrafiltered milk and plant-based beverages too.
The linchpin to regional dairy systems and markets for milk from farms that fit USDA’s description of small businesses is the processing of fresh, conventionally pasteurized (HTST) fluid milk.
Meanwhile, dairy checkoff overseers, in cahoots with processors, are making big bets that consumers will embrace the obvious conversion underway to the consolidating shelf stable ESL milk, emboldened by the average-of pricing that has failed farmers miserably over the past five years and is now part of the proposed two-price Class I system mysteriously added to the USDA recommended decision when a two-price Class I system was never noticed as part of the hearing scope.
In the recommended decision, USDA notes that ESL currently represents 8 to 10% of total fluid milk sales but does not present the full picture of how the industry began aggressively converting to ESL since 2019 when Class I average-of was implemented. More of these accelerated investments will become operational in 2024-26.
Before we know it, the industry will have converted to ESL, and dairy farmers will once again experience disorderly marketing, depooling, and the basis risk of the mysterious average-of mover.
Dairy farmers have seen this movie before.
In 2018, the average-of method — which changed how the Class I base was calculated — was portrayed by National Milk and the IDFA as “revenue neutral.” But at the recent national milk order hearing, testimony revealed that farmers experienced Class I revenue losses totaling nearly $1.25 billion from May 2019 through July 2024… and other impacts.
Disorderly markets via the ‘average-of’ continue to result in losses and disrupt performance of risk management tools that fail to protect farmers against the intervals of extreme basis risk.
Proponents say the proposed rolling 36-to-13-month ESL adjuster on the second mover in USDA’s decision provides compensation to farmers for the difference between average-of and higher-of. However, that occurs gradually — over time — with a lagged interval. If tight milk supplies boost commodity prices and drive up all classes of milk, then dairy farmers’ incomes will at least partially lag years behind real-time markets!
ESL processors like Nestle and fairlife testified that the average-of method over the past five years allowed them to use Class III and IV hedges on the CME to offer flat 9- to-12-month pricing to wholesale customers and increase their sales. Nice to know the big corporations made money on that inequitable Class I pricing system.
Would a two-mover system ultimately reduce farmers’ access to milk markets in some regions and diminish the food security of those consumers? Watch the impact of a new, unregulated ESL plant now being built in Idaho!
Many legitimate questions lack answers
Milk is commonly prized as the freshest, least processed, most regionally local food at the supermarket. Will the USDA recommended decision accelerate consolidation and a reduction in fresh fluid milk availability for consumers?
Has USDA considered the purpose of the FMMO system is to promote orderly marketing and the adequate supply of fresh fluid milk? Will consumers accept the taste of the not-so-fresh ESL, or migrate faster to other beverages if fresh fluid milk is less available to them?
How will the two-mover system impact dairy farms located outside of the industry’s very specific identified growth centers?
Will this perpetuate the wide divergence between Classes III and IV that has been an issue since 2019, further punishing dairy farmers with disorderly marketing and opportunistic depooling?
Who knows? The hearing failed to define, examine, or obtain evidence on any such questions… or any other questions that the hearing process is meant to be open to because this decision falls outside of the hearing scope!
Vilsack strikes again?
This proposal — a price break favoring ESL milk — fits the climate and export goals set forth by Ag-Secretary-then-DMI-executive-then-Secretary-again, Tom Vilsack. The pathway to rapidly consolidate the dairy industry to meet those goals is to tilt the table against fresh fluid milk. This is something Vilsack already put a big dent in by removing whole milk from schools.
It’s like one well respected veterinarian in the industry observed recently in conversation: “Someone decided: Thou shalt drink low-fat milk and like it.”
That “someone” is apparently equally convinced that the industry shall move to ESL and aseptic milk processing… while using dairy farmers’ checkoff funds to figure out how to get consumers to like that too.
35 dairy farmers, industry representatives, and farm media attended “Winners and Losers: a discussion about USDA’s proposed milk pricing reforms,” hosted by the American Dairy Coalition during the 57th World Dairy Expo in Madison, Wisconsin October 3rd.
By Sherry Bunting, Farmshine, October 11, 2024
MADISON, Wis. – “I’m in Wisconsin, and on the graph (below) it looks like producers in Order 30 are having to decide between less money with an Order or even less money without an Order. Am I wrong and is there a silver lining?”
That was the crux of the question one dairywoman asked during the American Dairy Coalition’s (ADC) ‘Winners and Losers’ seminar and press conference Oct. 3 at World Dairy Expo. Over 35 farmers, industry representatives, and media professionals gathered to hear insights about USDA’s recommended decision on changes to Federal Milk Marketing Order (FMMO) price formulas.
American Farm Bureau economist Danny Munch was the invited presenter, followed by time for questions, moderated by Kim Bremmer of Ag Inspirations, and opportunities for networking and farmer-to-media connections during the remainder of the two hours.
Dairy farmers attending ADC’s press conference gave interviews after the discussion on USDA’s proposed milk pricing changes.
At issue was the impact on FMMOs with more cheese and less fluid milk, that would experience the negative impacts of a proposed hike in processor make allowances without the positive buffer of higher Class I location differentials.
Bremmer said over 126 individuals and organizations provided comments to USDA. The comment period ended Sept. 13.
During his visit to Expo on Oct. 4, Ag Secretary Tom Vilsack said USDA would issue a final decision in mid-November. Also on Oct. 4, USDA held a webinar explaining the producer referendum expected in January. (Look for more specifics in a future Farmshine, and check out the Farm Bureau recap here)
The short answers to the above question appear to be yes, yes, and yes. With an Order, producers in some regions will see lower FMMO blend prices. Without an Order, they would lose minimum prices altogether and other important FMMO functions.
The silver lining? Munch pointed to better competition currently for milk, and he sees opportunity for milk in the future as consumers focus on protein.
New to the discussion was make allowance data compiled by AFBF for its official comment at the Federal Register showing the average plant size of processors participating voluntarily in the Stephenson Survey relative to the average plant size of processors reporting to the NASS Dairy Product Manufacturing Survey (below)
The average size and volume of the plants in the voluntary cost of processing survey is 5 to 20 times smaller than the size and volume of plants reporting to USDA on price and production. This is further evidence that mandatory surveys are the only fair way to examine and set make allowance levels.
ADC reports that farmers have called with questions and concerns about the FMMO changes they will vote on. Part of ADC’s mission is to inform dairy farmers and help them understand factors like this that affect their businesses, said Bremmer.
For example, it’s helpful for farmers to realize that current make allowances equate to $2.17 to $3.17 per hundredweight in deductions already in the pricing formulas to cover the cost of converting milk to butter, cheddar cheese, nonfat dry milk, and dry whey.
The proposed new make allowances add 70 cents to $1.00, depending on class utilization, bringing the total deduction to about $2.89 to $4.07 per hundredweight, maybe more.
The splitting of Class I into a two-mover pricing system is also causing discontent and concern. On the one hand, USDA would restore the ‘higher-of’ method for conventionally pasteurized fluid milk but use an ‘average-of’ method with a rolling and delayed adjuster for the extended shelf life (ESL) fluid milk products. This new milk class was not vetted nor defined during the hearing.
Also of concern is the delay in implementing positive updates to milk composition standards that have not been updated since Order Reform in 2000.
USDA’s recommended decision applies to all 11 FMMOs nationally but will be voted on by eligible (pooled) producers in each Order, individually.
A two-thirds ‘yes’ vote within each individual Order continues that Order with the changes. If the two-thirds threshold is not met by either producer numbers or volume in an Order, then the result is termination of that Order.
Producers do not have the option of voting separately on the five pieces of the USDA decision, nor do they have the option of voting to keep the FMMO pricing formulas as they are currently.
Economists with National Milk Producers Federation have stated previously that 65 to 70% of the U.S. milk supply is marketed through cooperatives that tend to bloc vote for their producers, but this percentage can vary on an individual Order basis.
USDA determines voting eligibility, based on whether milk was pooled in the reference period selected by each Market Administrator.
“When we get down the road to the vote, and if we vote ‘no,’ that will dissolve the Order, right?” asked one dairy farmer. “What opportunity does any geography have to reorganize a new Order to fit what works for them?”
Munch said producers could start a process to create a new Order, but it would still be required to use the same price formula rules because these will apply to ALL Orders uniformly. In contrast, he noted that USDA leaves pooling and depooling rules to be decided individually by each Order.
One member of the media pressed Munch to speculate on what happens if a western Order votes no, but an eastern Order votes yes?
“People always want me to speculate on what happens if California or the Upper Midwest vote out their Order(s). What we’ve seen in the past in unregulated areas, or areas with state orders — they still base a lot of their pricing on the nearby Federal Order system,” he responded.
“If we remove more milk out of the Federal Order system, does that system then play less of a role in pricing milk, and does that unregulated market start to dictate and suck milk out of the regulated areas, if you’ve taken out some of the large milk production states? That’s just some speculation, something to think about in the long term,” he said.
On a more immediate basis, Munch said that if an Order is terminated by this vote, “farmers lose protections like timely payments and component verifications, and the minimum prices. You could end up with a patchwork.”
He pointed out that USDA did not raise make allowances by the full amount requested by processors, but also did not go with the more modest increases requested by the cooperatives.
In their post-hearing comments, processors voiced great unhappiness with the decision, he said, because they didn’t get the multi-year increases to even higher levels.
“We don’t blame USDA for trying to come up with a middle ground… we just don’t have the data. The way hearing processes work is they collect this data brought by stakeholders and try to come up with a compromise that works for everybody,” Munch explained. “Our argument is that the data may not reflect market conditions, and we want to make sure that it does. We can’t get that assurance until there’s an audited, mandatory survey.”
As a standalone piece, AFBF estimates that USDA’s proposed increase in make allowances would remove an additional $1.25 billion annually from producer pool revenue, nationwide, based on past pooling data. However, USDA proposes a one-year delay in implementing the milk composition updates that would contribute $200 million annually in producer pool revenue nationwide.
Munch sees the 12-month delay in implementing the milk composition standards and the splitting of the Class I mover with an ESL adjuster as two things that appear to be “thrown in there,” with a lot of groups voicing discontent and confusion.
When asked by a reporter if the add-ons to Class I will create consumer resistance to what could be a 25-cents-per-gallon increase in retail fluid milk prices, Munch cited the hearing record where economists testified to the relative inelasticity of fluid milk demand.
He also sees great opportunity for milk: “When I go to the gym, I used to see no one drinking milk. Now I see tons of people drinking milk, protein shakes, and other things, and it’s not plant-based products. I think milk can take advantage of marketing the protein benefits that people in my generation are looking for and are willing to pay for.”
Munch was asked if AFBF will recommend how its dairy members should vote.
“We will not make that recommendation. We take positions based on our policy, which includes opposing any make allowance updates until we have mandatory cost of processing surveys, and other aspects related to our policy book,” he replied. “It’s up to our members to make those voting decisions, and there is a regionality to this, so we don’t get involved at that level.”
Florida producers, for example, “will be okay with the new rules” because the over 80% Class I utilization brings with it higher location differentials. The Upper Midwest, on the other hand, has been at roughly 5% Class I and 93% Class III, so there is very little benefit from the Class I changes, but those producers are subjected to the highest make allowance deductions for Class III products, which is 95% of their blend price.
WASHINGTON, D.C.— The extended 2018 farm law will expire Sept. 30 in the throes of a tumultuous election year while farm liquidity and cash flow decline in the face of an eroded farm bill safety net.
Witnesses before the House Ag Committee July 23rd were (l-r) Dr. Dana Allen-Tully for Minnesota Corn Growers, David Dunlow for American Cotton Growers, Tony Hotchkiss for Ag and Rural Bankers, Joey Caldwell for the Ag Retailers Association, and University of Arkansas ag economist Dr. Ron Rainey. Hearing livestream screen capture
Witnesses in a July 23 House Ag Committee hearing expressed support for the House bill and made it clear that another extension is a non-starter, with one witness describing the current law as facing a category-five hurricane with no protection.
“Unprecedented challenges are facing the entire agricultural sector, threatening to ignite another farm financial crisis,” said House Ag Chairman Glenn ‘GT’ Thompson (R-Pa.) as he opened the hearing on financial conditions in farm country.
USDA estimates net farm income will see the steepest drop of $43 billion this year – down 27% from 2023 and down 40% from 2022. In its report, USDA notes that livestock farms will also see net cash farm income drop for 2024 across all specializations. Within the livestock sector, dairy farms are forecast to see the largest decrease in average net cash farm income in 2024.
“The impact won’t be fully understood until early next year when farmers are unable to secure operating loans because they can’t cash flow,” said Dr. Dana Allen-Tully, member of a diversified crop and dairy farming family near Eyota, testifying for Minnesota Corn Growers.
In addition to flooding in her region and drought elsewhere, crop producers face income losses of $150 to $233 per acre, she said, citing plummeting prices, high costs of production, doubling interest rates, natural disasters, and tightening credit.
Thompson said these factors create “a perfect storm that will compromise the foundation of our agricultural economy.”
He observed U.S. agriculture is in the largest two-year decline in farm income, and by the end of 2024, total farm sector debt will be the highest since 1970.
“Unfortunately, the farm safety net has not seen significant investment since 2002. The lack of support for those that feed the world is unacceptable,” the Chairman said, pointing to the many farm bill listening sessions across the country.
According to Thompson, the bipartisan House Committee-passed Farm, Food and National Security Act of 2024 represents the largest permanent farm bill investment in over two decades for the farm safety net, conservation, trade promotion, specialty crops, research, and livestock biosecurity.
“It will give renewed strength… just when producers need it most,” he declared, taking aim at “pundits spreading misinformation about this bill in order to sow division.”
Thompson said Democrats in Congress have “unilaterally added billions to climate and conservation programs, and the current Administration added one-quarter of one trillion dollars to nutrition programs — all while ignoring the farm safety net.”
“I will not apologize for advancing a bill that seeks to put the farm back in the farm bill. I am tired of the politics and gamesmanship, and I know folks out in the countryside are too,” he said.
Thompson stated further that this work has been “saddled with a meddling Senate Democrat and others who do not seem to appreciate the dire circumstances in farm country.”
As recently as last week, some Ag Committee Democrats have expressed a preference to see a farm bill fail before engaging in the process, Thompson reported, adding that his door remains open “to renegotiation from any partner willing to come to the table with a serious proposal — not more red lines.”
“For negotiation to be viable, Chairwoman Stabenow needs to unveil her bill text,” he challenged.
During the hearing, witnesses cited meaningful improvements to the safety net via updates to reference prices, crop insurance, and the conservation title.
Both the current 2018 law and the incomplete Senate summary do not meet the needs of farmers, witnesses indicated. Even the stronger safety net in the House bill is not enough, they said, but would help farmers weather the storm.
While pundits say the House bill cuts nutrition programs, Thompson has repeatedly demonstrated no program cuts in the bill, even though the Congressional Budget Office (CBO) score showed $30 billion in savings on the 10-year baseline compared with earlier scores.
Nutrition Title spending accounts for nearly 80% of the estimated $1.5 trillion total farm bill. Nutrition spending also increases by 73% ($484 billion) since the 2018 farm bill enactment.
“Quite frankly, we are not going to have nutrition, if we do not have farmers, so our investment here is in the farm safety net,” Thompson stated.
The House farm bill seeks a stronger farm safety net within a shrinking piece of the total farm bill pie. Senate Ag Committee minority graphic
Ranking member David Scott (D-Ga.) emphasized in his remarks the Democrat position that CCC authority remains “exclusively in the hands of the Secretary of Agriculture,” without the congressional oversight proposed in the House bill.
The witnesses didn’t bite when asked about this. Several indicated it is more desirable to have a stronger safety net so the CCC does not have to be dipped into in the first place.
At the same time, witnesses indicated the need, now, for supplemental intervention under the current price squeeze.
To that point, Rep. Mark Alford (R-Mo.) asked: “Did you know we are losing 1000 farms every month in America right now? It’s a staggering number when we consider our food security and our national security.”
“Working capital is fast depleting,” Dr. Allen-Tully testified. She called John Deere’s layoffs “a canary in the coal mine” and warned against another farm bill extension because “it won’t stop the hemorrhaging. Even a new farm bill with a strong safety net may not be timely or sufficient, though I pray Congress will pass a new farm bill this year because it will help in the long run.
“We put everything on the line for a thin and often negative margin. Young people aren’t going into farming, and that’s why the average age of farmers is nearing 60… no parent wants their kids to go through life facing constant worry. We need our full-time farm and ranch families,” she said.
North Carolina farmer, David Dunlow testified for American Cotton Growers. He noted the size of operating loans farmers in all commodities take on every spring, and the lines of credit with input companies.
“That has to be paid back – every year — before we can go and get another operating loan,” he said. “The margins are very thin … under normal conditions, and with the economy now, nothing cash flows. It’s very difficult to get those loans paid and to move on to the next year.”
Testifying for the Ag and Rural Bankers, Tony Hotchkiss said lenders are seeing changes. Farmers are working through liquidity faster than anticipated and are now beginning to leverage equity through refinancing debt. This is further challenged by the cash flow needed for the refinancing payment.
“This has made ag bankers feel as though they are looking over the cliff,” Hotchkiss stated, stressing the need for ag policy changes, many of which are included in the 2024 House farm bill.
Joey Caldwell of GreenPoint Ag Holdings in the Southeast U.S., testified for the Ag Retailers Association. He said a strong farm bill safety net is critical to Rural America: “If the farmer is not successful, the supply chain is not successful, and this impacts the very fabric of our communities.”
University of Arkansas ag economist Dr. Ron Rainey also testified that farm debt levels are increasing as divergence between input costs over ag prices is widening, even if the overall price indices are higher.
He said more farmers need to be involved in using risk management, whether that is through better subsidy levels or technical assistance to enhance understanding and use of it.
“If they don’t have crop insurance, and if they are outside of the safety net, then they’re financing their risk on their balance sheets. The more we can move from ad hoc disaster assistance, the better off the farmers are,” said Dr. Rainey.
“But where we are now… that’s going to require some intervention. That’s just the bottom line,” he added.
Rep. Eric Sorenson (D-Ill.) brought up sustainable aviation fuel and the inequity in how current Energy Department tax credits are given for ethanol from Brazil and used cooking oil from China, while American farmers, who can serve this need, are getting nothing.
“Sustainable aviation fuel is one of the most exciting things coming as a corn farmer,” Dr. Allen-Tully replied. “But the way the Treasury Department has their guidance written excludes us. It is almost insulting to believe that we would bring in sugarcane ethanol in place of ethanol we can grow here.”
Rep. Mary Miller (R-Ill.) asked witnesses how the climate policies of the current administration are affecting farmers, and she gave her own opinion as a farmer: “It’s painful.”
Caldwell responded, pointing to energy and fertilizer as the largest costs, and they are much higher under these policies.
“Farmers need a strong farm bill,” said Caldwell. “When a farmer plants a crop, they put more than their job at risk. It is their home, their livelihood – a pillar of their community. For many, it is also their family legacy, passed down through generations that they hope to pass on to their kids… they risk losing it all.”
An Iowa State University IEM data graph is the picture that speaks 1000 words about the “tale of two halves”. It shows precipitation highs and lows vs.132 years of records. An April / May data capture looked about the same in the Upper Midwest and Northern Plains, but the drought in the East had not yet become as widespread into the Ohio Valley until June. Some areas are seeing the driest June on record.
By Sherry Bunting, Farmshine, June 28, 2024
EAST EARL, Pa. – Pray for rain. Pray it stops. The contrast could not be starker.
The Mid-Atlantic and Ohio Valley is in the throes of one of the driest growing seasons on record. Meanwhile, the season was already one of the wettest on record throughout the Upper Midwest and Northern Plains before the 8 to 15 inches June 21-23 led to historic catastrophic flooding in northwest Iowa, southeast South Dakota, and southern Minnesota.
The June 24th USDA Crop Progress Report showed a 3 point decline in good-to-excellent corn condition, nationally, falling to 69%. But, sticking in the market’s crawl is the earlier-projected corn crop estimates and the mere 50% good-to-excellent corn crop condition reported for this same week a year ago.
Soybean condition fell 5 points to 67% this week. Again, this beats the 51% good-to-excellent condition reported this same week a year ago.
The impacts on damaged crops and potentially lower yields from floods have yet to be assessed in a region that had already delayed planting, drained and replanted.
Grain markets are shrugging off the weather woes, appearing to be focused primarily on the demand side of the equation looking toward the upcoming end-of-month Grain Stocks report.
Some analysts are expecting an overall bearish mode to hold through at least month-end or longer, despite news emerging of untold acres of corn and soybeans under water along rivers and lakes in Iowa, Minnesota and South Dakota.
Governors of the three states declared statewide emergencies and named scores of counties under disaster declarations. President Biden has announced a federal disaster declaration in Iowa, opening up federal funding there. Other areas may not be far behind.
Lakes and rivers in the region reached levels reportedly higher than in 1993. Towns are under water, nobody in and nobody out, with boat rescues off rooftops and rescues via National Guard helicopters.
As the Big Sioux and Des Moines Rivers reached levels as much as 7 feet above previous records, a 100-year-old Minnesota dam failed, and two railway bridges collapsed that transported ag commodities.
Grain markets did not care. Early this week (June 24-25), “the markets tanked,” said Eric Relph with Commstock Investments in a Marin Bohling interview on the Commstock Channel Tuesday morning (June 25). No market strength emerged yet by Friday. Instead, more red.
“We are still fighting the mentality that rain makes grain,” said Relph.
Much of the Midatlantic region and into the Southeast and Ohio Valley are near record dry for June.
“The concern grows when we have other big chunks of other major growing regions very dry in Illinois, Indiana, and Ohio, having had no rain in three weeks, with cracks in the ground, and plants curling and temperatures up at 75 overnight.”
Analysts are looking back at reactions to the summer flooding of 1993. But as farm broadcaster Max Armstrong observed in a tweet on X (formerly Twitter) Wednesday morning (June 26): “The South America behemoth makes tragic, sickening U.S. flooding far less consequential to the world than it did three decades ago.”
Farmers have taken to social media showing aerial footage of flooded fields, updating ever-increasing rainfall totals while walking the sprayer tracks that have become rivers in a swamp, along with images of busted corn bins and piles of flood-soaked corn in rural towns of northwest Iowa, like Spencer and Rock Valley, all within the targeted dairy growth area of the I-29 Corridor.
The problem, according to Relph, is the region had full moisture profiles coming into the Spring, then more rain constantly through April and May. This was before this 8 to 15 inches of rain that inundated the region.
Aerial photos show flooding in northwest Iowa as an already wetter than normal year was inundated by more rain and storms producing historic flooding.
Relph lives and works there. He described the geographic impact as substantial:
“At the western front of this area that is receiving this kind of rain, we move straight east through Iowa, with as much as 40% of Iowa affected, and it’s up into South Dakota and even North Dakota to a degree, and into central, the southern quarter of Minnesota, over into central Wisconsin and down along the Mississippi, missing Illinois, but including eastern Iowa,” he reported.
Iowa Ag Secretary Mike Naig said state officials won’t have a full sense of the crop damage or number of livestock lost in the region until the flood waters recede.
“This was already a wet part of the state, where there were some challenges around planting and replanting. They’ve just been inundated with rain throughout the spring. We’re hearing about damaged and destroyed equipment. There are livestock facilities that folks are having trouble getting feed to because of washed-out roads, and there are power outages and water outages. These are just some of the things that are really challenging,” Sec. Naig reported.
Farmers are resilient, and they are helping each other get through the most damaging elements and waiting to see how many fields will bounce back, if not under water more than two or three days. Some analysts say growers are not likely to pour management dollars into fields, depending on what the yield losses are predicted to be. It’s virtually too late to replant, even if conditions allow.
As one set of problems affects one region and another set of problems confronts another, Relph said: “It’s a tale of two halves. Without a shift in the weather pattern, it will be detrimental.”
Other analysts interviewed on Rural Radio Wednesday morning point to U.S. and European weather models that show more rain to come in the flooded region, but also going all the way East, keeping the bears in charge of the grain markets, with corn June 25 trading under February lows.
Meanwhile, the concerns now shift as the already flooding rivers flow into the Missouri and Mississippi.
In addition, sources indicate transportation has been affected by I-29 closures in spots from Sioux City, Iowa to Sioux Falls, South Dakota, affecting movement of supplies in and milk out. Trips take four times longer via back roads, and even there, washed out roads are encountered leaving some farms in a tough spot, while suppliers in affected nearby towns face difficulty getting out.
Some roads and portions of I-29 were reopening or partially reopening late June 25 into June 26, but new areas are bracing for the Missouri and Mississippi that are forecast to crest at major levels June 26 and into the first week of July.
Meanwhile, the NOAA Weather Prediction Center map shows rain and strong storms continuing in the Upper Midwest while overspreading the Ohio Valley and into the Mid-Atlantic by June 28.
As for the Midwest, The Weather Channel warns of severe flood risk returns as meteorologists are watching a new system ejecting from the Rockieswith the potential to bring a continued risk of flooding and severe weather in already impacted areas into July.
Ag Moos 