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Stakeholders urge Congress
to take action on ag priorities

September 23, 2016

WASHINGTON — As the end of the fiscal year approaches and the 2016 Election is on the horizon, dairy and ag stakeholders are urging Congress to move on legislative priorities impacting the farm and food sectors.

Congress’s main focus is working to pass a continuing resolution (CR) to avoid a government shutdown when current funding expires Sept. 30.

News reports say Senate and House leaders currently are considering a CR that would extend funding at fiscal 2016 levels through Dec. 9. Congress would then need to pass an omnibus appropriations bill to continue federal funding through the remainder of fiscal 2017.

Meanwhile, dairy and ag industry stakeholders are urging progress on other issues including funding for child nutrition programs, passage of trade agreements and further support for struggling dairy farmers.

The Improving Child Nutrition Integrity and Access Act of 2016 was unanimously approved by the Senate Agriculture Committee earlier this year, but it has not yet been considered by the full Senate. A House version of the bill was passed by the House Education and Workforce Committee in May. Dairy stakeholders say Senate passage of the bill is key in the process of getting a bill to conference with the House and a negotiated agreement to President Obama’s desk as soon as possible.

The International Dairy Foods Association (IDFA) notes Senate leaders are making another attempt to push child nutrition reauthorization through the chamber as they did earlier in July, but IDFA sources have indicated that the bill may have to wait until after the election.

IDFA says its sources say there’s a small chance the bill may pass before the lame duck session, but it was looking increasingly unlikely as the week progressed.

• Trade issues

Agriculture stakeholders also are urging Congress to approve the Trans-Pacific Partnership (TPP) trade agreement by the end of the year.

In a letter sent this week to House and Senate leadership, leaders of the American Farm Bureau Federation, Information Technology Industry Council, Coalition of Services Industries and National Association of Manufacturers (NAM) laid out import benefits expected to accrue from the trade deal that would give U.S. farms, ranches and companies access to nearly 500 million consumers in the Asia-Pacific region.

“As the most productive industries in the world, our enterprises need access to new consumers and markets to sustain, let alone grow, production and good-paying jobs,” the letter says. “Yet, U.S. industries face increasing competition as our global competitors are benefiting from trade deals that exclude and disadvantage the United States. The status quo is not acceptable for industries that need new markets to sustain and grow our workforces in the United States.”

NAM, IDFA, the National Milk Producers Federation, the North American Meat Institute and the Wine Institute this week also hosted a briefing on Capitol Hill covering a key trade issue at stake during ongoing negotiations with the European Union (EU) about the Transatlantic Trade and Investment Partnership (TTIP). Specifically, the briefing focused on geographical indications (GIs), which is a highly-contested topic in the agreement.

IDFA says the briefing drew 30 attendees, including staff members of representatives who serve on the House Dairy Farmer Caucus and agriculture and judiciary committees.

IDFA notes that although the trade talks have been slowed by the United Kingdom’s vote to secede from the EU and dampened by statements from senior French and German government officials, lead negotiators for the United States and the EU hold firm that a deal can be completed by the end of the year. The next round of negotiations for TTIP is scheduled for Oct. 3.

Beth Hughes, IDFA director of international relations, joined representatives of the other organizations to explain how the EU’s stance on GIs would be harmful to many U.S. companies. If included in the agreement, the GI provisions could stop U.S. companies from using many common food names like parmesan, champagne, feta and bologna in the United States and markets around the world.

• On-farm economic concerns

Meanwhile, in a Senate Ag Committee hearing held Wednesday by Chair Pat Roberts, R-Kan., U.S. Agriculture Secretary Tom Vilsack testified about USDA’s work and economic concerns voiced by the U.S. farm sector.

Vilsack says USDA has largely done what’s within its power under Congress to aid the struggling dairy farm sector. He notes the agency purchased $20 million in cheese products and would have liked to do more, but current Commodity Credit Corp. restrictions limit what USDA can do.

He notes over the past two years, the combination of a strengthening dollar and relatively high global production leading to lower prices for commodities has resulted in a large drop in 2015 and 2016 net farm income, relative to the 2011-2014 period. USDA expects real net farm income this year to be the lowest since 2009, he adds.

Vilsack says while data suggest net farm income remains relatively high by historical standards, it is clear financial stress is increasing and that some producers are more exposed to financial risk.

“In general, those producers with high costs of production, rent a significant portion of their land base or have increased borrowing to cover operating costs will be most exposed to financial risk as returns decline with commodity prices,” he says.

The current farm safety net that was created during the last farm bill is providing support for producers, Vilsack adds. In 2015, government farm program payments totaled about $10.8 billion and are expected to increase to nearly $13.8 billion in 2016. In addition, the crop insurance program offset more than $6 billion in farm losses in 2015 and is expected to cover more than $9 billion in 2016, he says.

“While we have been able to use certain authorities to provide assistance during this downturn, existing congressional restrictions on previously available disaster assistance authorities have the potential to limit our ability to react quickly and provide additional assistance if current market conditions persist or worsen,” Vilsack says. “While I sincerely hope they are not needed, Congress should consider lifting these restrictions so that the next secretary of agriculture will be able to react as necessary to future needs.”



A little goes a long way:
Blue cheese packs in the flavor

September 23, 2016

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

By Stephanie Awe

MADISON, Wis. — Despite evidence that the creation of blue-veined cheeses may have been accidental, their pronounced flavor makes them an unmistakable presence amongst all cheese varieties.

There are several types of blue-veined cheeses, whose family includes Blue, Roquefort, Gorgonzola, Stilton, Danableu, Rosenbourg and others.

According to the Wisconsin Milk Marketing Board (WMMB), no record exists of the first Blue cheese, which has a creamy-ivory hue and a piquant, full and earthy flavor. Some historians suggest that mold from the Penicillium family accidentally transferred from bread to cheese sitting nearby, WMMB says.

Others say the original blue-veined cheese is Roquefort, which dates back many centuries, according to Dean Sommer, cheese and food technologist, Wisconsin Center for Dairy Research (CDR).

Roquefort is made from ewe’s milk and has an AOC designation, which is a French legal description of a food product and conditions of manufacture. To be sold as Roquefort, the cheese must fit certain criteria. One such requirement is using powders and cultures prepared in France, from the traditional sources in the micro-climate of the natural caves in the specified area of Roquefort, says Mark Johnson, assistant director, CDR.

Gorgonzola, another type of blue-veined cheese, was first made in northern Italy and also was made from sheep’s milk — although today it is typically made from cow’s milk, especially in the United States, according to Sommer.

Blue and Gorgonzola are the only two blue-veined cheese varieties that hold a U.S. standard of identity in FDA’s Code of Federal Regulations (CFR), Sommer says.

According to the regulation, Blue cheese is characterized by the presence of bluish-green mold, Penicillium roquefortii, and must be at least 60 days old before sale. The minimum milkfat content for the cheese is 50 percent by weight of the solids, with a maximum moisture content at 46 percent by weight.

Gorgonzola, on the other hand, must be at least 90 days old before sale and has a maximum moisture content of 42 percent by weight. It also contains Penicillium roquefortii, and the minimum milkfat content is 50 percent by weight of the solids, according to CFR.

• Blue cheese make, characteristics

There are two general categories of mold-ripened cheese: blue-veined cheeses and white-molded cheeses. In blue-veined cheeses, the mold grows inside the cheese, whereas white-molded cheeses grow mold on their exteriors, Sommer says.

In order for mold to grow inside blue-veined cheeses, the cheese must have oxygen in its interior. As such, these cheeses have an open texture on the inside and are typically punched with stainless steel needles, Sommer says.

The flavor associated with Blue cheese comes from a class of compounds called “keytones,” Sommer adds. The compounds are a breakdown of milkfat, from which Blue cheese’s flavor originates. Therefore — unlike most other cheese varieties — milk for making Blue cheese often is homogenized to divide the milkfat globules into smaller sizes, increasing the total surface area of the globules in the milk and resultant cheese.

This process allows the enzymes in the cheese to break down the milkfat much faster than in most other cheese varieties. Sometimes, lipase is added to the milk to speed up this process even more, Sommer adds.

When Blue cheese is made at Caves of Faribault in Faribault, Minnesota, it is punched after it has been formed into a wheel, allowing oxygen to move through the cheese and the blue veining to “bloom,” according to Jill Ellingson, plant manager, Caves of Faribault, a wholly-owned subsidiary of Swiss Valley Farms Cooperative, Davenport, Iowa.

Before they are punched, the company’s Blue cheeses are hand salted. Once punched, they sit in an open environment ­— the company’s historic sandstone caves — for about three weeks before they are bagged to stop additional blooming, Ellingson says.

“The sandstone has the ability to breathe,” she says, noting the caves provide an environment that facilitates the cheese’s development. Water can move horizontally and vertically throughout the sandstone, and the sandstone also is able to absorb ammonia, Ellingson says. In addition, the sandstone caves are 99 percent pure quartzite, have about 99 percent humidity and maintain 52 degrees Fahrenheit year-round.

Caves of Faribault’s Blue cheeses, AmaBlu and AmaBlu St. Pete’s Select, are then moved into a colder area of the cave for storage until reaching 75 or 100 days of age, respectively.

• Production and retail sales

U.S. production of Blue and Gorgonzola cheeses increased 1.8 percent from 2014 to 2015, totaling about 94.5 million pounds, according to the USDA’s Dairy Products 2015 Summary published in April 2016.

However, while Blue cheese retail sales recently have increased 0.3 percent (52 weeks ending Aug. 7, 2016, U.S. multi-outlet and convenience stores), its retail sales generally have been on a modest decline over the last five years, according to Information Resources Inc. (IRI) data courtesy of Dairy Management Inc.

Natural Blue cheese (fixed weight only) has 0.32-percent volume share among all cheese types, and sales tend to spike during holidays such as Christmas and New Years, the data says.

The most common Blue cheese formats sold in U.S. multi-outlet and convenience stores are crumbled and partial rounds, according to the data.

• Flavor

Blue cheese offers various levels of flavor that appeal to different customer preferences.

For example, at Rogue Creamery, Central Point, Oregon, the company aims to appeal to customers who have experienced various cheese flavors, says Francis Plowman, marketing director, Rogue Creamery.

Oregon Blue is considered its gateway Blue cheese because its flavor is most approachable compared to its other Blue cheese varieties, offering a buttery taste that includes a bouquet of flavors, including huckleberry and sweet nuts, Plowman says. It is Rogue Creamery’s most popular Blue cheese flavor among all of its sales outlets — wholesale, foodservice, retail and internet sales — and some is distributed to the European Union, Australia and South Korea.

The company’s second-most popular flavor, Smokey Blue, has a bolder taste that binds together sweet and savory flavors, Plowman says.

For Roelli Cheese in Shullsburg, Wisconsin, owner and master cheesemaker Chris Roelli aims for a customer base seeking a more familiar flavor.

As such, Roelli specializes in Cheddar/Blue cheese hybrids, which offer a subtle Blue cheese flavor, he says.

“It’s a transitional Blue cheese,” he says, noting that his cheeses are more Cheddar than they are Blue. “There are people out there who do not like the flavor of Blue cheese.”

Roelli’s Dunbarton Blue is modeled after traditional English farmhouse Cheddar with Blue added, he says. His other Blue cheese variety, Red Rock, is a colored American-style Cheddar that incorporates blue veins using Penicillium roquefortii. Each recipe is different and offers its own texture and flavor.

Meanwhile, Old Chatham Sheepherding Creamery, Old Chatham, New York, offers a sheep’s milk Ewe’s Blue that has a “fudgy” texture and a rich, lightly salted and somewhat sweet flavor — a good alternative to Roquefort, says Eric Anderson, lead Blue cheesemaker, Old Chatham.

• Applications

Blue-veined cheeses have a variety of applications.

Some, such as Old Chatham’s Ewe’s Blue, do well with cooking.

“It’s flavor holds up well even after it’s been melted,” Anderson says.

Ewe’s Blue also can be used in dressings or added to caramelized onions and garlic to make a quick-and-easy, flavorful pasta sauce, he adds.

Similarly, Roelli says the company’s Red Rock is used when cooking and makes a good topping for a cheeseburger. Both Red Rock and Dunbarton Blue are used in restaurants for cheese plates and appetizers, he adds.

Rogue Creamery’s Blue cheeses also are incorporated into chefs’ dishes to add a dash of extra flavor in their recipes, while consumers will enjoy them by themselves or use them as a topper on foods such as salads, fish and steaks, according to Plowman.

“One of the great things about Blue cheese is there is a lot of flavor in a small amount,” he says.

• Trends

Blue cheese applications extend beyond appetizers and entrees.

For example, Rogue Creamery’s Blue cheese is a popular incorporation into desserts, such as cheesecake. Rogue first created a cheesecake recipe using its Crater Lake Blue in 2006, combining savory and sweet flavors. Since then, the recipe has been used by customers and in fine-dining restaurants, Plowman says.

Rogue’s Crater Lake Blue also is incorporated into an ice cream flavor at a local ice cream company, where it is a popular choice among customers, he says.

“A lot of people don’t like an overly sweet dessert,” Plowman says, adding that the idea for the ice cream arose from European traditions of serving cheese after dinner.

Pairing Blue cheese with artisan ciders and craft brews also is an up-and-coming trend. At Old Chatham, cheesemakers have begun research and development with local breweries and cider makers to incorporate beer or cider in the cheese.

“I think (the idea is) coming from the whole local movement — it seems like everywhere you go there’s a craft brewer somewhere,” Anderson says, noting that, by partnering with another local company to provide a local flavor, consumers likely will be eager to try it.

While the cheese is not yet for sale, Old Chatham is experimenting with local beer and cider flavors to accompany its Blue cheese. Pairing especially well is a dark brown double ale that adds a sweet, fruity taste with notes of caramel, Anderson says. To produce the flavor, the cheese is washed with the brew daily starting several weeks before it is wrapped, he adds.

Similarly, Caves of Faribault offers its Blues & Brews series, a line of seasonal Blue cheeses that are infused with different beers, all from the same company, and include Summer Ale, Oktoberfest and Winterfest brews, Ellingson says. The cheeses are available for each season every year, she adds.

The overarching trend in Blue cheese recipes, however, may be to stick to methods proven tried and true.

For example, Caves of Faribault has not changed its AmaBlu recipe in an effort to preserve the cheese’s heritage, Ellingson says.

Similarly, Anderson notes that Old Chatham tends to stick to traditional methods when making Ewe’s Blue, which he says yield the best results.

This tactic is mirrored by other cheesemakers as well, such as Roelli, who says his philosophy is to stick to what works.

“If it’s not broke, don’t fix it,” he says.



U.S. milk production rises
1.9 percent from year ago

September 23, 2016

WASHINGTON — Milk production in the 23 major milk-producing states during August totaled 16.66 billion pounds, up 1.9 percent from August 2015, according to data released this week by USDA’s National Agricultural Statistics Service (NASS). (All figures are rounded. Please see CMN’s Milk Production chart.)

July revised production in the 23 major states, at 16.88 billion pounds, was up 1.7 percent from July 2015. The July revision represents an increase of 48 million pounds or 0.3 percent from last month’s preliminary production estimate.

The number of milk cows on farms in the 23 major states was 8.68 million head, 43,000 head more than August 2015 and 15,000 head more than July 2016. Production per cow in the 23 major states averaged 1,920 pounds for August, 26 pounds above August 2015. This is the highest production per cow for the month of August since the 23-state series began in 2003, NASS says.

For the entire United States, milk production during August totaled 17.74 billion pounds, up 1.9 percent from August 2015.

The number of milk cows on farms in the United States was 9.36 million head, 45,000 head more than August 2015 and 16,000 head more than July 2016, NASS says. Production per cow in the United States averaged 1,895 pounds for August, 27 pounds above August 2015.

California led the nation’s milk production with 3.29 billion pounds of milk in August, down 1.7 percent from its production a year earlier. There were 1.77 million cows in California in August, down 11,000 head from August 2015 and down 1,000 head from a month earlier. Production per California cow in August averaged 1,860 pounds, down 20 pounds from August 2015.

Wisconsin followed with 2.54 billion pounds of milk in August, up 2.4 percent from its production a year earlier. There were 1.28 million cows in Wisconsin in August, down 2,000 head from August 2015 and unchanged from July 2016. Production per cow in Wisconsin in August averaged 1,990 pounds, up 50 pounds from a year earlier.


Organic Valley to purchase
FCC facility in Oregon

September 23, 2016

McMINNVILLE, Ore. — La Farge, Wisconsin-based Organic Valley has agreed to purchase the Farmers Cooperative Creamery (FCC) plant in McMinnville, Oregon, a small community 50 miles southwest of Portland that is a central location for Organic Valley’s Pacific Northwest farmer-members.

Organic Valley says the plant purchase reinforces the cooperative’s regional model of processing, distributing and selling products in the communities where they are produced. It also supports the co-op’s mission to serve family farmers and the rural communities where they live.

Organic Valley plans to renovate the plant to align with its operations, which will include a significant investment in new equipment and state-of-the-art technology, the co-op notes.

“The Pacific Northwest has always been an important region for organic dairy, and we’ve relied for years on great partnerships with processors and handlers there,” says Bob Kirchoff, chief business officer, Organic Valley. “Today, we are especially grateful for the opportunity to create an actual Organic Valley owned and operated facility here to support the 72 family farms in Oregon and Washington that are members of our cooperative.”

FCC is a cooperative of regional dairy farmers in the process of a major reorganization as most members move to other cooperatives, says Michael Anderson, CEO, FCC.

“Market demands on regional milk supplies have grown to outpace the local production capacity for the fresh market, and more and more milk to serve the McMinnville facility must come from further and further distances where our competitors have local processing facilities, which makes being competitive in a world market tougher,” Anderson says. “FCC membership took the lead to proactively find solid long-term futures for our members to manage in the modern market.”

Anderson says FCC will continue to operate as a cooperative for the time being to manage accounts for members, without any production facility. FCC will close its plant in the coming weeks. After completion of the purchase, Organic Valley will renovate the facility with hopes of opening in the late winter or early spring of 2017, according to Organic Valley.

Anderson notes FCC employees are in the process of winding plant production down at this time pending the property sale. FCC employees displaced by the plant closure will have resources available to them to assist in obtaining possible future employment or retraining.

“Farmers Cooperative Creamery has been gravitating toward the specialty, value-added focus with a growing share of our dairy portfolio for years,” he says. “This current planned reorganization allows the FCC members and our ownership group an opportunity to look at a number of exciting strategic options in setting a course for the future of their own local and regional dairy farms.”


BelGioioso moves forward with classic cheeses, new creations

By Kate Sander

GREEN BAY, Wis. — Providing consumers with top quality Italian cheeses in convenient formats continues to be the hallmark of BelGioioso Cheese Inc., a family-owned Italian cheese company based in Green Bay, Wisconsin.

“Quality cheese speaks for itself,” says Gaetano Auricchio, BelGioioso vice president, who notes that the company’s commitment to tradition and excellence carries with it the value of knowing how to make Italian cheeses just as they were made long ago from recipes passed down by generations. “We’re consistent, we provide great customer service and have fair pricing.”

Though the company has grown tremendously in the nearly 40 years since Gaetano Auricchio’s father, Errico, moved from Italy to the United States to pursue cheesemaking on this side of the Atlantic, the passion for tradition and quality has never diminished.

BelGioioso Cheese currently operates eight locations in Wisconsin with a ninth cheesemaking operation in New York. Last year, the company completed an expansion of its packaging facility in Ledgeview, Wisconsin, and a brine capacity expansion at its Chase, Wisconsin, plant. This year, the company continues to add to its Ledgeview facility, expanding its shipping and distribution areas.

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Preference for ‘natural’ boosts
annatto extract demand, price

September 16, 2016

By Rena Archwamety

MADISON, Wis. — Annatto, the orange-hued extract from seeds of the Bixa orellana tree grown in equatorial regions, has been widely used as a coloring and spice for centuries and as a cheese pigment since the late 1800s. Its popularity continues to flourish, especially as food companies recently have started seeking more natural ingredients due to increased consumer demand.

Global culture and color supplier Chr. Hansen has been supplying annatto colors for the cheese and dairy industry since 1876, two years after the company was founded. The company notes that the major proportion of the world’s annatto production comes from the collection of seeds from small trees and bushes planted on family farms. Key markets from which annatto seeds are sourced include Brazil, Peru, Kenya, India and the Philippines.

“Annatto is an ancient seed that has been used for a very long time, all the way back to local tribes using it for face painting and the coloring of clothes,” says Christian Hjortholm Steffensen, marketing manager and strategic account manager, Chr. Hansen.

Steffensen adds that annatto is an affordable and widely used natural coloring for cheese and other food products in the United States and most parts of the world.

“It’s a relatively inexpensive natural color,” he says. “Many natural colors are quite expensive compared to artificial colors. Annatto is an exception, due to its large tradition and supply network.”

There are two primary types of annatto coloring: bixin, which is oil-soluble, and norbixin, which is water-soluble.

“The food industry uses bixin for things like butter, processed cheese, popcorn oil and certain snacks,” says Campbell Barnum, vice president of branding and market development at global color provider D.D. Williamson (DDW). “Norbixin is used in natural cheeses like Cheddar, Red Leicester or Gouda, vanilla ice cream, peach yogurt, chocolate drink mix and egg substitutes.”

The use of annatto originated as a way to achieve a consistent color for cheese, according to David Potter, vice president and technical manager of Madison, Wisconsin-based The Dairy Connection, an ingredient supplier to small-scale cheesemakers.

“In the winter it would be very white, and in the summer, when the cows were out on pasture, there was more beta carotene in the milk, producing a richer cheese color,” Potter says. “When marketing it on a large scale, they wanted more of a standardized color approach.”

Potter adds that annatto tends to be used more in Cheddar in the Midwest, while more Cheddars on the East and West coasts are white. Annatto also is used more commonly in barrel cheese and shreds.

• Natural demand

At the beginning of this year, Kraft Heinz changed the formulation of its Kraft Macaroni & Cheese, replacing synthetic colors with colors derived from annatto and other natural sources. This greatly increased the demand for annatto, contributing to rising prices.

“Because of the size and scale of these major brands, this does change the amount of supply needed from the annatto industry,” Steffensen says. “With consumers being more concerned than ever with what they eat, the demand for natural pigments like annatto will most likely only go up from here.”

He adds that there may be even more demand in the future as other leading food manufacturers such as Mars, General Mills, Kellogg’s and others also have committed to converting to natural colors, potentially increasing demand for annatto in the confectionery, cereal and other industries.

DDW notes that with the increased demand, annatto supply in the last 24 months has gone from OK to finely balanced to tight. Prices currently are higher than they have been in five to six years.

“On a year-to-year basis, we have seen growth in annatto demand,” Barnum says. “Certainly to have a large brand like Kraft Mac & Cheese switch has had an effect.”

The price of annatto color solutions varies depending on the format and concentration used in different applications. Despite rising prices, Steffensen says he does not expect demand to slow as consumers continue to demand natural ingredients.

“Natural colors, while expensive, still make up less than 1 percent of the retail price of most food items,” Steffensen notes. “And in this new food world, consumers simply expect that level of quality.”

• Supply challenges

Among the challenges in balancing annatto supply with demand are those that come with any crop that is subject to weather and other local variables.

Since annatto comes from trees that take three to four years to mature, farmers can’t plant and harvest more supply on short notice, DDW notes. Instead, they need to plan in medium- to long-term cycles, looking ahead at least five or more years.

Furthermore, DDW notes, the majority of annatto comes from smaller suppliers in regions with underdeveloped agricultural sectors. The crop competes with others such as cashews, coffee, bananas and cocoa. If prices of these competing crops rise or timing of harvest overlaps, farmers may prioritize these other crops over annatto, reducing its supply.

Pernille Arskog, commercial technical manager, Chr. Hansen, says about every three to four years she has seen a wide fluctuation in annatto prices such as the recent increase.

“It’s about how much is actually grown and how good the yield is,” she says. “As a company, we can work diligently with farming practices, transport and production, but we cannot control the weather. Natural colors are real food.”

Weather is one uncontrollable factor that has contributed to rising annatto prices in addition to increased demand. Steffensen notes that in the last two to three months, key markets such as Brazil have experienced drought and frost that have impacted about 30 percent of the annatto production.

“Once and now again, there might be an exceptionally bad harvest,” he says. “From our perspective, there’s no doubt we’re entering a period where prices of annatto will go up. It’s significant, but not more than we have handled in the past. We’re going to work through it with the farmers and our customers.”

Both Chr. Hansen and DDW spread their sourcing out among various regions in an effort to mitigate raw material fluctuations.

In addition to working with its suppliers to achieve a sustainable, high-quality annatto yield, Steffensen says, Chr. Hansen diversifies its supply market to include multiple continents in both hemispheres.

“We have a very established footprint in key markets with over 100 years of creating relationships with farmers and sourcing only high-quality annatto,” he says. “If a harvest is poor in Brazil, our global sourcing setup allows us to source raw material from other markets like Kenya. We have offered annatto for a long time and have always managed these fluctuations.”

Prices, however, are expected to remain high in the near future. DDW says based on supply and demand fundamentals, annatto prices will remain high in the short term, at least through the next six months. Chr. Hansen estimates a better harvest next year with better annatto yields.



Global dairy groups seek
WTO action against Canada

September 16, 2016

WASHINGTON — Dairy organizations in the United States, Australia, the European Union, Mexico and New Zealand this week called for government officials to initiate a World Trade Organization (WTO) dispute settlement proceeding against Canada regarding recent actions they say will restrict dairy trade.

In a joint letter sent this week to trade and agriculture officials in their respective countries, the groups say Canada’s increasingly protectionist policies violate “international trade obligations, hold out the prospect of trade diversion with the attendant global price depressing impacts and are in conflict with the principles of free markets and fair and transparent trade.”

The U.S. groups, including National Milk Producers Federation (NMPF), the U.S. Dairy Export Council (USDEC) and the International Dairy Foods Association (IDFA), oppose a Canadian agreement in principle reached earlier this year between Canada’s dairy producers and processors. (See “Canada increases butter, SMP support prices; producers, processors agree on new strategy” in the July 22, 2016, issue of Cheese Market News.)

The agreement will, among other things, establish a new ingredient milk class to be priced at the lowest of the U.S., EU and Oceania price for solids-non-fat (SNF) for seven years, the letter notes. This provision provides both an incentive to substitute those ingredients for their imported counterparts and a subsidy on the production of the end product containing those ingredients, violating Canada’s obligations under a number of WTO and North America Free Trade Agreement (NAFTA) provisions, the letter says. The groups also argue that Canada’s actions would undermine the intent of the pending Trans-Pacific Partnership (TPP) and the EU-Canada Comprehensive Economic and Trade Agreement (CETA). If ratified, Canada’s agreement would take effect Nov. 1.

The dairy organizations in the letter request the authorities of Australia, New Zealand, Mexico, the United States and the European Commission to initiate a WTO dispute settlement proceeding against Canada once the agreement details are announced.

“For years U.S. exporters have borne the brunt of a continuing procession of new Canadian policy tools intended to curtail dairy imports,” says Tom Suber, president, USDEC. “TPP has included new features to move toward more open trade by expanding market access compared to the status quo, but Canada’s been doing its best to erode longstanding existing access as much as possible before this agreement is even put in place.”

In addition to USDEC, IDFA and NMPF, the other dairy groups who signed the letter include: the Australian Dairy Industry Council, the European Dairy Association, the European Whey Products Association, the European Association of Dairy Trade, Mexico National Chamber of Industrial Milk and the Dairy Companies Association of New Zealand.

This letter follows another recently sent to U.S. trade and agriculture leaders by Sens. Chuck Schumer, D-N.Y., and Tammy Baldwin, D-Wis., urging an investigation into Canadian dairy policies that they said could raise compliance issues with NAFTA and WTO obligations. (See “Senators urge investigation into Canada diary pricing policies that impact U.S. exports” in the Sept. 2, 2016, issue of Cheese Market News.)

“The dairy trade situation with Canada has gone from bad to worse this year, and now Canada is contemplating doubling down on that terrible track record,” says Jim Mulhern, president and CEO, NMPF. “Enough is enough; Canada needs to stop shirking its dairy commitments and hold up its end of already negotiated agreements.”

Connie Tipton, president and CEO, IDFA, says Canada’s continued disregard for the provisions in its pacts with trade partners is unacceptable.

“These protectionist policies are in direct conflict with principles of free markets and trade, which trade agreements like TPP aim to promote,” Tipton says.



High supply leads to lower
USDA cheese price forecast

September 16, 2016

WASHINGTON — The 2016 and 2017 forecasts for cheese and butter prices are lowered in USDA’s most recent “World Agricultural Supply and Demand Estimates” report, released this week, as supplies remain high. Meanwhile, prices for nonfat dry milk (NDM) and whey are forecast higher as the global supply tightens and demand strengthens.

Cheese now is projected to average $1.600-$1.620 per pound in 2016, down from $1.610-$1.630 in last month’s report. In 2017, USDA forecasts cheese will average $1.605-$1.705, down from its forecast of $1.615-$1.715 last month.

Butter now is forecast to average $2.080-$2.120 in 2016, down from the forecast range of $2.140-$2.180 in last month’s report. In 2017, USDA forecasts butter will average in the $1.955-$2.085 range.

Meanwhile, NDM is forecast to average $0.810-$0.830 in 2016, up from $0.795-$0.815 in the August forecast. In 2017, the average NDM price is forecast to rise to fall in the $0.890-$0.960 range.

Dry whey now is forecast to average $0.260-$0.280 in 2016, up from $0.255-$0.275 in last month’s report, and then climb to $0.295-$0.325 in 2017.

USDA lowered its Class III price forecast for both 2016 and 2017 as the reduction in the cheese price more than offsets the whey price increase. Class III milk in 2016 now is expected to average in the $14.75-$14.95 per hundredweight range, down from $14.80-$15.00 in the August report. In 2017, USDA forecasts Class III milk will average in the $14.95-$15.95 range, down from its forecast of $15.00-$16.00 last month.

The 2016 Class IV price forecast is lowered to $13.65-$13.95, down from $13.75-$14.05 in last month’s report, as the lower butter price more than offsets the higher NDM price. In 2017, though, higher NDM prices more than offset the lower butter price forecast, leading USDA to increase the Class IV price forecast to $13.80-$14.90, up 20 cents from last month’s report.

The all-milk price forecast is lower at $16.10-$16.30 in 2016 but unchanged at $16.15-$17.15 for 2017.

In this month’s report USDA forecasts 2016 milk production to total 212.2 billion pounds, up 100 million pounds from its August forecast. In 2017, milk production is projected to climb to 216.1 billion pounds, up 300 million pounds from the previous month’s report.


Continental Dairy to add
buttermilk powder, butter

September 16, 2016

COOPERSVILLE, Mich. — Continental Dairy Facilities LLC, Coopersville, Michigan, has announced a $50 million expansion project for butter and buttermilk powder at its Coopersville plant. The expansion will create 10 new full-time jobs at the dairy.

Continental Dairy Facilities LLC was established in 2012 and is owned by Select Milk Producers, a group of family-owned dairy farmers.

“We have experienced astonishing success at Continental Dairy over the past four years, and it only makes sense that we are adding butter to our list of ingredients that we manufacture,” says Steve Cooper, president, Select Milk Producers, and general manager of dairy manufacturing operations. “We are extremely pleased to also be adding to our workforce and investing in our local community with this expansion.”

Continental Dairy currently manufactures nonfat dry milk, condensed milk and cream, and the company exports products to 15 different countries.


Global market fundamentals
are stabilizing, analysts say

September 9, 2016

By Alyssa Mitchell

MADISON, Wis. — Analysts this week say global milk production is beginning to temper, lending support to global dairy prices, which could lead to reconciliation with higher U.S. dairy prices down the line.

This week’s Global Dairy Trade (GDT) auction showed higher average prices for all commodities traded on the platform, with Cheddar averaging $1.5586 per pound, butter averaging $1.7073 per pound and skim milk powder (SMP) averaging $1.0088 per pound (see full GDT results in this issue).

With the exception of milk powder, these prices are still below current U.S. dairy prices at the Chicago Mercantile Exchange (CME). But should global cheese markets continue to converge, U.S. cheese stocks could erode fairly quickly, resulting in greater export opportunities for U.S. cheese and limiting imports, analysts say.

While milk production is starting to decline in Europe and Oceania, lending price support, U.S. milk production continues to stay consistent and herds continue to grow, says Eric Meyer, president of HighGround Dairy, Chicago.

At the same time, U.S. butter and cheese stocks are high, and the markets are choppy, he says.
According to USDA’s Dairy Market News, industry contacts suggest inventories are still a little long, but not to the point of being a concern. Some cheese cutters say they have noticed a little more tightness for cheese blocks, Dairy Market News adds.

Cheddar blocks at the CME reached the mid-$1.80s at the end of last month but since have moved lower into the upper-$1.60 to lower-$1.70-per-pound range. Cheddar blocks settled at $1.71 per pound today.

Cheddar barrels reached the upper $1.80s last month but since have fallen into the mid-$1.60s and lower, settling at $1.605 per pound today.

Dairy Market News notes Midwest cheese production has slowed somewhat.

“With the seasonal downturn in milk intakes, manufacturers report discounted spot loads of milk are not as readily available. Processors are hesitant to buy additional milk unless they can get a good deal or unless they need it to meet product commitments,” Dairy Market News says. “A few manufacturers have scheduled facility downtime in order to get maintenance and repairs completed.”

Mike McCully, owner of The McCully Group LLC, Chicago, says the improvement in global prices is supportive to U.S. prices later this year and into 2017, but the United States first needs to deal with rather large cheese and butter stocks. Therefore, exports, while more competitive than they were a month ago, are not expected to suddenly jump higher; rather, the increase in global prices likely will slow the pace of imports next year, which is supportive to higher U.S. prices, he says.

CME butter prices continue to be supported above $2 per pound, settling at $2.0325 today. Analysts anticipate butter could move below $2 by the end of the year.

“I think cheese and butter prices are poised to be choppy over the next 40-60 days and then move lower as inventories overwhelm moderate demand,” Meyer says.

Dairy Market News says some butter manufacturers report having enough cream supplies for churning and are running operations at full capacity. However, cream volumes are very tight in a few processing plants as cream is clearing into Class II and Class III milk.

Meanwhile, as this week’s GDT auction showed additional support for SMP, it has brought firm bids to CME nonfat dry milk (NDM) futures, Meyer notes. U.S. and Oceania nonfat powder prices are some of the most closely aligned of the dairy commodities, with U.S. NDM settling at $0.905 per pound today compared to $1.0088 per pound for SMP at this week’s GDT auction.

Meyer says the best opportunity for U.S. exports currently lies with NDM and SMP.

“The U.S. has the ability to be competitive,” he says. “We can flip the switch to SMP, which we’re already doing, and the U.S. is already becoming more competitive in some regions with nonfat.”

However, McCully says price recovery for NDM may be slower than what is currently projected by futures prices, noting the large stockpile of SMP in Europe and adequate U.S. stocks. He anticipates NDM prices to move toward $1 per pound by the end of the year and then trade over $1 by the first quarter of 2017.

McCully adds that milk production in Europe and New Zealand are key factors impacting the dairy price outlook for 2017.

“Most have been surprised at the speed of the drop in European milk output,” he says. Meanwhile, “for New Zealand, the recent milk payout increase gets farms back to near break-even, but that likely isn’t enough to spur growth in milk production given several years of negative returns,” though it should help stabilize the financial conditions of dairy farms in the country. (For more on Fonterra’s revised milk forecast, see “Fonterra increases farmgate milk forecast” in last week’s issue.)

Another global factor could be the re-entry of China as a buyer in the market, says James Dunn, professor of agricultural economics at Pennsylvania State University. He notes the U.S. dollar has weakened some, and if China starts buying, it will raise prices everywhere.

“I understand that China has worked off some of its inventories, so its long-awaited re-entry into the dairy markets may be imminent,” he says.

Meyer notes that from a domestic standpoint, high stocks and uncertainty heading into the election season likely will create more of a bearish market sentiment as the end of the year approaches.



Traditional, innovative British
cheeses finding new markets

September 9, 2016

Editor’s note: Passport to Cheese is Cheese Market News’ feature series exploring the dairy industries of nations around the world. Each month this series takes an in-depth look at various nations/regions’ dairy industries with coverage of their milk and cheese statistics and key issues affecting them. The nations’ interplay with the United States also is explored. We are pleased to introduce our latest region — the British Isles.

By Rena Archwamety

MADISON, Wis. — Cheesemaking in the British Isles dates back to the Roman occupation in the first century A.D., according to Jason Hinds, sales director and co-owner of prominent London cheese retailer Neal’s Yard Dairy. The Romans, who had experience in dairying, contributed to the development of local cheeses, particularly those made on farms around the Roman town of Chester, the birthplace of Cheshire cheese.

“Essentially, we are a nation of cow’s milk cheese producers,” Hinds says. “Because the climate is cool, we generally made hard cheeses that could be kept as a way of preserving milk so it didn’t spoil.”

He adds that cheeses generally have been made on the western side of the British Isles where most of the rainfall comes, and they bear names of the villages or counties where they were made, such as Cheshire, Lancashire, Gloucester and Cheddar.

Starting in the late 1800s, the introduction of large-scale dairies and factory cheese production, along with cheaper competition from abroad, resulted in a reduction of farmhouse cheesemakers — those using milk from their own herds for small-scale cheesemaking. Hinds notes that numbers continued to decline as many of the cheesemakers went to war, and rationing continued in the years following World War II. Later on, the advent of supermarkets, regulations and increasing mass production further reduced the number of small and farmhouse cheese producers.

• Major dairies

The Milk Marketing Board was established in 1933 to manage and market British milk and cheese, providing more stability for farmers and cheesemakers. The Milk Marketing Board also began manufacturing much of the cheese, continuing to produce and market cheese and other dairy products until it was abolished in 1994.

Today there are a number of large cooperatives and dairy brands that process and market milk for dairy farmers in England, Scotland and Ireland.

Dairy Crest, which started in the 1960s as a butter and cheese brand of the Milk Marketing Board, now is a commercially-focused business with four main consumer brands and 400 British dairy farmer suppliers. The company boasts that its Cathedral City Cheddar, made in its creamery in Cornwall, England, is the United Kingdom’s leading cheese brand.

First Milk, based in Scotland, is a major dairy company owned by British family farms. Its product line includes Cheddar and regional cheeses, dairy ingredients, fresh milk and sports nutrition products. Its creameries on the Mull of Kintyre and Isle of Arran in Scotland, the English Lake District and the southwest tip of Wales produce a range of Cheddars, Red Leicester and Double Gloucester.

Milk producers formed United Dairy Farmers after abolition of Northern Ireland’s Milk Marketing Board in 1995 to provide a cooperative to process and market their farmers’ milk. Dale Farm, which the cooperative acquired in 2001, processes and markets a wide range of dairy products for domestic and international markets at its six plants throughout Northern Ireland, England and Scotland.

Other major dairy processors in the region include Arla Foods UK and Müller Wiseman Dairies in the United Kingdom, and Glanbia, Kerry and Ornua in Ireland.

• Cheese Renaissance

In addition to its large processors, the British Isles have experienced a Renaissance of sorts in farmhouse and specialty cheese over the past 20-30 years, led by increased interest by consumers as well as cheesemakers.

Jaap de Jonge, owner of Jongia UK, which provides equipment for small-scale cheesemakers, says he has seen many people leaving various professions to start up small cheesemaking businesses.

“There are so many teachers, doctors, accountants or people that have retired who buy 20 goats and decide they want to make cheese,” he says. “They pop up, one a week I would say.”

Many of these do cheesemaking as a “hobby job,” de Jonge says, though some have grown and become more established.

Roddy Wilde, business development manager for the Scottish Dairy Brand, says he has seen Scottish cheesemakers getting quite inventive.

“There has been a Renaissance in cheesemaking since the 1980s,” he says. “We have whiskey cheeses, with single-malt whiskeys washed onto the rind of the cheese. We have some great smoked cheeses as well ... cheesemakers are experimenting more with different ages and styles.”

Hinds says many of the newer cheesemakers are steering more toward varieties that are not traditional to the British Isles, using goat’s or sheep’s milk and making continental-style cheeses, emulating recipes from other parts of Europe.

“They’re expanding the British range to be more comprehensive, covering different varieties that exist in the cheese lexicon that previously weren’t produced in the UK 30 years ago, whether it’s a Brie, Camembert, washed-rind, goat’s or sheep’s milk cheese,” Hinds says. “It’s quite a strong phenomenon.”

Hinds says he foresees continued increases both in farmhouse cheesemakers and the number of varieties available.

“There is a market growing for it that will create demand and opportunity,” he says. “Every year, there are more farmhouse cheesemakers than the year before. I see more people going into it and don’t see it being saturated by any stretch.”

• Protected varieties

The British Isles are home to 17 protected designation of origin (PDO) and protected geographical indication (PGI) cheeses registered by the European Commission. The most well-known of these is Stilton, while others include Single Gloucester, Yorkshire Wensleydale and Orkney Scottish Island Cheddar.

Stilton has been made for generations in the three English counties of Leicestershire, Derbyshire and Nottinghamshire. It is available in a white version and the more famous Blue-veined version, and the cheese must be made with pasteurized milk, according to the PDO product specifications, which were enshrined in legislation in 1996.

“A whole Stilton is about 8 kilos — it’s a big, tall cheese. That’s very specific to British cheeses,” says Joe Schneider, cheesemaker and co-founder of Stichelton dairy in Nottinghamshire, England. “They were developed in a different way since they had to travel. Taller, harder varieties could sit on a wagon for a couple of weeks when they went down to London.”

Schneider adds that Blue Stilton is very different from French Blue cheese varieties in its shape and how it’s salted.

“There is no other Blue cheese I can think of in the world that is close to it,” he says. “It starts out as a semi-hard cheese and breaks down. It’s unique in its texture and flavor as well. It’s not a very gloopy Blue like Gorgonzola, but it does have a lovely creaminess.”

Today, there are six cheesemakers in Derbyshire, Nottinghamshire and Leicestershire counties licensed to produce PDO Blue Stilton, according to the Stilton Cheesemakers’ Association.

Stichelton Dairy in 2006 became the first farmhouse cheesemaker since the 1930s to produce a Stilton-style cheese, and the first since the late 1980s to do so using raw milk. However, since PDO Stilton is required to use pasteurized milk, the revived raw milk version could not use the name “Stilton.” Instead, Schneider and co-founder Randolph Hodgson chose the name “Stichelton,” a 12th-century form used for the village of Stilton.

Schneider, who has been fighting to allow raw milk to be used under the PDO, says even without the Stilton name, Stichelton has gained the support of many cheese shops and customers who appreciate the traditional cheesemaking techniques.

“Anyone at that end of the cheese world, selling regional and farmhouse cheeses, will recognize it’s the king of English cheeses and fantastically unique,” he says.

While Stichelton Dairy limits its output to preserve the quality and character of its cheese, it does make enough to meet some demand overseas in markets including the United States, New Zealand, Italy, Spain and other European countries, Schneider says.

• Overseas markets

Other cheeses and dairy products from the British Isles also are finding success overseas, particularly as recent initiatives have expanded global presence and recognition.

The Irish dairy cooperative Ornua, the country’s largest exporter of Irish dairy products, earlier this year opened a new cheese manufacturing facility in Saudi Arabia and also acquired Shanghai-based cheese and dairy manufacturer Ambrosia Dairy. Over the last couple years, Ornua also has invested in acquisitions and significant infrastructure development in Africa, China, Germany, Ireland, Spain, the UK and the United States. Ornua says its Kerrygold butter was the No. 3 branded butter in U.S. sales volume last year and the No. 1 butter brand in Germany. The cooperative reports its cheeses also are performing strongly in U.S. and overseas markets.

Last year, the Scottish government unveiled a new Scottish Dairy Brand and logo to help boost the profile of Scottish dairy products overseas. The brand made its market debut earlier this year in the United States and will target Canada later this year, as well as Western European markets, the Middle East and Asia in the future.

Wilde says there are a lot of small producers making a variety of different cheeses in different regions in Scotland, and the Scottish Dairy Brand is composed of the best and most export-capable of these products. Among those highlighted during June’s Summer Fancy Food Show in New York were Connage Dunlop — a traditional clothbound cheese made by Connage Highland Dairy from a recipe dating back to 1668; Orkney Smoked Red, a 14-month double-smoked Cheddar from the Orkney Islands, where The Island Smokery has been producing this cheese for the past 10 years; and First Milk’s Mull of Kintyre brand Cheddar from the historic Campbeltown Creamery, which has been producing cheese since 1923 on Scotland’s Kintyre Peninsula. These cheeses will be distributed in the United States by Atalanta.

“We have some of the best dairy pastures in the world because of our climate. We often complain about it raining a lot, but it’s great for milk, dairy and cheese,” Wilde says. “We’re a small nation, but I think that makes us quite interesting, an exciting addition to deli counters around the world.”



Settlement announced in
herd retirement lawsuit

September 9, 2016

SAN FRANCISCO — A settlement agreement has been reached in a class action lawsuit filed against the National Milk Producers Federation (NMPF) and a number of cooperatives regarding NMPF’s Cooperatives Working Together (CWT) herd retirement program.

The antitrust lawsuit, filed in 2011 against NMPF/CWT, Dairy Farmers of America, Land O’Lakes, Dairylea Cooperative and Agri-Mark, alleged that CWT and its members engaged in a nationwide conspiracy to limit the production of raw farm milk by prematurely slaughtering cows in order to illegally increase the price of milk and other fresh milk products. The defendants denied any wrongdoing or liability for the alleged claims.

“Our CWT leadership team, with support from the CWT membership, has worked diligently to put this legacy issue behind us,” says Jim Mulhern, president and CEO, NMPF. “Settlement of this litigation is the most sensible and responsible course of action to maintain the current CWT Export Assistance program and allow us to focus on the future.”

Mulhern notes that the court has found no antitrust violation, and CWT makes no admission of wrongdoing in the settlement. He adds that the herd retirement program at issue in the litigation has long since been terminated by CWT.

Under the terms of the agreement, CWT will pay $52 million to the plaintiff class in a combination of cash and in-store loyalty cards to be used for the purchase of fresh milk products. Class members eligible for payment from the settlement include those who have purchased milk or other fresh milk products for their own use while a resident of Arizona, California, the District of Columbia, Kansas, Massachusetts, Michigan, Missouri, Nebraska, Nevada, New Hampshire, Oregon, South Dakota, Tennessee, Vermont, West Virginia or Wisconsin from 2003 to the present. The law firm of Hagens Berman Sobol Shapiro LLP represents the class.

The U.S. District Court of Northern California will hold a final approval hearing Dec. 16 to consider whether to approve the settlement as fundamentally fair, adequate and reasonable, dismiss the lawsuit and enter judgement; or to deny the settlement and require the lawsuit to continue. The court also will consider the request of class counsel for an award of attorney’s fees and other costs that would be deducted form the settlement fund.


FAPRI releases baseline update for ag markets

September 9, 2016

COLUMBIA, Mo. — The Food and Agricultural Policy Research Institute (FAPRI) recently released an update of its 2016 long-term annual baseline report delivered to Congress March 10.

FAPRI, which has research centers at the Center for Agricultural and Rural Development at Iowa State University and the Center for National Food and Agricultural Policy at the University of Missouri-Columbia, uses comprehensive data and computer modeling systems to analyze the complex economic interrelationships of the food and agriculture industry. (For a summary of the March report, see “FAPRI annual baseline examines cow numbers, dairy prices over the next several years” in the March 11, 2016, issue of Cheese Market News.)

FAPRI notes the update released last week reflects information from USDA’s August 2016 “Crop Production” report. It assumes that current agricultural and biofuel policies will continue and that the global economy will evolve as forecast by IHS Global Insight in July 2016.

The baseline update notes that increased supplies of beef, pork, poultry and milk have pushed prices lower. Lower retail prices for meat and dairy products mean that average consumer prices for food consumed at home are projected to decline in 2016, and overall food price inflation is just 0.9 percent. The report adds that food inflation begins to pick up again in 2017 and exceeds 2 percent in 2018.

According to the update, U.S. milk production now is projected to reach 212.1 billion pounds in 2016, up from 208.6 billion pounds in 2015. FAPRI projects milk production will steadily increase throughout the projection period to 227.1 billion pounds by 2021.

The number of U.S. dairy cows is projected to reach 9.33 million head in 2016, up from 9.32 million head in 2015. Cow numbers are expected to hold fairly steady in the next few years, FAPRI says.

Meanwhile, milk prices, which are projected to fall from last year’s average of $17.21 per hundredweight to $16.09 in 2016, will gradually increase for the most part, reaching $18.17 per hundredweight by 2021, FAPRI says, still down from 2014’s average of $24.07.

American-type cheese production is projected to reach 4.75 billion pounds in 2016, up from the past two years, FAPRI says. American cheese production is estimated to increase throughout the projection period to reach 5.08 billion pounds by 2021. Other U.S. cheese production is projected to increase from 7.14 billion pounds in 2015 to 7.34 billion pounds in 2016 and steadily increase to 7.90 billion pounds in 2021, the baseline update says.

Prices for 40-pound cheese blocks at the Chicago Mercantile Exchange (CME) are projected to average $1.55 per pound this year, down from $1.61 in 2015 and $2.11 in 2014, FAPRI says. Cheese prices are then projected to rise to $1.63 by 2021.

U.S. butter production is projected to increase throughout the projection period from 2.00 billion pounds in 2016 to 2.19 billion pounds by 2021, the report says. FAPRI says CME butter prices are projected to average $2.14 per pound in 2016, up from $2.09 in 2015 but down from $2.16 in 2014. FAPRI projects butter prices will decline throughout the baseline period to $2.00 per pound by 2021.

FAPRI says U.S. production of nonfat dry milk (NDM) is projected to reach 2.27 billion pounds in 2016, unchanged from 2015 and down from 2.31 billion pounds in 2014. NDM production is projected to increase to 2.59 billion pounds by 2021, the report says. CME NDM prices are projected to average $0.84 per pound in 2016, down from $0.94 in 2015 and $1.74 in 2014.

To view the baseline update, visit


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Today's Cheese Spot Trading
September 27, 2016

Barrels: $1.4600 (-2)
Blocks: $1.5350 (-1)

Click here for more market activity
Cheese Production
U.S. Total July
1,016.711 mil. lbs.

Milk Production
U.S. Total August
17.735 bil. lbs.

Guest Columnist

The ‘ONEDOC’ initiative

Edward Zimmerman, The Food Connector

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