Since 1876 W S l y CHEESE REPORTER Issues/2016/July 15, 2016.pdf · datory GMO labeling bill, but...

Global Dairy Landscape Is Shifting; US Is Facing Some Different Challenges: Levitt

Vol. 141, No. 4 • Friday, July 15, 2016 • Madison, Wisconsin

Serv

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theWorld's Dairy Industry W

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Since 1876

CHEESE REPORTER

House Passes GMO Labeling Bill; Moves To White House For Signing

the transparency American con-sumers deserve.

“This bill is a prime example of why the American people are so frustrated with Congress,” McGov-ern said. “This is a deeply, deeply flawed bill.

“We’re told that this is a man-datory GMO labeling bill, but the truth is – not really. This bill is a deception,” McGovern contin-ued.

Let’s be clear about one thing – this debate is not about the sci-ence regarding GMOs, McGov-ern said. It’s not about whether you love GMOs or hate GMOs. I consume GMOs and my kids consume GMOs. But I still believe that every consumer is entitled to know whether the food they buy contains GMOs.

“That’s what this debate is about – it’s about transparency,” McGovern said.

“And for those who think this ends the debate, that this is it, I have a prediction: you’re wrong. People are going to continue to fight to demand clear mandatory GMO labeling,” McGovern continued.

• See House Passes GMO, p. 8

World Market Will Be More Competitive In Future; Cheese Exports Offer Good OpportunityEgg Harbor, WI—The shifting global dairy landscape will pres-ent some different challenges for the US dairy industry, including more competition, in the com-ing years, according to Al Levitt, vice president, communications and market analysis, US Dairy Export Council (USDEC).

For the US dairy industry, there is a “dramatic contrast” from where we were 20-plus years ago to where we are today, Lev-itt commented at the Wisconsin Dairy Products Association’s 2016 Dairy Symposium here Tuesday.

Twenty years ago, the US was a domestically focused industry, but

step by step, the US has moved into the globalized system.

“This is not necessarily an upbeat presentation,” Levitt said. “The international market is in the tank, it’s been in the tank for about two years, exports are down” and have been down for about two years.

“The landscape has shifted over the last couple years and so it’s going to present some dif-ferent challenges for us,” Levitt continued.

It’s now a very different world for US dairy exporters than it was during what Levitt called the “boom period” of 2003 through 2014, “when everything went our way. We’re all operating in this very different competitive envi-ronment than we were during that boom period.”• See Global Landscape, p. 6

FDA’s Strategic Plan Includes Increased Focus On Preventive Controls Compliance, Not Finding ViolationsWashington—The US Food and Drug Administration this week announced the availability of a strategic plan for fiscal years 2016-2025 for its Foods and Veterinary Medicine (FVM) program.

The strategic plan covers activi-ties of the Center for Food Safety and Applied Nutrition (CFSAN), the Office of Foods and Veterinary Medicine, and the Center for Vet-erinary Medicine, as well as related efforts by the Office of Global Reg-ulatory Operations and Policy and the Office of Regulatory Affairs.

FDA’s strategic plan includes goals and objectives for the next 10 years, including the agency’s mis-sion to implement the Food Safety Modernization Act (FSMA).

The plan is organized under four goals, the first of which is food safety.

Under the first food safety objective, the FVM program will establish and maintain up-to-date, science-based preventive control standards for chemical and micro-biological hazards in food and feed products and use a wide range of tools to foster compliance.

Strategies for meeting this objective include developing and implementing a robust commu-nication, training, and technical assistance plan for preventive con-trol standards; utilizing innovative inspection and compliance strat-egies, backed by administrative and judicial enforcement tools to foster compliance with preven-

• See FDA’s Strategy, p. 5

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Column2Swiss Cheese ProductionMay 2010 – 2016; millions of pounds

Consumer Groups Call Bill ‘A Deception’; Dairy, Food Groups Praise Bill Washington— The House passed legislation on Thursday that would require most food packages to carry a text label, a symbol or an elec-tronic code readable by smart-phone that indicates whether the food contains genetically modified ingredients, or GMOs.

The White House said President Obama will sign the bill, which would supersede a Vermont law that kicked in earlier this month. The House passed the legislation 306-117 on Thursday. The Senate approved the bill last week.

The US Department of Agricul-ture (USDA) will now have two years from enactment of the bill to create a national mandatory bio-engineered food labeling program, with certain exceptions.

Among those who opposed the bill in the House was US Rep. Peter Welch (D-VT), who argued that the measure falls short, espe-cially compared with the tougher labeling requirements in his state. While the bill gives companies

the three options for labeling, the Vermont law would require items be labeled “produced with genetic engineering.”

The bill “guts Vermont’s label-ing law and makes a mockery out of consumers’ right to know,” Welch said. “Absurdly, rather than requiring a simple, plain English GMO label, it allows a producer to require shoppers to call a toll-free number or look up a website on their smartphones to figure out what’s in the food they’re buying.

“Let’s get real. This is not a compromise. It’s a thinly disguised effort to block the right of consum-ers to know what’s in the food they eat,” Welch continued.

Gary Hirshberg, chairman of Just Label It and Stonyfield Farm, said the bill falls short of what con-sumers rightly expect – a simple at-a-glance GMO disclosure on the package. While we support a national, mandatory GMO label-ing system, the legislation passed does not give American consumers the same simple disclosure used in 64 other nations.

US Rep. Jim McGovern (D-MA), said the bill falls short of

Dairy CPI Fell 0.6% In June To Lowest Level In Almost Four Years; CPI For Whole Milk Drops Below 200Washington—The Consumer Price Index (CPI) for dairy and related products was 214.815 in June (1982-84=100), down 0.6 percent from May and 2.2 percent lower than in June of 2015.

That’s the lowest level for the dairy CPI since August of 2012, when it was 214.549. The dairy CPI had reached a record high of 229.87 in December of 2014.

The CPI for all items in June was 241.038, up 0.3 percent from May and 1.0 percent higher than in June of 2015. June’s CPI for food at home was 238.43, down 0.4 percent from May and 1.3 percent lower than in June of 2015.

• See Dairy CPI Falls, p. 7

CHEESE REPORTER July 15, 2016

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But in a world in which nothing lasts forever, US cheese exports started to decline in 2015 and are continuing to decline here in 2016, while cheese imports last year were at their high-est level since 2006, and are running ahead of that pace this year.

Past Issues Read this week’s issue or past issues of Cheese Reporter on your mobile phone or tablet by scanning this QR code.

‘Volatile’ Is The Name Of The Dairy Trade Game

D I C K G R O V E S

Publisher / EditorCheese Reportere: [email protected]: @cheesereporter

EDITORIAL COMMENT

Over the past 25 years or so, the term “volatile” has been used, or over-used, primarily to describe milk and dairy product prices. Today it can also be used to describe the global dairy trade business.

This point came into focus during a presentation by Al Lev-itt, vice president of communica-tions and market analysis for the US Dairy Export Council, at the Wisconsin Dairy Products Asso-ciation’s annual Dairy Symposium in Egg Harbor, WI, this week (for more details, please see the story starting on our front page).

Levitt was blunt in stating that his presentation was not neces-sarily “upbeat,” which is in sharp contrast to presentations he’s made in previous years, when US dairy exports were posting regular if not spectacular increases. Today the global market is “in the tank,” and there aren’t a lot of positives for US exporters, he pointed out.

At least some of the factors Lev-itt mentioned as having changed over the last couple of years will be changing again in the not-too-distant (but unpredictable) future. For example, US dairy exports steadily increased when the US dollar was weak, but they’ve been declining now that the dollar has gained strength.

But the dollar won’t remain strong forever, so that’s one factor that worked in the US dairy indus-try’s favor in the past, isn’t working in the industry’s favor today, but will again work in the industry’s favor sometime in the future.

Also, Levitt noted that the 2003-14 period was characterized by a strong commodity cycle, while there’s been a weak commodity cycle since 2015. Evidence of this point can be seen in a number of ways, including oil and corn prices, both of which reached record highs at some point (or points) over the past decade but, like the global dairy market, are in the tank today.

There are few guarantees in the world today, but here are two of them: oil won’t stay under $50 per

barrel forever, and corn won’t stay under $5.00 per bushel forever.

Yet another factor that’s changed just since 2015 is the end of the EU’s milk production quota system. That system had been in place since the mid-1980s, when the US was almost exclusively focused on its domestic market.

Unlike some other changes over the past couple of years, the EU quota system is gone forever. There is some talk of some form of voluntary milk production cut-backs in the EU, due to ongoing and unsustainably low milk prices, but it seems highly unlikely that the EU will bring back any sort of mandatory quota system, let alone one that remains in place for more than three decades.

So what does all of this trade volatility mean for the US dairy industry? Let’s take a look at one specific segment of US dairy trade: cheese.

Back in 2000, the first year in which the Uruguay Round Agree-ment on Agriculture was fully implemented, US cheese exports totaled 101.1 million pounds, while US cheese imports totaled 415.2 million pounds, for a cheese trade deficit of 310.1 million pounds.

US cheese imports reached an all-time high two years later, at 474.6 million pounds. US cheese exports that year totaled 118.6 million pounds, for a noteworthy cheese trade deficit of 356 million pounds.

The US cheese trade deficit actually grew slightly in 2003, reaching 359.2 million pounds, as cheese imports fell less than a mil-lion pounds from 2002 but cheese exports dropped about 4 million pounds.

That year, 2003, was the begin-ning of a long and steady decline for US cheese imports, which finally bottomed out at 304.8 mil-lion pounds in 2010, due at least in part to a weak US dollar.

Meanwhile, US cheese exports bounced around a bit, falling to 127.1 million pounds in 2005, rising to 288.6 million pounds

in 2008, falling to 238.5 million pounds in 2009 and then grow-ing phenomenally over the next five years to a record 810.4 million pounds in 2014.

As cheese imports fell and cheese exports rose, the US cheese trade deficit shrank, to 86.2 mil-lion pounds in 2008, then rose to 117.7 million pounds in 2009 (the year in which the global financial and economic crisis had its main impacts).

And then it disappeared. In 2010, the US exported 381.3 mil-lion pounds of cheese and imported 304.8 million pounds of cheese, for a cheese trade surplus of 76.5 mil-lion pounds. By 2014, when US cheese exports reached a record high, the US was running a cheese trade surplus of some 448 million pounds.

But in a world in which nothing lasts forever, US cheese exports started to decline in 2015 and are continuing to decline here in 2016, while cheese imports last year were at their highest level since 2006, and are running ahead of that pace this year.

So is all of this volatility in dairy trade a positive for the US dairy industry? We’re reminded of an observation made years ago by Clayton Yeutter, when he served as US agriculture secretary under President George H.W. Bush. Yeutter stated that volatile prices generally lead to higher overall price levels.

It looks like dairy trade is similar: volatile trade still leads to higher overall exports for the US dairy industry. Looking at the afore-mentioned cheese trade balance, cheese exports did in fact drop by more than 110 million pounds from 2014 to 2015 and are on pace to fall maybe another 150 million pounds this year. But the US will still be exporting over half a billion pounds of cheese, something that was unheard of just a decade ago.

International dairy trade is indeed volatile, but it’s still a key source of growth for the US dairy industry.

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CHEESE REPORTERJuly 15, 2016

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For more information, circle #1 on the Reader Response Card on p. 10

Regulations Requiring Domestic, Foreign Food Facilities To Register With FDA FinalizedWashington—The US Food and Drug Administration (FDA) this week published a final rule that amends its regulations that require domestic and foreign facilities that manufacture/process, pack, or hold food for human or animal consumption in the US to register with FDA.

FDA said these amendments to its food facility registration rules will further enhance its capabili-ties with respect to responding to food safety issues and, in addition, provide the agency with informa-tion that it can use to focus and better utilize its limited inspection resources.

This final rule is part of FDA’s implementation of the Food Safety Modernization Act (FDA). Sec-tion 102 of FSMA amends section 415 of the Food, Drug, & Cosmetic Act by requiring that certain addi-tional information be included in facility registrations.

Specifically, FSMA requires that registrations for domestic food facilities are required to contain the email address for the contact person of the facility, and regis-trations for foreign food facilities are required to contain the email address of the US agent for the facility.

Further, the FSMA provides that food facilities required to register with FDA must renew their registrations with the agency every two years, betwen October 1 and December 31 of each even-numbered year, by submitting reg-istration renewals to FDA. And the FSMA provides that all food facility registrations are required to contain an assurance that FDA will be permitted to inspect the facility at the times and in the manner permitted by the Food, Drug, & Cosmetic Act.

These FSMA amendments were self-implementing and became effective upon enactment of FSMA. These amendments are included in this final rule to codify the provisions in 21 CFR part 1, subpart H.

In addition, the FSMA autho-rizes FDA to require that all food facility registrations be submitted to FDA in an electronic format; however, that requirement cannot take effect before the date that is five years after the date of enact-ment (i.e., January 4, 2016).

FDA is implementing this pro-vision of the final rule. However, the agency is delaying the date for mandatory electronic registration until January 4, 2020.

Further, FDA is including a waiver request provision in the rule to allow a registrant to sub-mit a written request to FDA that explains why it is not reasonable to submit the registration, registra-tion renewal, update, or cancella-

tion to FDA electronically, or to explain why it is not reasonable to provide the email address of the owner, operator, or agent in charge of the facility.

FDA is also making changes to improve the utility of the food facility registration database; spe-cifically, the agency is making changes to: require certain addi-tional data elements in food facility registrations (e.g., a unique facility identifier for food facility registra-tions); employ measures to verify certain information submitted in registrations; and take additional steps to ensure that the registration database is up to date by identify-ing additional circumstances under which FDA will cancel registra-tions.

Also, FDA had proposed to amend the regulation to shorten the timeframe for submitting updates and cancellations from 60 calendar days to 30 calendar days. In response to numerous comments received on this issue, the final rule does not shorten the timeframes as proposed.

The final rule provides that updates to registration information or cancellation of registration must be submitted within 60 days of any change to any of the required information or the reason for the cancellation.

FDA had published a proposed rule regarding amendments to food facility registration in April of 2015, and received numerous comments on that proposal.

Some comments recommended that low acid canned foods (LACF) and acidified food processing be treated as an activity type, not a food product category. Comments stated that there are many foods that are LACF or acidified foods that also fall within other food product categories, such as cheese and salad dressings.

Comments stated that FDA investigators would be able to better prepare for inspections if facilities select the activity type “low-acid and acidified food pro-cessing” in conjunction with the applicable food product category (e.g., cheese) for the food pro-duced at the facility.

FDA agrees with these com-ments. The final rule includes acidified food and low-acid food processing in the list of activity type options.

Also, FDA said it will update the food product categories guid-ance to remove acidified foods and LACF as food product categories.

The final rule on food facility registration was published in the Federal Register on Thursday. The rule is effective September 12, 2016.

For more information, visit www.fda.gov.

US Honey Consumption Keeps Rising; Artisan Cheeses, Ice Creams Aiding GrowthFirestone, CO—The National Honey Board recently announced that, according to the latest data from the USDA, honey consump-tion continues to increase, with an average of nearly one pound (0.9 pounds) of honey being consumed per person compared to half a pound per person in 1990.

The USDA report found that consumption of all caloric sweet-eners has been falling for the last 15 years while per capita consump-tion of honey has been increasing over the same time period.

Domestic net production of honey was once at an annual aver-

age of 167.9 million pounds in the early 1990s but has now fallen to an average of 106.7 million pounds over the last seven years. Honey bees are critically important to agriculture as pollinators contrib-uting over $14 billion to the value of US crop production, the Nati-tonal Honey Board pointed out.

There are lighter colored hon-eys which are mild in flavor, while darker honeys are usually more robust in flavor. In addition, honey is in high demand in the growing artisan food category for use in a range of diverse items such as pas-tries, ice creams, cheese and craft cocktails. It has also become wildly popular with beverage manufac-tures including craft brewers and ready-to-drink beverages.

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from our archives

50 YEARS AGOJuly 15, 1966: Washington—Recent confusion over the permis-sibility of using methyl bromide fumigation in the prevention of cheese mite infestation has been clarified and is permissible in accordance with amended toler-ance levels effective this week.

Washington—The evidence for a connection between dietary fat and heart disease doesn’t justify rec-ommendations for radical changes in Americans’ diets, the National Academy of Science reported this week. However, moderate reduc-tion in total fat intake and some substitution of polyunsaturated fat for saturated fat may be suitable for many Americans, the Academy advised.

25 YEARS AGOJuly 12, 1991: Ft. Lauderdale, FL—Kenneth Metz Royer, 91, an early leader in dairy sci-ence and founder of the Purity Cheese Company, died here this week. In 1936, Royer founded the Purity Cheese Company in Mayville, WI. Royer distin-guished himself as an innovator, researcher and administrator.

Sausalito, CA—Gert Madsen of Fromageries Bel was elected president of the California Cheese & Butter Association here this week. Other officers of the California Cheese & But-ter Association elected include Mike Levy, DFE/Bradshaw, first vice president; Jim Hardy, Kay-D Company, second vice president; and Ritz Guggiana, Ritz Distributing, treasurer.

10 YEARS AGOJuly 14, 2006: Washington—The USDA is coming under increasing pressure to reverse its decision last month to recon-vene the federal order hearing on make allowances. This week, top officers from 25 leading dairy companies and cooperatives urged US Ag Secretary Mike Johanns to rethink USDA’s decision to delay updates in make allowances.

Washington—Two dozen health groups, hypertension experts and physicians this week urged US Sec-retary of Health and Human Ser-vices Mike Leavitt to take action to reduce salt consumption in the US. This includes recommenda-tions to lower sodium in every edi-tion of the Dietary Guidelines for Americans.

ADPI Adds Three Industry Professionals To The ADPI Center Of ExcellenceElmhurst, IL—The American Dairy Products Institute (ADPI) has welcomed three additional industry professionals to the ADPI Center of Excellence: A. Kent Keller, Andy Novakovic, and Geoffrey W. Smithers.

The ADPI Center of Excellence is a network of 12 seasoned dairy industry professionals with the expertise to answer questions on a wide range of topics. The group is a key part of ADPI’s ongoing efforts to be the “go-to” authority on dairy ingredients.

The Center of Excellence pro-vides ADPI members with an easy and economical way to gain access to a pool of industry experts capa-ble of addressing any dairy-related questions or concerns they might have, ADPI explained.

Kent Keller’s expertise in lac-tose and permeate manufacturing dates back to the infancy of the whey processing industry 40 years ago. In 1980, he founded his first company, Whey Systems, Inc., which later became Keller Tech-nologies, Inc.

As a result of his innovative processing technologies, Keller has been involved in the design of the majority of the world’s lactose processing facilities, ADPI noted. In 2000, Keller received the ADPI Award of Merit for his lifetime contributions to the dairy prod-ucts industry and was recognized as “Mr. Lactose.”

Dr. Andy Novakovic’s areas of expertise include dairy market eco-nomics and policy. Since 1978, he

has held the position as the E.V. Baker Professor of Agricultural Economics at Cornell University.

During his career, Novakovic has been involved in educational programs to implement major fed-eral dairy programs, including the milk diversion program, the dairy termination program (whole herd buyout), federal order reform, and the Margin Protection Program for dairy.

In 2010-11, Novakovic served as chair of the Dairy Industry Advisory Committee for USDA. From 2011 to 2015, he served as a senior economist in the USDA Office of the Chief Economist.

Dr. Geoffrey Smithers has almost 30 years of experience in dairy pro-cessing and ingredient science and technology. During a career with CSIRO and Food Science Aus-tralia, Smithers successfully built client relationships in capability areas including processing systems, ingredient functionality and deliv-ery, dairy proteins and bioactives, sweet and acid whey, and nutrition science in Australasian, European and North American markets.

Smithers formed his own dairy and food consulting business in early 2009, operating out of Mel-bourne, Australia, and has estab-lished a global client base. He has published extensively in the sci-entific literature, by way of origi-nal research articles, reviews and books.

“We are extremely pleased to welcome these three new industry professionals to the ADPI Cen-

ter of Excellence. Their inclusion reflects ADPI’s commitment to provide our members with reli-able, meaningful and useful infor-mation,” said David L. Thomas, ADPI’s CEO.

Current ADPI Center of Excel-lence professionals include K.J. Burrington, Dr. Phil Tong, Mary Keough Ledman, Mike McCully, Allen Sayler, Bjorn Sorensen, Dr. Lee Blakely, Dan Meyer and Dr. Jim Sullivan.

Information regarding their areas of experience and expertise is available on the ADPI website, at www.adpi.org. ADPI members can identify the person that has the expertise they require and make contact with that resource profes-sional by phone or email. These consultations are done on a confi-dential basis.

For members, there is no cost for this initial consultation. A mem-ber may then choose to employ the consultant directly if more exten-sive assistance is required.

“The ADPI Center of Excel-lence was designed with our mem-bers in mind; it allows them to have more efficient and economi-cal access to valuable industry resources,” Thomas noted.

Members of the Center of Excel-lence also participate in a wide range of ADPI training and edu-cational activities, including pre-paring articles for ADPI’s weekly “e-Update,” developing materials for the ADPI Academy website, presenting at ADPI meetings and seminars, and participating on var-ious member committees and task forces.

For more information, visit www.adpi.org.

PERSONNELRUSSELL COLEMAN will join Dean Foods Company as execu-tive vice president and general counsel, corporate secretary and government affairs, effective Aug. 1. Coleman comes to Dean Foods from Meadows Collier law firm where he was a partner. He also previously served as general counsel of national media com-pany Belo Corp.

BRYAN DOWNER has earned accreditation by 3-A Sanitary Standards, Inc. (3-A SSI) as a certified conformance evalua-tor (CCE). Based in Springfield, MO, Downer serves as vice presi-dent of product management at Central States Industrial and has over 23 years of experience designing and building hygienic fluid and powder handling equip-ment and systems for the food and dairy industries. Downer has been active with 3-A SSI since 2011 and received the 3-A SSI Next Generation Award in 2013. Accreditation as a CCE is

required for individuals who wish to conduct Third Party Verifica-tion (TPV) inspections of food processing equipment and systems covered by 3-A Sanitary Stan-dards and/or Accepted Practices.

ABBY DESPINS has been pro-moted to the position of director of national product communica-tions at the Wisconsin Milk Mar-keting Board (WMMB). Despins started her WMMB career in 2014 as public relations manager where she used her experience to work with cheese companies, food blog-gers and industry media to share WMMB’s messages on a regional and national level. In her new role Despins will spearhead national public relations and social media campaigns for WMMB. Prior to her role at WMMB, she worked in a variety of agency, corporate, and nonprofit roles.

Arnold Heiman, 88, died Friday, July 8 at his home in Marshfield, WI. Heiman was a life-long cheese

maker, working for many years with his wife, Rena Mae, by his side, then bringing his sons Ken, Kelvin and Kim into the family business. Arnold Heiman’s sons now own and operate Nasonville Dairy, in Marshfield, WI.

Alex Daniel Everhart, 23, died Tuesday, June 21 at his home in Cashton, WI. He worked at the family business, K&K Cheese owned by his parents, Kevin and Kimberly Everhart, since his high school graduation in 2011.

Dale W. Chilton passed away on July 2. Chilton worked for the New York State Department of Agriculture and Markets for 38 years. Chilton started first as a milk inspector and later as Dairy Equipment Specialist in the Divi-sion of Milk Control. Later he became an expert in the clean-ing, sanitizing and design of dairy equipment.

If you would like to inform the industry of a recent personnel change or obituary, please send to [email protected].

DEATHS

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Canadian Processor, Producer Groups Conclude Talks On Future Dairy System, Ingredient StrategyCharlottetown, Prince Edward Island—Dairy Farmers of Canada and dairy processor associations this week announced the suc-cessful conclusion of negotiations started last year by representatives of dairy farmers and processors to evolve the Canadian dairy system for the future.

The agreement in principle will now be submitted to indus-try constituents for ratification. Highlights of the agreement will be made public after its final rati-fication. The anticipated imple-mentation date for the agreement is September 1, 2016.

The national agreement includes the creation of an ingre-dient strategy.

“As our dairy industry operates under supply management, it is important that farmers and proces-sors work together to be responsive to the evolution of the market, and this is exactly what this agree-ment in principle is all about,” said Jacques Lefebvre, president and CEO, Dairy Processors Association of Canada.

“Because we all had our eyes on the goal of seizing opportunities to build on the solid system we have today, to invest to foster growth and ensure a more thriving future for both farmers and processors, we have pursued these negotiations in a spirit of collaboration,” said Car-oline Émond, executive director of Dairy Farmers of Canada (DFC).

At DFC’s annual general meet-ing this week in Charlottetown, farmers reinforced their commit-ment to strengthen and grow Can-ada’s dairy industry for the next generation of dairy farmers and Canadians.

Wally Smith, DFC’s president, contrasted Canada’s supply man-aged system with what is going on in the rest of the global dairy sec-tor.

“Supply management is a good agricultural policy. Everywhere else around the world, deregula-tion hasn’t delivered; the coun-tries that are coping the best have strong domestic markets,” Smith said.

On the other hand, “the Cana-dian system remains strong, the sector is growing, and the future is promising,” Smith continued. “We believe in our system, con-sumers believe in our system, and we are committed to strengthening the dairy industry for future gen-erations, because Canadian milk matters.”

Founded in 1934, DFC is the national organization defending the interests of Canadian dairy farmers.

FDA’s Strategy(Continued from p. 1)

tive control standards; evaluating and improving the effectiveness of preventive control standards; evaluating and mitigating the risks of chemical exposures in food and feed products that pose pub-lic health or regulatory concerns; and evaluate and mitigate the risks of microbiological hazards in food and feed products.

Other food safety objectives include: improve prevention, detection, and response to food-borne illness outbreaks and other food and feed safety incidents; strengthen the ability of consum-ers to play a proactive role in mini-mizing food safety risks; enhancing the safety of food and feed addi-tives and dietary supplements; and strengthen existing partner-ships with international, federal, state, local, tribal, and territorial agencies to improve the effective-ness and efficiency of FDA’s food safety program for government and industry.

The second goal of FDA’s strate-gic plan concerns nutrition. Here, the FVM program will use its best available tools, including surveil-lance, research, education, regula-tions and guidance, to best convey nutrition information on food labels, restaurant menus, vending machines, and pet food labels.

The FVM program will advance its understanding of emerging food technologies and nutrition science, along with the changing composition of the food supply, to better implement FVM program nutrition initiatives and evaluate their impact on the nutrition and health status of the US population.

And the FVM program will promote and facilitate the refor-mulation of food toward healthier products. FVM will enhance and support “healthful reformulation” by using regulatory or other mech-anisms such as nutrition labeling, voluntary guidelines, research into healthful ingredient substitutes, and stakeholder collaboration.

The third goal of the FDA stra-tegic plan involves animal health.

Objectives in this area include improving access to safe and effec-tive animal drug products; reduc-ing risks in the manufacturing, distribution, and use of FDA-regu-lated animal health products; and strengthening detection and sur-veillance of problems with FDA-regulated animal health products.

The final goal of the FDA strategic plan involves organi-zational excellence. Objectives here include achieving optimal risk-informed resource allocation throughout the FVM program; optimizing the development and deployment of the FVM program’s scientific expertise and organiza-tional capacity to better understand and detect hazards and devise pre-ventive interventions; and attract, retain, and optimally deploy the skilled workforce required to lead, manage and execute the FVM pro-gram’s public health mission.

FDA is inviting public com-ments on its strategic plan. Elec-tronic comments may be submitted at www.regulations.gov; the docket number is FDA-2016-N-1678.

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Global Landscape(Continued from p. 1)

A lot of the success for the US dur-ing the boom period, and lack of success more recently, has been a product of the competitive envi-ronment, Levitt explained. “For 10 years, we were in the right place at the right time,” but now, some of the market’s characteristics “go against us.”

The 2003-14 period was charac-terized by “global tightness,” Levitt said. There were stretches where global prices were higher than US prices, and it was mostly a seller’s market.

And during that period, US dairy exports increased across almost all product categories, and export volumes tripled.

But a number of fundamental factors have shifted, and “none of them” have shifted in favor of the US, Levitt noted.

Among other things discussed in Levitt address: Over the 2003-14 period, the

European Union (EU) was still operating under its milk produc-tion quota system, but since April of 2015, there have been no EU quotas to constrain supply. Returns from the world mar-

ket were attractive over the 2003-14 period, but are less attractive now. The US dollar was weak

during the 2003-14 period, but is stronger today. There was a strong commod-

ity cycle during the 2003-14 period, but a weak commodity cycle since 2015. Chinese and Asian econo-

mies were growing during 2003-14, but there’s economic stress in Asia today.

There was growing wealth in oil-producing countries over the 2003-14 period, but today there’s economic pressure in those coun-tries due to lower oil prices.

“So you add it all up and we’ve swung from this seller’s market to a buyer’s market,” Levitt continued in his speech.

Levitt talked about a “para-digm shift” that’s taking place; global dairy trade was down about 1 percent last year, the first time trade declined in a decade. From 2008 through 2014, the real “boom period,” global dairy trade increased an average of 6 percent per year.

“So you had this world demand pie growing significantly year after year, and supply couldn’t keep up,” Levitt said. “Today, of course, things are very different.”

It’s not an overstatement to say that probably the single big-gest driver of the global dairy markets over the past decade was the growth in China’s appetite for dairy imports, Levitt said.

From 2008 to 2014, China’s imports increased 28 percent a year; China accounted for almost half of the growth in world dairy trade.

And China was willing to pay “really high prices” for what they were buying, and that drove world prices to record levels. But after peaking in 2014, the imports turned out to be a bubble,” and Levitt thinks that’s demand “that’s probably not coming back.”

And it’s not just Chinese demand that’s been lost, he con-tinued. Russia has been out of the market for almost two years, and now Venezuela is pretty much out of the market. Combined with China, you have three of the world’s biggest dairy import-

ers (collectively, they accounted for about 27 percent of world dairy imports) either cutting back significantly or just not buying at all.

Over the last year, imports from China, Russia and Venezuela were down about 20 billion pounds milk equivalent, compared to the peak in 2014.

World trade is about 160 bil-lion pounds milk equivalent, “so all told, we lost about 13 percent of world demand. It just vanished. And for the next few years at least, that’s demand that’s just not com-ing back,” Levitt said.

On the bright side, other buy-ers have stepped up, Levitt noted. Thanks to low prices, Mexico, Japan, South Korea, Malaysia and Egypt are all buying more than they have in the past.

Not counting China, Russia and Venezuela, imports from the rest of the world were up 9 percent last year.

Meanwhile, the milk supply keeps growing, and “almost all” of the growth is coming from the EU, Levitt said. The EU has the ability to ramp up production “really sig-nificantly when the price is right,” so in the future, without quota restrictions, the EU is “going to be our biggest competition.”

Over the last two years, US dairy exports are down and the US has lost share in “a lot of markets and categories,” Levitt said. Last year, US dairy exports were down 8 percent by volume, and through the first five months of the year, exports were down another 9 per-cent by volume.

The Cheese Export OpportunityCheese exports present a good opportunity for the US dairy indus-try, Levitt said. Global cheese trade is about 5 bil-lion pounds a year, and increased 5.3 percent per year from 2007 through 2013. It stagnated in 2014 and 2015 because Russia stopped importing cheese.

Going forward, if cheese imports grow by just 3 percent per year to 2020, that would be an additional 800 million pounds of cheese that would be needed by 2020, Levitt said. The good news is that most of that expected growth to 2020 is in the same emerging markets that are growing now, such as China, South Korea, Mexico, Southeast Asia and the Middle East-North Africa.

Right now, the US has a “pretty good share” of cheese imports in those markets — including, in 2015, 15 percent in China, 49 percent in South Korea, 76 per-cent in Mexico and 11 percent in Southeast Asia (which includes, in Levitt’s presentation, the Phil-ippines, Malaysia, Indonesia, Singapore and Thailand) — so even if those markets continue to increase and the US holds its share, that rising tide will lift the

US and “we’ll be able to get some of that volume.”

Another positive is that the cheese export opportunity really plays to United States strengths, Levitt said.

The main growth sectors for cheese exports are expected to include Cheddar for processing, pizza cheese and cream cheese, and all of these varieties “are right in our wheelhouse.”

“you add it all up and we’ve swung from this seller’s market to a

buyer’s market.”

—Al Levitt, USDEC

On the supply side, the EU and the US are the best positioned to capture that opportunity, and “that’s just because of the sheer size of our industries,” Levitt said. Smaller cheese exporters like New Zealand, Australia and Argentina will make some incremental gains, but they don’t really have the abil-ity to produce anywhere near the additional product needed to serve that extra 800 million pounds of cheese that the world will need over the next five years.

Markets Will Come BackLevitt ended his presentation by listing five features that will char-acterize the global markets through 2020: The markets are going to

come back, “because they always do.” We’re two years into a bear market and we’re “almost certainly closer to the end of this thing than the beginning.” Global markets are going to

be more competitive over the next decade than they were in the last decade. Demand is growing more slowly, and with quotas no longer in place, the EU has more milk to sell and will be more aggressive in selling it. The world will need US milk

and the US has a “low-enough” cost of production. At least some of the increasing world demand will have to come from the United States. In this climate of heightened

competition, US suppliers will likely focus on their most “closely-aligned” markets. Those are the markets where the US has distri-bution, and has market share, and includes Mexico for milk powder, cheese, whey products and fluid milk; Southeast Asia for skim milk powder, whey products and lactose; China for whey products, skim milk powder, lactose and cheese; South Korea for cheese; and Japan for cheese. To grow, the US will have

to capture some incremental gains outside those primary markets.For more information, circle #3 on the Reader Response Card on p. 10



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Milk Cheddar

Average Retail PricesCheddar & Whole MilkJune 2007 – 2016 Price per pound/gallon

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Dairy CPI Falls(Continued from p. 1)

June’s CPI for cheese and related products was 225.164, down 1.5 percent from May, 2.6 percent below June of 2015 and the lowest cheese CPI since February of 2014, when it was 224.223.

The average retail price for a pound of Cheddar in June was $5.27, down almost 10 cents from May but up more than one cent from June of 2015. June of this year and June of last year are the only two months since April of 2011 in which the average retail Cheddar price was under $5.30 a pound.

The average retail Cheddar price had reached a record high of almost $5.94 per pound in Febru-ary of 2013.

The average retail price for a pound of American processed cheese in June was $4.31 per pound, down more than one cent from May and down more than four cents from June of 2015.

Whole Milk Price Fell In JuneJune’s CPI for whole milk was 199.232, down 0.7 percent from May, down 4.8 percent from June of 2015 and the first time the whole milk CPI has been under 200 since February of 2011, when it was 196.948. The whole milk CPI reached a record high of 231.574 in September of 2014.

June’s CPI for “milk” was 137.661 (December 1997=100), down 1 percent from May and 5.3 percent lower than in June of 2015. June’s CPI for milk other than whole was 140.839, down 1.2 percent from May and 5.7 percent lower than in June of 2015.

The average retail price for a gallon of whole milk in June was $3.115, down more than four cents from May and down more than 25 cents from June of 2015. The average retail price for whole milk has now been under $3.20 per gal-lon for four straight months, after being above $3.75 per gallon as recently as January of 2015.

Retail fluid milk prices were fairly stable in early July, according to the monthly survey conducted by federal order market adminis-trators. They conduct their survey on one day between the 1st and 10th of each month; one outlet of the largest and second largest food store chains and the largest con-venience store chain are surveyed.

In early July, the average retail price for whole milk was $3.35 per gallon, up one cent from early June. The average whole milk price has now been $3.40 per gallon or under for five straight months in the market administrators’ survey.

In early July, average retail whole milk prices ranged from a low of $2.36 per gallon in Hous-ton, TX, to a high of $4.11 per gal-lon in Baltimore, MD.

Six additional cities reported average retail whole milk prices

under $3.00 per gallon in early July: Cincinnati, OH, $2.49; Dal-las, TX, $2.89; Detroit, MI, $2.82; Indianapolis, $2.42; Louisville, KY, $2.72; and Phoenix, AZ, $2.69.

In addition to Baltimore, just one other city reported average retail whole milk prices above $4.00 per gallon in early July: Mil-waukee, WI, at $4.09 per gallon.

Retail prices for reduced fat (2 percent) milk in early July aver-aged $3.27 per gallon, down two cents from early June. Average retail reduced fat milk prices in early July ranged from a low of $2.36 per gallon in Houston to a high of $4.11 per gallon in Balti-more.

The retail price for organic whole milk averaged $4.27 per half-gallon in early July, down five cents from early June. For this price series, market administrators survey one outlet of the largest and second largest food store chains in 29 cities or metro areas located in federal order markets.

Retail prices for whole organic milk had averaged $4.37 per half-gallon in early January, reached $4.39 per half-gallon in early March and have now declined for four consecutive months.

In early July, average retail prices for whole organic milk ranged from a low of $2.98 per half gallon in Houston, TX, to a high of $5.49 per half gallon in Pittsburgh, PA.

Houston was the only city in the market administrators’ survey to report an average retail organic whole milk price under $3.00 per half-gallon in early July. In addition to Pittsburgh, other cities reporting organic whole milk prices above $5.00 per half-gallon in early July were: Baltimore, $5.19; Chicago, $5.09; Kansas City, MO, $5.06; and New Orleans, $5.07.

The retail price for organic reduced fat milk averaged $4.26

per half-gallon in early July, down six cents from early June.

Butter CPI Jumped In JuneJune’s CPI for butter was 233.61, up 1.7 percent from May and 4.8 percent higher than in June of 2015. The butter CPI has been above 229 every month so far this year.

June’s CPI for ice cream and related products was 216.569,

down 0.1 percent from May but 1.6 percent higher than in June of 2015. The average retail price for a half-gallon of regular ice cream was $4.71 in June, down more than nine cents from May but nine cents higher than in June of 2015.

The CPI for other dairy and related products was 146.454 in June (December 1997=100), up 0.7 percent from May but down 0.5 percent from June of 2015.



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Cheese Reporter Ad.pdf 1 2/25/15 5:07 PM

Galloway Company’s Ted Galloway Receives WDPA President’s Award

Ted Galloway (center), vice president of the Galloway Company, Neenah, WI, and general manager of its Classic Mix Partners subsidiary, received the WDPA Presidents Award at the Wisconsin Dairy Products Association’s 2016 Dairy Symposium this week in Egg Harbor, WI. With Galloway are Brad Legreid (left), WDPA’s executive director, and Louise Hemstead of Organic Valley, WDPA’s current president.

House Passes GMO(Continued from p. 1)

“They have a right to know what’s in their food.”

The overwhelming majority of Americans all favor clear manda-tory GMO labeling. I got a radi-cal idea – why don’t we give them what they want?

“Why don’t we just put it on the package? It doesn’t cost any more. The idea that this an effort that will raise food prices is ridiculous,” McGovern said. “This convoluted, complicated labeling system out-lined in this bill, if that’s not going to raise food prices, then a simple and plain English listing on food that says this contains GMOs will certainly not raise food prices.”

Dairy, Food Industry Commends Congress For Passing BillRepresentatives of the food and dairy industries showed over-whelming support for the legisla-tion.

We’d like to thank all the mem-bers of Congress who voted to give consumers access to more product information than ever before with-out stigmatizing a safe and proven technology that is a central part

of modern food production, said J. David Carlin, senior vice president of legislative affairs and economic policy for the International Dairy Foods Association (IDFA).

“This nationwide disclosure sys-tem for GMOs will bring much-needed consistency and additional transparency to the marketplace, and we ask President Obama to sign the bill into law as soon as possible,” Carlin said.

Once the President signs it, the bill will eliminate the confusing patchwork of state labeling man-dates, starting with the one that went into effect in Vermont at the beginning of this month, he con-tinued.

Thursday’s action in the US House to pass the Senate’s biotech food labeling bill is a resounding rejection of activists who have been working for years to under-mine consumers’ understanding of the safety of food biotechnology, said Jim Mulhern, president and CEO, National Milk Producers Federation (NMPF).

“By reasserting the federal gov-ernment’s role in regulating food labeling, the Congress is ending the ‘death by a thousand cuts’ approach of potentially conflicting

state laws in this area,” Mulhern said.

NMPF greatly appreciates the efforts of members of both the House and Senate on this issue, which unfortunately has been one of the most challenging – and important – food policy issues of the 21st century, Mulhern contin-ued.

“Once this process is complete, we can begin moving beyond spe-cious arguments over labels, ter-minology and absence claims, and work to address real food safety and nutrition issues, and further the sustainability of our food system,” Mulhern continued.

We urge President Obama to sign this bill quickly, said Pamela Bailey, president and CEO of the Grocery Manufacturers Associa-tion (GMA) on Thursday. This is a win-win for every American fam-ily in every state.

“The legislation ensures that consumers get more information about genetically engineered ingre-dients, prevents a patchwork of confusing and costly state labeling mandates, and provides the same labeling rules to shoppers regard-less of where they live or shop,” she said.

“It is the right solution to increase disclosure of information that consumers are seeking with-out stigmatizing a safe technology that feeds a hungry and growing world,” Bailey continued.

The grocery industry welcomes this historic legislation, said Leslie Sarasin, president and CEO of the Food Marketing Institute (FMI).

The bill will “both set a prec-edent for clarity in commerce and open up new avenues for providing food shoppers access to the infor-mation they want about the foods

they enjoy and in the manner that is most convenient for them to access it,” Sarasin said. “Every vote today was a vote in support of consumer confidence in the food supply.”

“This nationwide disclosure system for

GMOs will bring much-needed consistency and additional transparency

to the marketplace.”

—David Carlin, IDFA

FMI’s consumer trends data indi-cate food retail customers are con-fident in the safety of the food they buy in their local supermarkets, but are also increasingly interested in the origins and ingredients of their food, Sarasin said.

“This legislation avoids the consumer confusion and crippling limitations to interstate commerce that already are erupting under the current Vermont law and would be multiplied further by a developing patchwork of differing and there-fore confusing state GMO labeling laws,” she said.

“One single national labeling standard circumvents all disad-vantages that a multitude of con-flicting state GMO labeling laws would inevitably create,” Sarasin continued.

“Genetically engineered crops have a decades-long track record of safety and benefits for agricul-tural productivity and our environ-ment,” said Zippy Duvall, president of the American Farm Bureau Fed-eration.

Intelligrated Enters Into Agreement To Be Acquired By HoneywellCincinnati, OH—Intelligrated, a provider of automated material handling solutions, announced recently that it has entered into an agreement to be acquired by Honeywell in a transaction valued at $1.5 billion.

Intelligrated, whose 2016 sales are estimated to be approximately $900 million, designs, manu-factures, installs and supports conveyor, sortation, palletizers, robotics, AS/RS solutions, ware-house execution systems, labor management software and order fulfillment technologies.

The company provides com-prehensive aftermarket support through its Lifecycle Support Services group, providing mainte-nance, technology refresh, modifi-cations, system assessments, spare parts and track-driven training programs. Intelligrated employs more than 3,100 associates in the

US, Canada, Mexico, Brazil and China.

Intelligrated co-founders Chris Cole and Jim McCarthy will con-tinue to serve in a leadership role. Intelligrated will become part of Sensing and Productivity Solu-tions in Honeywell’s Automation and Control Solutions business.

Honeywell employs approxi-mately 130,000 worldwide, gener-ating revenues of $38.6 billion in 2015. Intelligrated’s supply chain automation solutions are a com-plement to Honeywell’s workflow performance solutions, including cloud-connected mobile worker applications, data collection hard-ware and other technologies.

“The Intelligrated story has always been defined by innova-tion and doing whatever it takes to give our customers a competi-tive edge,” says Chris Cole, CEO, Intelligrated. “Joining Honeywell enables us to break new ground with the most advanced levels of systems integration, intelligent software and controls, and data-driven efficiency.


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• SB 60 Clarifier - 90,000 pph Clarification Warm or Cold• M.S.A. 40 Clarifier - 60,000 pph Clarification• S.A.M.R. 15036 Clarifier - 60,000 pph Clarification

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D E L AV A L T E A R D O W N U N I T S• DeLaval 340 - 35,000 pph Warm Sep./1,750 pph Cold Sep.• DeLaval 372 AH - 12,000 pph Warm Separation• DeLaval 390A - 3,500 pph Cold Separation; 7,000 pph Warm Separation; 12,000 pph Standardization • DeLaval 392A - 5,500 pph Cold Separation• DeLaval 392A - 14,000 pph Warm Separation• DeLaval 395A - 20,000 pph Standardizing• DeLaval 510 - 10,000 pph Cold Separation• DeLaval 590 - 10,000 pph Cold/35,000 Standardization Clarification• DeLaval 525 - 25,000 pph Warm Separation• DeLaval 545 - 50,000 pph Cold or Warm Separation







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July 13, 2016—AMS’ National Dairy Prod-ucts Sales Report. Prices included are pro-vided each week by manufacturers. Prices collected are for the (wholesale) point of sale for natural, unaged Cheddar; boxes of butter meeting USDA standards; Extra Grade edible dry whey; and Extra Grade and USPH Grade A nonfortified NFDM. • Revised

WEEK ENDINGStyle and Region July 9 July 2 June 25 June 18

40-Pound Block Cheddar Cheese Prices and Sales Weighted Price Dollars/PoundUS 1.5567 1.5133• 1.4740 1.4196•Sales Volume PoundsUS 13,970,760 13,317,412• 15,252,573 13,949,954

500-Pound Barrel Cheddar Cheese Prices, Sales & Moisture Contest

Weighted Price Dollars/PoundUS 1.7221 1.6613 1.6339 1.5781 Weighted Price Adjusted to 38% Moisture US 1.6352 1.5822 1.5602 1.5065 Sales Volume PoundsUS 10,358,559 9,452,586 10,344,662 9,676,803 Weighted Moisture Content PercentUS 34,71 34.90 35.07 35.05

Butter

Weighted Price Dollars/PoundUS 2.3446 2.3401• 2.3046 2.1852Sales Volume PoundsUS 2,575,103 2,829,292• 3,240,579 3,485,127

Dry Whey Prices

Weighted Price Dollars/PoundsUS 0.2754 0.2697 0.2658 0.2629Sales Volume US 5,555,476 5,900,501 6,621,679• 9,111,393

Nonfat Dry Milk

Average Price Dollars/PoundUS 0.8514 0.8102• 0.8124 0.7949Sales Volume PoundsUS 12,122,110 19,273,221• 18,211,304 17,057,498

DAIRY PRODUCT SALES

Class 1: Equivalent Lb. Fat Lb. SNF LB. Fluid Per CWTNorthern CA $2.6232 $0.6515 $0.0173 $16,37Southern CA $2.6232 $0.6515 $0.0204 $16.64

Statewide Average CWT Price Based Upon Production $16.38 Based Upon Utilization $16.52

Commodity Market Prices Product $ Per LB.Cheese, US 40-block, CME $1.5911AA Butter, CME $2.3175CA Extra Grade & Grade A NFDM $0.7790Western Dry Whey (Mostly) $0.2588

Commodity Reference Price for August Class 1 - $16.8425

California Class 1 Minimum Prices & Other Advanced Prices - August 2016

DAIRY FUTURES PRICESSETTLING PRICE *Cash SettledDate Month Class III* Class IV* Dry Whey* NDM* Butter* Cheese*7-8 July 16 15.07 15.26 27.375 86.525 230.025 1.64107-11 July 16 15.19 15.03 27.375 85.675 230.150 1.64807-12 July 16 14.97 15.26 27.600 87.500 235.000 1.61007-13 July 16 15.14 15.10 27.600 87.200 230.125 1.62707-14 July 16 15.30 15.07 27.600 86.725 230.125 1.6480

7-8 August 16 15.89 16.09 29.600 93.600 237.325 1.72707-11 August 16 15.77 15.79 29.600 92.000 234.625 1.74607-12 August 16 15.70 16.00 29.975 94.750 237.500 1.67007-13 August 16 15.92 15.74 29.975 94.625 232.500 1.69407-14 August 16 16.17 15.87 29.750 94.550 234.800 1.7460

7-8 September 16 16.04 16.35 31.500 96.450 240.000 1.74007-11 September 16 15.89 16.19 31.500 94.750 235.050 1.74007-12 September 16 15.88 16.35 31.500 97.500 240.000 1.68507-13 September 16 16.05 16.34 31.250 97.500 235.025 1.69807-14 September 16 16.31 16.31 31.500 98.675 240.025 1.7400

7-8 October 16 16.13 16.55 32.150 99.000 239.150 1.72507-11 October 16 16.03 16.17 32.150 97.000 232.100 1.72807-12 October 16 16.00 16.45 32.000 99.500 238.075 1.69007-13 October 16 16.10 16.40 32.075 99.850 234.050 1.70407-14 October 16 16.43 16.40 32.075 100.025 236.500 1.7280

7-8 November 16 16.11 16.69 33.000 101.000 223.000 1.69407-11 November 16 16.04 16.33 33.000 98.900 223.000 1.69407-12 November 16 15.92 16.62 33.350 101.750 237.025 1.67507-13 November 16 16.11 16.62 33.000 102.000 233.025 1.69307-14 November 16 16.31 16.62 33.000 102.200 234.250 1.7140

7-8 December 16 15.89 16.52 33.925 103.250 223.000 1.67507-11 December 16 15.89 15.96 33.750 101.025 223.000 1.17407-12 December 16 15.78 16.51 33.425 103.250 227.000 1.66007-13 December 16 15.90 16.41 34.250 103.400 222.000 1.67807-14 December 16 16.00 16.41 32.075 103.825 222.000 1.6989

7-8 January 17 15.82 16.38 34.400 106.000 217.450 1.66607-11 January 17 15.82 16.15 34.400 104.900 211.100 1.68807-12 January 17 15.94 16.30 34.900 107.000 217.450 1.65607-13 January 17 15.75 16.23 35.025 107.000 214.000 1.66707-14 January 17 15.82 16.20 33.000 107.000 213.975 1.6880

7-8 February 17 15.83 15.45 35.500 108.025 208.000 1.67007-11 February 17 15.90 16.23 35.500 108.025 208.000 1.67107-12 February 17 15.95 16.39 35.350 109.500 212.450 1.66307-13 February 17 15.82 16.33 35.350 109.500 208.000 1.65107-14 February 17 15.90 16.33 34.250 109.500 208.000 1.6700

7-8 March 17 15.93 16.48 35.550 110.000 209.000 1.68207-11 March 17 15.91 16.44 35.550 109.000 209.000 1.67607-12 March 17 16.01 16.42 35.500 112.000 211.475 1.67307-13 March 17 15.91 16.44 35.500 111.700 208.000 1.66907-14 March 17 15.92 16.44 35.000 111.700 208.000 1.6760

7-8 June 16 16.03 16.50 35.475 112.050 209.750 1.68207-11 June 16 16.05 16.40 35.475 112.050 209.750 1.68007-12 June 16 16.08 16.45 35.550 112.050 208.000 1.68107-13 June 16 15.99 16.45 35.550 112.050 209.000 1.67807-14 June 16 16.05 16.45 35.000 112.050 209.000 1.6800

7-8 July 17 16.22 16.58 36.000 113.000 209.750 1.69507-11 July 17 16.16 16.50 36.000 113.000 209.750 1.69907-12 July 17 16.10 16.53 36.775 113.000 209.750 1.69007-13 July 17 16.14 16.51 36.775 113.000 209.750 1.69007-14 July 17 16.20 16.51 36.775 113.000 209.750 1.6990Interest - July 14 29,678 3,733 4,035 5,599 5,807 27,211

$1.25$1.30$1.35$1.40$1.45$1.50$1.55$1.60$1.65$1.70$1.75$1.80

J A S O N D J F M A M J

40-Pound Block Avg

CME vsAMS

CME Block/Barrel Price Tracker - 2015 vs. 2016

$1.25

$1.35

$1.45

$1.55

$1.65

$1.75

J F M A M J J A S O N D

2015

2016

$12.00

$14.00

$16.00

$18.00

$20.00


Class II Milk Price2015 vs. 2016

$12.00

$13.00

$14.00

$15.00

$16.00

$17.00

$18.00

$19.00

$20.00


Class IV Milk Price2015 vs. 2016

2015

2015

CHEESE REPORTERJuly 15, 2016 Page 11

DAIRY PRODUCT MARKETSAS REPORTED BY THE US DEPARTMENT OF AGRICULTURE

WHOLESALE CHEESE MARKETS

WEEKLY COLD STORAGE HOLDINGSSELECTED STORAGE CENTERS IN 1,000 POUNDS - INCLUDING GOVERNMENT

DATE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . BUTTER CHEESE

7/11/16 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31,505 92,4327/01/16 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30,644 92,020Change . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 841 412

NATIONAL - JULY 8: Midwest cheese manufacturers report decreases in milk com-ponents, but yields have yet to significantly change. Cheese manufacturers in the West are slowing production where possible as a way to manage growing inventory pressure. Proces-sors are also contemplating blending younger cheese with more aged cheese to alleviate some cheese stocks. Strong sales in the East and Central region have helped alleviate some inventory pressures. Cheddar sales are climbing in the East.

NORTHEAST- JULY 13: Plants are maintaining full production schedules at most area cheese operations in the Northeast. Manufacturing milk receipts remain heavy although warmer temperatures in the Northeast are leading to marginal drops in milk intake volumes.

Wholesale prices, delivered, dollars per/lb:Cheddar 40-lb blocks: $2.0050 - $2.2900 Process 5-lb sliced: $1.8875 - $2.3675Muenster: $2.0250 - $2.3750 Swiss Cuts 10-14 lbs: $2.9650 - $3.2875

MIDWEST AREA - JULY 13: As warm weather prevails and the components in milk decrease, manufacturers are making production adjustments. Milk production is decreas-ing as well, but contracted milk intakes have not decreased enough to have a substantial impact on planned production for many Midwest cheese makers. A few manufacturers do report seeking spot loads of milk and/or condensed skim to fill any open spaces in produc-tion schedules. Sale volumes remain high. Some buyers continue to request additional loads outside of contracts. A few market participants note, specifically, that interest in processed cheese is growing. Overall, many industry contacts are seeing interest in the large majority of cheese varieties increase. Inventories are mixed. Several contacts report being comfortable with inventories now that strong sales have alleviated some stock pressure.

Wholesale prices delivered, dollars per/lb: Process 5# Loaf: $1.7800 - $2.1400Brick/Muens 5# Loaf: $1.9750 - $2.4000 Cheddar 40# Block: $1.7025 - $2.0975Monterey Jack 10#: $1.9500 - $2.1550 Blue 5# Loaf: $2.2425 - $3.2300Mozzarella 5-6# (LMPS): $1.7750 - $2.7150 Grade A Swiss 6-9#: $2.4825 - $2.6000

WEST - JULY 13: Western cheese production remains active and strong. Plenty of milk is finding its way into cheese vats, even in areas where milk production is seasonally down. Domestic demand is good for most types of cheese. Retail cut and wrap cheese sales are solid. And process cheese sales are active while the nation is in the midst of grilling season. Cheese inventories continue to be long. Many market participants feel a large portion of the US cheese stockpile is getting some age on it. Manufacturers are approaching the stocks in different ways. A few are trying to push milk into other manufactured dairy product production in lieu of producing more cheese. Others are seeking to rotate older commodity cheese out by blending with young cheese. In some cases, this is proving more difficult, as processors are finding fresh barrels a little harder to acquire. Cheese manufacturers are also noting the inverted spread between blocks and barrels, which has been largely in place since the end of April. The difference between the block and barrel price is prompting a few process cheese producers to make decisions between using blocks instead of barrels in the make process.

Wholesale prices delivered, dollars per/lb: Process 5# Loaf: $1.7950 - $2.0525Cheddar 40# Block: $1.7075 - $2.1525 Cheddar 10# Cuts: $1.8875 - $2.1075Monterey Jack 10#: $1.8975 - $2.0575 Grade A Swiss 6-9#: $2.5425 - $2.9725

FOREIGN -TYPE CHEESE - JULY 13: Sliced cheese manufactured in the EU con-tinues to be in high demand from EU buyers. Supplies of semi-hard cheese are tight. The inventory of cheese in EU aging programs is at a low level relative to what is considered nor-mal for this time of year. Cheese manufacturers do not seem to be increasing production to replenish stocks, due to competing demands for milk. Demand for cheese from the EU retail food sector is noted as very strong.

Selling prices, delivered, dollars per/lb: Imported DomesticBlue: $2.6400 - 5.2300 $2.1700 - 3.6575Gorgonzola: $3.6900 - 5.7400 $2.6775 - 3.3950Parmesan (Italy): 0 $3.5600 - 5.6500Romano (Cows Milk): 0 $3.3600 - 5.5100Sardo Romano (Argentine): $2.8500 - 4.7800 0Reggianito (Argentine): $3.2900 - 4.7800 0Jarlsberg (Brand): $2.9500 - 6.4500 0Swiss Cuts Switzerland: 0 $3.0025- 3.3250Swiss Cuts Finnish: $2.6700- 2.9300 0

NATIONAL - JULY 8: Butter churning is active through the nation, but at a lower rate compared to Q1 and Q2. Cream supplies continue tightening as ice cream produc-tion remains high and milk components decline. However, many butter processors revved up production, running full sched-ules through the holiday weekend as cream became more readily available. In the East, a few manufacturers are considering switch-ing production from print butter to bulk but-ter. Foodservice demand for print butter is strong, but steady from retailers. The market undertone is mixed. In the Central region, interest for fresh bulk butter is high, but sup-ply is tight. Sales are steady this week. In the West, some manufacturers are transitioning from bulk butter to print butter in advance of increased domestic demand later in the year. Inventories are at seasonal highs and above those of previous years.

NORTHEAST - JULY 13: Post-holiday butter production in the East slowed from the July 4 holiday levels. With current tighten-ing of available cream, processors in some channels are compelled to satisfy contracted cream commitments ahead of churning. Regional butter producers with surplus cream on hand note that butter stocks are adequate for near term needs. Buyers are searching and able to find, at times, sur-plus loads through cash markets. Store ads dropped marginally in the Northeast, but retail and foodservice print butter interest is mostly steady.

CENTRAL - JULY 13: Butter churns are busy in the Central region. Many manufacturers are running full schedules. However, a few butter makers are taking measures to slow down butter production. Cream is reportedly tightening after a short-lived increase in supply from the holiday weekend. Several butter makers report being able to find additional loads of cream with more ease than they had anticipated for this time of year. Some market partici-pants are bringing in loads of cream from other regions where cream is more readily available. A few manufacturers are microfix-ing butter for upcoming contracts and antici-pated sales. Spot sales of bulk butter are intermittent. Some buyers report little to no opportunity to purchase bulk butter. A few industry participants speculate brokers and manufacturers who currently have butter inventories are comfortable sitting on their stocks, as they believe prices on butter will firm throughout Q3.

WEST - JULY 13: Western butter mak-ers continue to position themselves for the end-of-year butter season ahead. Domestic demand is steady and many manufacturers are maintaining stable production sched-ules to meet current needs. However, a few processors have slowed or suspended their churns and have opted to sell cream to Class II manufacturers instead. Cream supplies are getting tighter, especially in the Southwest, but most butter makers say they are not hav-ing any trouble finding cream.

ORGANIC DAIRY - RETAIL OVERVIEW

Total conventional dairy ad numbers decreased 2%, while organic dairy ad numbers increased 52%. Conventional cream cheese in 8-ounce containers ad numbers dropped 29%, with an average price of $1.89. Conventional half-gallon flavored milk ad numbers rose 151% this week, with an average price of $2.31. Conventional yogurt in 32-ounce containers, with an average price of $2.37, saw ad numbers grow by 157%. The US advertised price for 8-ounce conventional cheese blocks averaged $2.19, down 14 cents from last week; 8-ounce shred cheese averaged $2.19, down 11 cents from last week. Ads for 8-ounce organic shred cheese average $3.99, up 29 cents compared to the previous week. The price spread between organic and conventional half gallon milk is $2.05. Last week the spread was $1.57. The price spread is the difference between the national weighted average price for organic, $4.09, and conventional, $2.04. Both conventional and organic milk ad numbers took a dip this period, conventional milk number of ads dropped 38% and organic milk ads dropped 14%. The price spread between organic and conventional butter is $1.77.

National Weighted Retail Avg Price: Cheese 8 oz block: NACheese 8 oz shred: $3.99Sour Cream 16 oz: $3.32 Cottage Cheese 16 oz: $3.54Butter 1 lb: $4.82

Greek Yogurt 4-6 oz: $1.06Yogurt 4-6 oz: $1.30Yogurt 32 oz: $2.99Milk gallon: $5.65Milk ½ gallon: $4.09Ice Cream 48-64 oz: $3.50

RETAIL PRICES - CONVENTIONAL DAIRY - JULY 8Commodity

Butter 1#

Cheese 8 oz block

Cheese 1# block

Cheese 2# block

Cheese 8 oz shred

Cheese 1# shred

Cottage Cheese

Cream Cheese

Ice Cream 48-64 oz

Flavored Milk ½ gallon

Flavored Milk gallon

Milk ½ gallon

Milk gallon

Sour Cream 16 oz

Yogurt (Greek) 4-6 oz

Yogurt (Greek) 32 oz

Yogurt 4-6 oz

Yogurt 32 oz

US NE SE MID SC SW NW

3.05 3.31 3.28 2.50 2.65 2.86 3.30

2.19 2.22 2.31 2.14 2.12 2.00 2.01

5.21 5.59 2.99 4.80 NA 3.99 5.20

7.14 6.99 NA 5.44 NA 7.99 7.11

2.19 2.28 2.31 1.90 2.28 1.93 1.89

3.88 3.69 NA 3.63 4.13 NA 3.99

1.98 2.09 1.70 1.73 2.21 2.16 2.15

1.89 1.72 2.03 1.52 2.48 1.76 2.23

3.11 2.85 3.14 3.33 3.27 2.91 3.38

2.31 1.99 3.00 2.08 NA 2.50 NA

3.24 2.99 3.99 2.50 1.99 3.99 NA

2.04 2.50 NA NA 2.06 NA 1.25

2.72 3.69 3.27 2.25 3.10 2.78 2.19

1.79 1.64 1.50 1.66 1.94 2.32 1.83

.93 .96 .91 .94 .80 .94 .93

4.77 4.99 5.49 NA 5.24 4.81 3.63

.52 .49 .46 .54 .44 .45 .77

2.37 2.23 NA 2.00 NA NA 2.56

Butter 1# 3.05 3.31 3.28 2.50 2.65 2.86 3.30

Cheese 1# block 5.21 5.59 2.99 4.80 NA 3.99 5.20

Cheese 8 oz shred 2.19 2.28 2.31 1.90 2.28 1.93 1.89

Cottage Cheese 1.98 2.09 1.70 1.73 2.21 2.16 2.15

Ice Cream 48-64 oz 3.11 2.85 3.14 3.33 3.27 2.91 3.38

Flavored Milk gallon 3.24 2.99 3.99 2.50 1.99 3.99 NA

Milk gallon 2.72 3.69 3.27 2.25 3.10 2.78 2.19

Yogurt (Greek) 4-6 oz .93 .96 .91 .94 .80 .94 .93

Yogurt 4-6 oz .52 .49 .46 .54 .44 .45 .77

US: National Northeast (NE): CT, DE, MA, MD, ME, NH, NJ, NY, PA, RI, VT;Southeast (SE): AL, FL, GA, MD, NC, SC, TN, VA, WV; Midwest (MID): IA, IL, IN, KY, MI, MN, ND, NE, OH, SD, WI; South Central (SC): AK, CO, KS, LA, MO, NM, OK, TX; Southwest (SW): AZ, CA, NV, UT; Northwest (NW): ID, MT, OR, WA, WY

NATIONAL - CONENTIONAL DAIRY PRODUCTS

WHOLESALE BUTTER MARKETS

NDM - CENTRAL: Low/medium heat nonfat dry milk prices are steady this week on light trading. Production is active in the Central region. Farm level milk output is slowly decreasing as the region faces pro-longed hot, humid weather. Manufacturers continue to make low/medium heat NDM a priority when scheduling dryer runs. Demand is mixed. Some buyers are cau-tious in the current market and are choos-ing to stay on the sidelines. Other industry contacts feel demand is picking up and report growing inquiries from buyers. Inventories in the Central region are gen-erally long. Steady demand and active pro-duction is building inventories for several manufacturers. Heavy stocks have some industry contacts questioning the longev-ity of firming prices. International interest is steady. Very few manufacturers are producing any high heat NDM that is not already committed. Inventories are tight and many manufacturers report having no availability for spot load sales.

NDM - EAST: Marginal declines in milk production have offered limited resistance to steady drying rates of low/medium non-

fat milk at some facilities. NDM is mov-ing with improved demand from cheese manufacturers as needed for product fortification and from ice cream through contracts. Manufacturers continue to add to increasing stocks. The market expecta-tions of a noteworthy price drop, at this point, is viewed as doubtful by some in the market, as low/medium heat NDM forward contracts expand. Global interest is good. Production is on an as-needed basis to meet contractual needs.

NDM - WEST: Some resellers are still confused about the upward NDM spot price movement during the recent weeks. According to them, supplies are readily available in the f.o.b. spot market. How-ever, offers from manufacturers to brokers have declined this week. On the other hand, some processors indicate that NDM stocks are trending lower in line with the regional farm milk production. At this point, the market undertone is firm. International demand, especially from Mexico, is strong. Domestic demands from bakers and dry mix manufacturers are active. Spot sales activity has been light to moderate.

DRY DAIRY PRODUCTS - JULY 14


CME CASH PRICES - JULY 11 - JULY 15, 2016Visit www.cheesereporter.com for daily prices

CHEDDAR CHEDDAR AA GRADE A 500-LB. BARRELS 40-LB. BLOCKS BUTTER NFDM

MONDAY $1.7200 $1.6300 $2.2750 $0.8975 July 11 (NC) (NC) (-¾) (+¾)

TUESDAY $1.7225 $1.6300 $2.5000 $0.8975 July 12 (+¼) (NC) (-2½) (NC)

WEDNESDAY $1.7225 $1.6300 $2.2725 $0.8700 July 13 (NC) (NC) (+2¼) (-2¾)

THURSDAY $1.7350 $1.6500 $2.3025 $0.8750 July 14 (+1¼) (+2) (+3) (+½)

FRIDAY $1.7450 $1.6600 $2.3200 $0.8750 July 15 (+1) (+1) (+1¾) (NC)

Week’s AVG $1.7290 $1.6400 $2.2840 $0.8830 Change (+0.0415) (+0.0387) (-0.0129) (-0.0001)

Last Week’s $1.6875 $1.6013 $2.2969 $0.8831AVG

2015 AVG $1.6120 $1.6480 $1.8685 $0.7690 Same Week

MARKET OPINION - CHEESE REPORTERCheese Comment: Wednesday’s block market activity was limited to an unfilled bid for 1 car at $1.6300. On Thursday, the only block market activity was an unfilled bid for 1 car at $1.6500. One car of blocks was sold Friday on an offer at $1.6600, which raised the price. The barrel price rose Tuesday on a bid-based sale of 1 car at $1.7225, increased Thursday on an offer-based sale of 1 car at $1.7350, and rose Friday on a bid-based sale of 1 car at $1.7450.

Butter Comment: The price declined Monday on an offer-based sale of 1 car at $2.2750, fell Tuesday on a bid-based sale of 1 car at $2.2500, rose Wednesday on an unfilled bid for 1 car at $2.2725, increased Thursday on an unfilled bid for 1 car at $2.3025, and rose Friday on a bid-based sale of 1 car at $2.3200.

NDM Comment: The price increased Monday on unfilled bids for 2 cars at 89.75 cents, fell Wednesday on a sale of 1 car at 87.0 cents, and rose on a sale of 1 car at 87.5 cents.Thursday on an unfilled bid for 1 car at 89.75 cents.

WHEY MARKETS - JULY 11 - JULY 15, 2016

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RELEASE DATE - JULY14, 2016

Animal Feed Whey—Central: Milk Replacer: .1300(NC) – .2150 (+¼)

Buttermilk Powder: Central & East: .7500 (NC) – .8600 (NC) West: .7450 (+5½) – .8200 (+2) Mostly: .7500 (+5) – .8000 (+2)

Casein: Rennet: $2.6000(+5) – $2.8500 (+5) Acid: $2.6500 (+5) - $2.9000 (NC)

Dry Whey Powder—Central (Edible): Nonhygroscopic: .2300 (+½) – .3500 (NC) Mostly: .2350 (NC) – .2750 (NC)

Dry Whey–West (Edible): Nonhygroscopic: .2350 (+½) – .3400 (+2½) Mostly: .2500 (+1) – .2925 (+¾) Dry Whey—NE: .2550 (+¾) — .3000 (+½)

Lactose—Central and West: Edible: .1850 (NC) – .3775 (NC) Mostly: .2300 (NC) – .3225 (+¾) Nonfat Dry Milk —Central & East: Low/Medium Heat: .8300 (NC) – . 9600 (NC) Mostly: .8500(NC) – .8900 (NC) High Heat: .8800 (NC) - .9800 (NC) Nonfat Dry Milk —Western: Low/Medium Heat: .8150 (+1) – .9500 (NC) Mostly: .8700 (+2) –.9300 (+2) High Heat: .9100 (NC) – 1.0225 (NC)

California Weighted Average NFDM: Price Total Sales July 8 $0.8668 6,516,484 July 1 $0.7755 7,988,919

Whey Protein Concentrate—Central and West: Edible 34% Protein: .5900 (+½) – .7800 (NC) Mostly: .6650 (NC) – .7275 (+1¾)

Whole Milk—National: 1.1800 (-6) – 1.4500 (+6)

Visit www.cheesereporter.com for dairy and historical cheese, butter, and whey prices

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

‘01 9.22 10.05 11.34 12.12 14.16 14.82 14.96 15.26 15.55 12.30 10.60 10.97‘02 11.42 10.40 10.20 10.59 10.23 9.59 8.90 9.69 9.93 10.42 8.97 9.43‘03 9.58 9.36 8.84 9.21 9.54 9.50 12.59 14.03 14.14 14.21 12.50 11.61‘04 11.10 11.74 15.57 19.88 19.34 16.35 12.76 14.01 14.03 13.60 15.14 14.00‘05 14.38 13.93 13.87 14.34 13.39 13.62 14.01 12.99 14.23 13.72 12.69 13.26‘06 12.56 11.14 10.49 10.43 10.48 10.65 10.28 10.8 11.87 11.40 12.32 12.37‘07 12.47 13.20 14.13 15.20 18.05 21.18 20.54 19.41 19.34 17.65 19.75 18.58 ‘08 16.91 17.54 16.94 16.79 18.66 19.12 17.77 16.14 16.63 16.63 15.14 13.95‘09 9.02 10.11 10.45 10.41 9.54 9.52 9.39 11.29 11.40 12.69 13.76 15.04‘10 12.72 12.95 11.13 12.30 12.40 12.23 13.37 14.39 15.48 15.66 13.14 12.22‘11 12.49 16.92 16.76 14.34 14.74 18.79 19.35 18.60 16.63 15.78 17.19 15.14‘12 14.23 13.42 13.67 13.43 13.56 14.65 15.18 16.57 17.50 19.43 18.48 16.30‘13 15.84 15.41 15.02 16.92 17.20 15.91 15.65 16.32 16.65 16.82 17.30 18.03‘14 20.31 21.14 22.16 21.73 19.34 19.07 18.69 19.96 22.39 20.94 18.70 14.78‘15 13.75 13.78 13.97 14.22 14.63 15.55 14.98 15.74 14.94 14.75 14.43 12.90‘16 13.08 13.05 13.24 12.71 11.37 13.03 record high

HISTORICAL MILK PRICES - CLASS 4B

USDA’s Milk Production Forecasts Are Mixed, But All 2016, 2017 Price Forecasts Are RaisedWashington—The US Depart-ment of Agriculture (USDA), in its monthly supply-demand esti-mates released Tuesday, raised all of its dairy product and milk price forecasts for both 2016 and 2017 as demand “remains robust.”

USDA reduced its 2016 milk production forecast by 200 million pounds, to 212.4 billion pounds, as the pace of cow herd expan-sion has slowed. However, the milk production forecast for 2017 is raised by 300 million pounds, to 215.6 billion pounds, as higher forecast milk prices and lower feed costs in late 2016 and early 2017 are expected to lead to higher 2017 milk cow numbers.

Fat basis dairy exports are low-ered for 2016 as slowing sales of butterfat products more than offset higher whole milk powder exports. The 2017 forecast is unchanged. On a skim-solids basis, the export forecasts for 2016 and 2017 are raised on higher whole milk pow-der sales.

For 2016 and 2017, dairy imports are unchanged on a fat basis, but are raised on a skim-solids basis.

Cheese, butter, nonfat dry milk and dry whey prices for 2016 and 2017 are all forecast higher as demand remains robust.

More specifically, cheese prices are now projected to average $1.5150 to $1.5450 per pound this year and $1.5650 to $1.6650 per pound next year; butter prices are now projected to average $2.155 to $2.215 per pound this year and $1.9400 to $2.0700 per pound next year; nonfat dry milk prices are now projected to average 78.5 to 81.5 cents per pound this year and 86.5 to 93.5 cents per pound next year; and dry whey prices are now projected to average 25.0 to 27.0 cents per pound this year and 28.0 to 31.0 cents per pound next year.

Class III and Class IV price forecasts are also raised for both 2016 and 2017 as the component product price forecasts are raised. USDA now projects that the Class III price will average $13.90 to $14.20 per hundredweight in 2016 and $14.50 to $15.50 per hundred in 2017, and that the Class IV price will average $13.80 to $14.20 per hundred this year and $13.50 to $14.60 per hundred next year.

The all milk prices are also fore-cast higher, at $15.55 to $15.85 per hundred for 2016 and $15.70 to $16.70 per hundred for 2017.

Projected 2016/17 US feed grain supplies are raised this month as lower beginning stocks are more than offset by increased produc-tion. Projected season-average prices received by producers for 2016/17 are lowered for all the feed grains, with corn down 10 cents to $3.10 to $3.70 per bushel.


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