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Ky Milk Matters January February 2021



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Ky Milk Matters January February 2021

  1. 1. January - February 2021 • KDDC • Page 1 KDDC is supported in part by a grant from the Kentucky Agricultural Development Fund Milk Matters J a n u a r y - F e b r u a r y w w w. k y d a i r y. o r g K E N T U C K Y Supported by Milking Practices Influence Somatic Cell Count page 6 Kentucky Farm Bureau Strengthens Dairy Policy page 9 All American Nominations page 16 Milk 4.0 Focuses on Data I n today’s world, data is all around us and it is changing the way the world runs. Companies like Amazon, Google, Facebook, and Netflix all use data to increase efficiencies. The dairy industry is no exception to this data revolution. From ration balancing, feed monitoring, DHIA records, new monitoring technologies, smartphone applications, novel software programs, andgenomics,theoptionsforimproving the profitability of your dairy operation through data are everywhere. This digital transformation has been referred to as the 4th industrial revolution, often shortened to 4.0. When it was introduced, the original KDDC MILK (Milk Incentive Leadership for Kentucky) was the first of its kind. This program was very successful in helping dairy producers in our state and has been imitated by other dairy organizations. A series of events led to the need to create a new MILK program. As we started developing the program, it was clear that many of the next opportunities we wanted to lead the industry in are centered around data. And, like it’s predecessor, this program is a big leap forward. Thus, we have named the program MILK 4.0---to capture the new program’s focus on data and the leap forward in progressing the Kentucky dairy industry we all love. MILK 4.0 focuses on genomics, pregnancy rate, somatic cell count, and financial analysis. All of these data-based programs will help progress your dairy operation. We are looking forward to continuing this journey together.
  2. 2. January - February 2021 • KDDC • Page 2 KDDC is supported in part by a grant from the Kentucky Agricultural Development Fund 2020 KDDC Board of Directors & Staff Executive Committee President: Freeman Brundige Vice President: Charles Townsend, DVM Sec./Treasurer: Tom Hastings EC Member: Tony Cowherd EC Member: Greg Goode EC Past President: Richard Sparrow Board of Directors District 1: Freeman Brundige 731.446.6248 District 2: Josh Duvall 270.535.6533 District 3: Keith Long 270.670.1388 District 4: Bill Crist Jr. 270.590.3185 District 5: Tony Compton 270.378.0525 District 6: Mark Williams 270.427.0796 District 7: Greg Goode 606.303.2150 District 8: Steve Weaver 270.475.3154 District 9: Jerry Gentry 606.875.2526 District 10: Terry Rowlette 502.376.2292 District 11: Stewart Jones 270.402.4805 District 12: John Kuegel 270.316.0351 Equipment: Tony Cowherd 270.469.0398 Milk Haulers: Mike Owen 270.392.1902 Genetics: Dan Johnson 502.905.8221 Feed: Tom Hastings 270.748.9652 Nutrition: Dairy Co-op: Stephen Broyles 859.421.9801 Veterinary: Dr. Charles Townsend 270.726.4041 Finance: Todd Lockett 270.590.9375 Heifer Raiser: Bill Mattingly 270.699.1701 Former Pres.: Richard Sparrow 502.370.6730 Employee & Consultants Executive Director: H.H. Barlow 859.516.1129 DC-Central: Beth Cox PO Box 144, Mannsville, KY 42758 859.516.1619 • 270-469-4278 DC-Western: Dave Roberts 1334 Carrville Road, Hampton, KY 42047 859.516.1409 DC-Southern: Meredith Scales 2617 Harristown Road, Russell Springs, KY 42642 859.516.1966 DC-Northern: Jennifer Hickerson PO Box 293, Flemingsburg, KY 41041 859.516.2458 KDDC 176 Pasadena Drive • Lexington, KY 40503 KY Milk Matters produced by Carey Brown President’s Corner Freeman Brundige T his word best describes the start of 2021. All of us have far more questions about the future than we have answers. How much longer do we have to deal with a pandemic and all the problems it is causing? Will consumers buying habits cause radical changes in what products need to be available in stores, markets, and hopefully restaurants? Volatility in futures markets keeps us and the so-called experts guessing on what milk and feed prices could be. A big percentage of the milk in the Southeast is being marketed by one agency, with most farmers having no other option. There has been a total leadership change in our federal government. What changes will they make in regulations and input costs? Exports have become the “golden" hope and predicting them has become a moving target. But if you don’t have a positive attitude then you would probably not be in the dairy business. It takes a lot of courage and faith. We have an excellent product that still proves to be a great source of nutrition and value. Hopefully, people recognized these qualities thru this crisis. KDDC is working on several fronts to try and ensure better futures for our farms. The new MILK 4.0 program addresses several avenues to improve profitability both short and long term. We are working on milk pricing issues on several different levels, in conjunction with other states in the southeast and on the national level with the Kentucky Farm Bureau. We will try to work with the above groups and our state and national legislators during this formation of the next farm bill. Your input is always needed and welcomed. Uncertainty: the state of being uncertain, times of uncertainty and danger
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  4. 4. January - February 2021 • KDDC • Page 4 KDDC is supported in part by a grant from the Kentucky Agricultural Development Fund Executive Director Comments H H Barlow H allelujah!! 2020 is gone and 2021 has to be better. I long for the day of no more masks, no more zoom meetings and no more COVID. As we enter 2021, uncertainty is still very prevalent in our lives. The only thing I’m confident of is change will be significant as we navigate 2021. In the dairy world, feed prices appear to be our largest challenge. Thankfully, many producers did contract their feed before the large increases in commodity prices. However, many did not. As farmers, we are in a global market and rain in Brazil is almost as important as rain in Illinois. Feed prices and carryover stocks of corn and soybeans seem to be as unpredictable as milk prices. Most economists are predicting similar overall milk prices to 2020 averages without the tremendous fluctuation. 2020 experienced the lowest and highest milk prices since 2000 and only three months apart. Exports look to be strong for 2021. We just have huge amounts of butter in storage that needs to be sold. The closing of restaurants really punished butter sales. Government intervention in milk prices doesn’t appear to be as significant in ’21, even though we are starting out the year with another food assistance program. If the country continues to open and people get the vaccines, I believe government help will cease. The free food programs were a large part of KDDC’s activity last year. Giving away those boxes of milk products was very rewarding and helpful to a lot of people. Meredith Scales described it as a humanitarian effort. KDDC managed 33 semi-load distributions, all in different locations. People were extremely appreciative and KDDC got tremendous positive exposure for the effort. RFD-TV even picked up one of our events so we had nationwide coverage. KDDC’s major effort this year will be the rollout of several new initiatives for our dairymen. After days of staff meetings and industry input, like Dr. Jeffrey Bewley, we have finalized the new programs being offered. The purpose of these programs is to increase the profitability of your dairy operation. As individual dairymen, we have very little control over milk prices and commodity feed prices, but we all can improve things in our herds to increase profit. Our areas of concentration will be genetics, with special emphasis on genomics, reproduction with emphasis on improving pregnancy rate, and milk quality, with emphasis on lowering somatic cell count. Also, we are including beef- on-dairy, with emphasis on raising the value of bull calves and heifers not needed for replacement. And finally, dairy enterprise financial analysis, to identify bottlenecks that hinder profitability. I’m happy to report that we are having a dairy partner’s meeting February 24 even though the planning has been challenging. It is our belief that we should meet for at least one day. This year’s meeting will have fewer speakers and our award’s program will be at lunch instead of the evening banquet. Virtual option is available for those who can’t attend in person. To launch our MILK 4.0 program, we are planning on a three-day road show March 23 in Hopkinsville, March 24 in Campbellsville and March 25 in Glasgow. These locations have been chosen to make attendance easier for our dairymen. We have scheduled out-of-state speakers to explain the benefits of our new initiatives. To introduce our new beef-on-dairy initiative, we are planning a June meeting with a tour. We started our young dairymen fellowship and education meetings in October 2020. KDDC’s board of directors are committed to involving more young producers in our organization. We are planning a series of these meetings in the summer to encourage more participation and leadership in KDDC. Totally new for 2021, KDDC has been awarded two grants. One is working with the University of Tennessee on value- added dairy products. The other one is working with Kentucky Center for Agriculture and Rural Development on value added projects, which can be either dairy only or dairy beef. Details and specific information on these grants will be forthcoming. They will definitely provide opportunities for some of our producers. Because of the extreme volatility and inequitable milk pricing nationwide, there is a national initiative to make adjustments to the Federal Order program. KDDC is working with other southern states and the American Farm Bureau dairy group to make recommendations and get some positive changes implemented. Hearings have been proposed, but not scheduled as of yet. We certainly plan to be involved. For example, a change in touch base requirements could make it more difficult for milk to come to the southeast pulling dollars out of our pool. There are also plans to start working on the next U.S. farm bill. As a non-profit organization, KDDC cannot lobby, but we can represent our membership by offering input and education to our legislators on dairy needs in the future. This year will be extremely busy for your KDDC staff with new programs and opportunities to pursue. We are always available to talk by phone and visit your operations when needed. We consider it a privilege and a responsibility to assist our producers and allied industry as we strive to make 2021 successful for all of us. So on these cold mornings, put several extra slabs of butter on those biscuits, waffles and pancakes. Keep your chin up, have faith in God and we’ll have a good year.
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  6. 6. January - February 2021 • KDDC • Page 6 KDDC is supported in part by a grant from the Kentucky Agricultural Development Fund Milking Practices Influence Somatic Cell Counts Donna M. Amaral-Phillips, University of Kentucky Dairy Extension Professor and Nutritionist W hen it comes to maintaining a low herd somatic cell count, continuously practicing sound milking procedures are part of an effectively implemented, on-farm milk quality plan. Dairy managers understand the importance of following proven milking procedures, but the component that often gets overlooked is translating the importance of continuously and consistently completing these practices to those actually milking the cows. When these procedures are routinely reviewed or re-reviewed with employees or other family members, an increased understanding can lead to a higher rate of correctly implementing these practices, avoiding the development of bad habits, and the ability to maintain a low somatic cell count. Even herds using robots to milk their cows need to review whether the robot is correctly completing each of these components associated with milking practices. “Clean” Environment Reduces Exposure to Mastitis-Causing Bacteria Providing a comfortable, dry environment for cows to rest reduces the exposure of teat ends to mastitis-causing bacteria. A cow’s udder should be clean and not manure-laden. Not only does this reduce mastitis, but total milking time is improved as one does not need excessive time to clean cows before attaching the milking unit. For freestall and tiestall barns, this means cleaning out the manure at the back of stalls at each milking and replacing bedding as needed to keep udders clean and dry. For compost bedded barns, the bedding surface needs to remain dry. Thus, the bedding area needs to be tilled twice daily and new sawdust added when the moisture content exceeds 40 to 60%. On pastures, muddy areas and congregation around trees needs to be kept to a minimum. Teat Disinfectant (Pre-dip) Needs Time to Work Effectively applying pre-dip helps in the control of environmental pathogens that may cause mastitis. Pre-dip needs to be applied to all 4 teats with at least the lower ¾ of the teat being completely covered. The germicide found within the pre-dip needs to remain on the clean-looking teat for at least 30 seconds to be effective. Please remember that the germicide is not effective on “dirty” teats which are manure-or mud-laden. After applying pre-dip and allowing it to remain on the teats for at least 30 seconds, the pre-dip needs to be removed using a single service paper or washed cloth. Special attention should be directed towards cleaning the teat ends. Adequate Prep Needed for Milk Let-down For efficient milk let-down, the milking unit should be attached within 1 to 2 minutes of the start of prepping the cow for milking. Within 30 seconds of touching and/or cleaning the teats, oxytocin is released into the blood stream, which in turn results in milk flowing from the cells that synthesize milk, known as alveoli, into the ducts and cisterns of the mammary gland. Less than 20% of the total milk production is stored in the gland and teat cisterns and, thus, the majority must be “released” from the alveoli cells. For efficient oxytocin release, cows must not be frightened during the milking process and a repeatable milking procedure needs to be followed with the milking units attached within 2 minutes of the start of prepping the cow. Attaching the milking units too soon or too late will result in a delay in milk let-down and possible damage to the teat ends by the milking machine. Fore-stripping Cows Helps with Milk Let-down Stripping a few streams of milk prior to attaching the milking unit serves a multitude of purposes. First, fore-stripping stimulates milk let-down and flushes bacteria from the teat canal. Secondly, milk which is discolored, watery, or contains flakes or clots can be detected and diverted from saleable milk. Then, an action plan for the cow can be developed to address the issue. Fore-stripping can occur before or after pre-dip is applied. Don’t forget to Post-dip An effective post-dip should be applied to all 4 teats immediately after removing the milking unit, such that the bottom ¾ of the teat is covered. In robotic milking systems, managers need to check often that robots are applying post-dip adequately to all quarters of several cows in all robots and, if necessary, adjust the calibration for proper coverage. Post- dipping kills a significant number of bacteria on the teats, helps heal skin lesions, and optimizes teat skin condition. All of these factors help reduce the chances of bacteria entering the mammary gland. Post dipping is especially effective at reducing bacteria that are spread from cow to cow at milking time, such as Staph. aureus. Consistent application of post-dip helps reduce new infections, but will not reduce or eliminate existing infections. Teat dips should be stored in a cool, dry area and not allowed to freeze. Dip cups should be emptied and cleaned after every milking or if they become contaminated. Completion of All Steps Consistently Is Important Sound and consistent milking practices are important components in achieving a low herd somatic cell count. These milking practices include, but are not limited to, providing an environment where cows stay clean, using an effective pre-dip to help in the control of environmental mastitis, attaching the milking unit within 2 minutes from the start of cow prep, fore- stripping cows, and at the end of milking applying a post-dip. Routinely reviewing these practices with those actually milking the cows is important for effective milk let-down, efficient milking times, and maintaining lower somatic cell counts in milk.
  7. 7. January - February 2021 • KDDC • Page 8 KDDC is supported in part by a grant from the Kentucky Agricultural Development Fund Georgia Milk Producers Conference Summary HH Barlow I t is exciting to report on dairy farmers getting together off the farm. A good group of 200 producers, exhibitors and industry personnel gathered in Savannah, Georgia March 18-20. Everyone said it was just good to see fellow dairymen and resist the fear and lockdown that COVID-19 had created. The conference centered around information that we all need for the future success of the dairy industry. Economic predictions for 2021 milk prices, dairy exports and government programs were stated. Dixie Dairy economist, Calvin Covington, predicted prices in 2021 overall will be similar to 2020 unless another major government program is instituted. New technology was discussed for producers regarding milking equipment, on-farm quality testing, and the most interesting new technology of putting worms in your manure lagoon. The worms eat the manure, lower the nitrogen and phosphorus levels and create worm casings, which can be sold as organic fertilizer. These types of advance technologies are coming to U.S. dairy producers. Discussion was held about environmental factors such as methane production. A new initiative has been started by Dairy Management Inc. for dairies across the U.S. to become carbon net zero by 2050. This initiative causes great concern for smaller dairy producers that do not have the capability to have a methane digester or the tools and equipment needed to process our animal waste. Many of these ideas are tremendously expensive. The new emphasis of dairy beef was highlighted by two speakers. One focused on beef genetics and the other one on carcass size and quality. To maximize dairy beef value, the correct size carcass has to be created for processing, e.g., an animal over 58 inches is too tall. The beef-on-dairy is a new technology that can create extra profits for dairies small and large through their bull calves. The ten Kentucky attendees gave the conference high marks for information, and especially the fellowship and exchange of ideas with fellow dairymen. Dairy Revenue Protection (DRP) Is Here! This recently released USDA product (DRP) is designed to protect dairy farmers from the decline in quarterly revenue from milk sales. Contact us today for more information about protecting one of the biggest risks to your operation. In Business Since 1972 1-800-353-6108 We are an equal opportunity provider
  8. 8. January - February 2021 • KDDC • Page 9 KDDC is supported in part by a grant from the Kentucky Agricultural Development Fund Kentucky Farm Bureau’s 101st Annual Meeting “Together We Grow” served as this year’s theme T he 2020 Kentucky Farm Bureau (KFB) Annual Meeting took on a new look with all components of the meeting being held virtually due to COVID-19 restrictions. But the purpose of the meeting remained the same as KFB leadership conducted the business of the organization, which serves more than 460,000 members. KFB President Mark Haney said while holding the meeting in such a way was disappointing, no pandemic was going to stop the organization from fulfilling its mission to serve members and the agricultural communities throughout the state. “We saw many changes take place throughout 2020 due to safety regulations and restrictions, but our farm families never stopped,” he said. “Those outside the agricultural world discovered what we have known all along: how essential our industry is to everyone, everywhere. Many thanks go out to our state commodity and governmental leaders, as well as our KFB staff who have all worked so hard to ensure the needs of our members and citizens of the Commonwealth have been met during these unprecedented times.” Haney added that KFB has served as the Voice of Kentucky Agriculture for more than 100 years and has never failed to conduct an annual meeting regardless of worldly events. “As an organization, we have come through depressions, recessions, wars and turbulent times in the agriculture industry, and we never let any of that stop us from our duties in this organization,” he said. “We’ll see better days ahead and will continue to move forward, as we always have, in providing the best services to our members and the best advocacy for our agriculture industry.” The meeting included the business of board elections, approving of policy and priorities, announcement of competition winners, and guest speakers that included American Farm Bureau Federation President Zippy Duvall, and Kentucky Agriculture Commissioner Dr. Ryan Quarles, both of whom spoke remotely. Virtual guests also heard from KFB leadership throughout the three-day event. Duvall said the theme for this year’s annual meeting is so appropriate as it relates to working together with KFB. “I think, as we have gone through this pandemic, we have grown together, became stronger together and we set forth the perfect example to this country that when you (do) work together how strong you can be and how much you can accomplish,” he said. “It has been an honor to work with the leadership team at KFB, and I value their opinions each and every day.” Quarles said rarely does a day go by that he is not talking to or working with someone from Farm Bureau on issues related to agriculture. “This year put a lot of tests on our food supply systems and other issues across our Commonwealth, and the strength of KFB and its coordination with the Kentucky Department of Agriculture really shined through during this pandemic.” Quarles also noted KFB’s grassroots way of implementing policy which starts from the ground up, something he called a hallmark of good governance and democracy. Kentucky Farm Bureau Strengthens Dairy Policy K entucky Farm Bureau participated in the American Farm Bureau (AFBF) virtual delegate session in January to adopt national policy and direction for 2021. One very important segment in that effort was strengthening dairy policy supporting reforms to the Federal Milk Market Order (FMMO). Dairy has always been a significant focus of policy, but in 2019 AFBF President Zippy Duvall appointed a FMMO Dairy Working Group to review the current dairy situation, identify specific problem areas where change is needed and develop effective policy recommendations to focus efforts on addressing those issues. This fits nicely with Kentucky Farm Bureau’s mission statement to “identify problems, develop solutions, promote economic success and enhance the quality of life for all.” Dr. John Newton, Chief Economist for AFBF noted that Farm Bureau delegates adopted two key dairy policy statements and renewed an effort to continue pushing for dairy reforms. First, delegates adopted the following policy to support “Changes to the Federal Milk Marketing Order program to reduce or eliminate negative Producer Price Differentials and reduce the economic incentives to de-pool milk including but not limited to modifications to the Class I milk pricing formula, adjustments to pool qualification criteria and stricter limitations on producer milk receipts in months following the de-pooling of milk.” We need to revisit the Class I formula that was changed in the 2018 farm bill that has resulted in significant loss of revenue for dairy farmers. There are a variety of proposals being considered across the industry including going back to the higher-of, adjusting the current average formula, or basing class I milk prices on class III alone. Now Farm Bureau policy is flexible enough to find consensus on an alternate approach. De-pooling and qualification criteria differ on an order- by-order basis and would need to be changed individually unless the industry seeks national changes or seeks mandatory pooling of all milk. Secondly, Farm Bureau policy supports “A change to bloc voting that would require cooperatives to give notice to members of their intended vote and the member’s right to opt out of that vote and vote independently and confidentially.” By striking language that opposed bloc voting by cooperatives this means we support cooperatives being able to bloc vote but want to see clear options for farmers to be able to opt out of that vote and cast individual and confidential ballots. Engaging all dairymen is important and ensuring a representative vote by enough members is critical to making necessary changes. The AFBF Board of Directors also directed staff to re-convene the FMMO dairy working group for 2021. Like the 2019 effort, this will involve AFBF dairy farmer members working on ways to improve milk pricing in the United States; especially as we begin the process of reauthorizing a new farm bill that includes significant dairy policy. Working together, some aspects of FMMO reform are clearly possible in a new farm bill, but others will take time. The one thing that is certain is that it will take a fully engaged effort to enact the changes necessary.
  9. 9. January - February 2021 • KDDC • Page 10 KDDC is supported in part by a grant from the Kentucky Agricultural Development Fund KDDC Board Member Spotlight District 10 Director Stewart Jones Stewart along with his wife Mary are co-owners and founder of Coleman Crest Dairy located in Marion County. Stewart along with his wife and children operate an approximate 300 cow herd and grow crops on around 700 acres also. Stewart has a passion for the dairy business and actively engages in opportunities to promote its future. Stewart and his family are known for showing their Holstein cattle at local, regional and state levels with the CCD-Jones prefix. Stewart values his time on the farm being spent with his children and grandchildren. Financial Institution Director Todd Lockett Todd grew up in Hart County, KY in the Pascal community on his family’s dairy farm, which operated from 1981-2016, producing milk, hay, and tobacco. The family milked about 50 cows and practiced rotational grazing. After graduating high school, Todd attended Western Kentucky University where he received a Bachelor’s Degree in Agriculture, and was awarded the Animal Science Student of the Year in 2008. After graduation, Todd accepted an employment opportunity with Southern States Glasgow Cooperative working directly with producers, specializing in dairy nutrition and tobacco & greenhouse production. After 5 years with Southern States, Todd changed his career trajectory and went to work for Farm Credit Mid-America, training in Ag Finance and again specializing with many of the area dairy farmers as clients. Presently, Todd works for South Central Bank, Inc. based in Glasgow, KY as an Ag Lender. He operates a registered Red Angus Beef Herd, serves as Treasurer of the Hart County Cattlemen’s Association, and still works with many area dairy farmers. Todd has often said, no matter what part of agriculture he chooses to work in, his heart will always remain in dairy and he is very excited and thankful for the opportunity to work with the KDDC Board and it’s many members across the state. Cowherd Equipment & Rental Inc. Cowherd Equipment & Rental, Inc. Cowherd Equipment & Rental, Inc. 1483 Old Summersville Rd. 1483 Old Summersville Rd. Campbellsville, KY 42718 Campbellsville, KY 42718 Office 270-465-2679 Office 270-465-2679 Tony 270-469-0398 Tony 270-469-0398 Vince 270-469-5095 Vince 270-469-5095 Cowherd Equipment & Rental, Inc. For More Information: Cowherd Equipment & Rental, Inc. 1483 Old Summersville Rd. Campbellsville, KY 42718 Office 270-465-2679 Tony 270-469-0398 Vince 270-469-5095 Penta 4030 Tire Scraper J&D Head Locks Hagedorn 5440 Manure Spreader Silage Defacer Penta 4930 Cowherd Equipment & Rental, Inc. For More Information: Cowherd Equipment & Rental, Inc. 1483 Old Summersville Rd. Campbellsville, KY 42718 Office 270-465-2679 Tony 270-469-0398 Vince 270-469-5095 Penta 4030 Tire Scraper J&D Head Locks Hagedorn 5440 Manure Spreader Silage Defacer Cow For from o ha C 148 Ca • Bou Che • Cho • Bou • J&D • IBA • Mu Penta 4930 • SC • Up Cowherd Equipm F Cowhe 14 C Penta 4030 Tire Scrap J&D Head Locks Silage Defacer Roto-Mix Mixers Tire Scraper Hagedorn 5440 Manure Spreader Penta 4030 J&D Head Locks
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  11. 11. January - February 2021 • KDDC • Page 12 KDDC is supported in part by a grant from the Kentucky Agricultural Development Fund Dixie Dairy Report January 2021 Calvin Covington Class milk prices. The graph below, showing 2020 monthly federal order class milk prices, provides an overview of the 2020 pandemic year. The year began with relatively strong milk prices, the January Class I Mover was almost $4.00/ cwt. higher than a year earlier. Then as the pandemic hit, prices declined in May (II, III and IV) and June (Mover) to the lowest levels since 2009. Then USDA’s Food Box program started, and lifted the Class III price to the second highest on record high in June and then record highs in July and November. The peaks and valleys in the Class III prices correlate to when a round of Food Box purchases was coming to an end and another round announced. We estimate USDA purchased the equivalent of about 1.75% of 2020 milk production through the Food Box program. We estimate about 70% of the milk equivalent purchased was in the form of cheddar cheese, thus the strong Class III prices. As the graph depicts, Class II and IV prices only recovered, modestly, from the May low. Due to the change in the Class I Mover calculation, implemented in May 2019, the Mover failed to receive the full benefits of record Class III prices. We estimate from January to November of 2020, the new calculation lowered the Florida blend price $1.11/cwt., Southeast $0.94/cwt. and Appalachian $1.05/cwt. Dairy product prices. December butter and cheese DPSR prices are lower than November while NDM and dry whey are higher. The butter inventory continues to expand with the November inventory 39.4% greater than a year ago. Government restrictions and shutdowns hurt restaurants the most, a major butter user. Cheese took a large decline in December as the Food Box program wound down. Italian cheese sales continue to struggle, similar to butter, food service is a primary user. From July to October 2020 production of Italian cheese is 2.5% lower compared to the same period a year earlier. Generally, Italian cheese is not produced unless there is a market. Strong exports sales continue to lift both NDM and dry whey prices. 2020 MONTHLY FEDERAL ORDER CLASS MILK PRICES ($/CWT.) DAIRY PRODUCTS SALES REPORT (DPSR) PRICES * PROCUCT DEC 2020 NOV 2020 DEC 2019 DEC 2018 ($/lb) Butter $1.4431 $1.4558 $1.9842 $2.2425 Cheese (block) $1.7708 $2.5808 $1.9363 $1.4032 Cheese (barrel) $1.4944 $2.2929 $2.1395 $1.3160 Cheese Weighted Avg. $1.6433 $2.4535 $2.0509 $1.3742 Nonfat Dry Milk Powder $1.0951 $1.0816 $1.2161 $0.9020 Dry Whey $0.4171 $0.3830 $0.3293 $0.4685 *Dairy product prices used to calculate federal order class prices
  12. 12. January - February 2021 • KDDC • Page 13 KDDC is supported in part by a grant from the Kentucky Agricultural Development Fund Milk Prices FMMO 5 January 2021 Class 1 Advanced Price (@3.5%BF) $ 18.54 February 2021 Class 1 Advanced Price (@3.5%BF) $ 18.94 FMMO 7 January 2021 Class 1 Advanced Price (@3.5%BF) $18.94 February 2021 Class 1 Advanced Price (@3.5%BF) $ 19.34 PROJECTED* BLEND PRICES – Base Zones – SOUTHEASTERN FEDERAL ORDERS MONTH APPALACHIAN FLORIDA SOUTHEAST ($/cwt. at 3.5% butterfat) November 2020 $19.72 $21.70 $19.66 December $20.68 $23.16 $21.20 January 2021 $17.54 $19.72 $17.86 February $17.60 $19.68 $17.96 March $17.82 $19.98 $18.37 April $17.96 $20.27 $18.39 * Projections in bold Robust milk production. Since July, milk production is well ahead of a year ago. July-November 2020 milk production is 2.3% higher than the same period in 2019. More milk is due to more cows and more milk per cow. At the end of November, the nation’s dairy herd is estimated at 9.407 million cows, 62,000 more head than a year ago. Through November, 168,700 fewer dairy cows were slaughtered compared to the same period in 2019. Since July, milk per cow is up 1.7%. Of the 24 monthly reporting milk states, production is higher in 17 and lower in 7. Florida has the second lowest July-November production decline (3.8%). Vermont has the lowest. Georgia production is up 0.7% and Virginia up 2.4%. Supply and demand in 2021. The major challenge we see facing milk prices in 2021 is farm milk production exceeding supply. Based on current indicators, we estimate 2% more milk in 2021. On the demand side, domestic demand remains weak, while exports are strong. Through the first ten months of 2020, domestic demand is 0.7% (total solids) lower than the same period in 2019. However, domestic demand would be much lower without USDA purchases. We do not expect USDA purchases to continue in 2021 at the same level as 2020. Through October of last year, export demand is up 15.8% (total solids) and accounts for almost 16% of total dairy demand. Combining domestic and export demand, total demand is 1.6% higher for the first ten months of 2020 compared to the previous year. Milk prices in 2021. USDA’s December outlook projects the 2021 all-milk price $1.65/cwt. lower than 2020. CME futures as of December 31 show 2021 Class III futures averaging $0.95/cwt. lower and Class IV futures averaging $1.98/cwt. higher than 2020. Our 2021 projection show blend prices, in the three southeastern orders, averaging about $0.50/cwt. lower than 2020. If nothing else, last year told us milk price projection are not much more than guesstimates. We see answers to the following questions having the greatest impact on milk prices in 2021: • Will cooperatives and plants implement milk production controls to lower milk supply? Last spring showed dairy farmers can lower milk production if provided the incentive. • Based on 2021 grain futures prices at the end of 2020 (corn $4.65/bushel, soybeans $12.50/bushel, and soybean meal $400/ton), feed costs appear higher in 2021. Higher feed costs mean a lower gross margin. Will this slow production? • How long will it be before the food service sector (40% of dairy sales), recovers, thus lifting domestic demand? • Can the export market expand further and utilize the milk produced beyond domestic demand? The cheaper dollar helps, but production is growing outside of the U.S. as well. • What volume of dairy products will USDA purchase in 2021? It makes a significant impact. Blend prices. We project December blend prices in the three southeastern orders about $1.00/cwt. higher than November. Our 2021 projections have changed little since last month. First quarter 2021 blend prices will struggle. We project a first quarter average about $2.25/cwt. lower than 2020.
  13. 13. January - February 2021 • KDDC • Page 14 KDDC is supported in part by a grant from the Kentucky Agricultural Development Fund 2021 KDDC Board Meeting Dates Please see below the scheduled KDDC board meeting dates. All board meetings are open to producers. Virtual attendance will be available. FEB 24 2021 Installation of new board members/Regular 2PM CST Sloan Convention Center 1021 Wilkinson Trace Bowling Green, Kentucky 42103 MAR 18 2021 Regular 10AM EST Taylor County Extension Office 1143 S Columbia Avenue Campbellsville, Kentucky 42718 MAY 20 2021 Regular 10AM EST Hardin County Extension Office 111 Opportunity Way Elizabethtown, Kentucky 42701 JUL 15 2021 Regular 10AM EST Nelson County Extension Office 317 South 3rd Street Bardstown, Kentucky 40004 SEP 16 2021 Regular 10AM CST Barren County Extension Office 1463 W Main Street Glasgow, Kentucky 42141 NOV 18 2021 Regular 10AM CST Adair County Extension Office 409 Fairgrounds Street Columbia, Kentucky 42728 JAN 4 2022 KDDC Board Planning Meeting 10AM CST Adair County Extension Office 409 Fairgrounds Street Columbia, Kentucky 42728
  14. 14. January - February 2021 • KDDC • Page 15 KDDC is supported in part by a grant from the Kentucky Agricultural Development Fund Kentucky Dairy Short Course W e are proud to announce the dates of the upcoming Center of Kentucky Dairy Short Course. As in the past, this program will consist of three sessions of discussion led by experts within the industry. Due to current constraints and the interest of everyone’s health, the program will be held virtually this year via zoom. While we will miss the in-person discussions, we are hopeful a greater number of individuals are able to participate this year. The dates, topics, speakers, and Zoom links to register for each session are listed below. Each session will start at 10:00 am CT/11:00 am ET February 11th- So I DNA tested my herd…now what? Dr. Jeffery Bewley w/Holstein USA Register for this session here: February 25th- Fungicide application methods and products for corn silage Dr. Kiersten Wise, UK Extension Plant Pathologist Register for this session here: March 4th- Managing for the Invisible Cow, Dr. Donna Amaral-Phillips, UK Extension Dairy Specialist Register for this session here: Classified Ads Comprehensive Nutrient Management Plans (CNMPs). Livestock manure management and water quality BMPs. Ky Division of Water permitting and compliance. Ben Koostra - Professional Engineer and NRCS Technical Service Provider - Lexington - 859-559-4662 Meyer 510 TMR mixers - In STOCK Cloverdale 500 T -TMR mixers - in Stock ESCH DRILLS-7/10/12 ft - IN STOCK HORNING 2/3 row headers in stock Stoltzfus 10 ton Litter spreader $30,000 Gehl R150 skid loader $19,500 Caterpillar 242B skid loader-$19,000 New Holland 790 choppers-@$7500 John Deere 8200 drill $6000 John Deere 3950 Harvestor $10,000 Gehl 8335 feeder wagon $8000 New Idea 363- manure spreader $7500 Artex SB 200- vertical beater- for rental Kemco Bale Wrapper new $29,000 Stoltzfus lime - litter- fert cu 50 $18,500 JD 5085E- loader - 4wd- canopy $33,500 JD 5325 loader- 2 wd- canopy $24,500 Farmco feeder wagons-15 in stock-call Charlie B. Edgington 859-608-9745 To place a classified ad, contact any of the KDDC Dairy Consultants or Carey Brown at (859) 948-1256
  15. 15. January - February 2021 • KDDC • Page 16 KDDC is supported in part by a grant from the Kentucky Agricultural Development Fund Southland Dairy Farmers are excited to begin 2021 as a new sponsor for #TeachKYAg. This sponsorship will include funding for dairy and agriculture programs and materials, as well as, Southland Dairy Farmers being present with the Mobile Dairy Classroom at select #TeachKYAg events. The Kentucky Agriculture and Environment in the Classroom, Inc. works with agricultural, environmental, and educational partners to produce and distribute Kentucky-based and standards- aligned resources and programs that showcase how Kentucky farmers utilize natural resources to produce sustainable food and renewable goods. All lessons and programs can be used as teaching supplements in all subject areas. “We are looking forward to working with #TeachKYAg, as their mission aligns closely with ours and supports teaching agriculture and nutrition to America’s youth,” said Jim Hill, CEO of Southland Dairy Farmers. Southland Dairy Farmers Join as Kentucky Agriculture and Environment in the Classroom Sponsor Congratulations to the All American Nominations from Kentucky Fairdale Farms LLC Fairdale Carter Cameo ETV- Brown Swiss Fairdale Famous Whiskers-Brown Swiss Fairdale Renegade C Jessie ETV- Brown Swiss Kruses GK Thunder Jaclyn- Brown Swiss WF Cayenne Nicole ET- Brown Swiss Pine-Tree Rich Alli 7462 ETV-Brown Swiss Lorreda Ssbloom Panda- Brown Swiss La Rainbow Bfly Sunkist ETV- Brown Swiss Fairdale Wasp Tillie- Brown Swiss J-G Springs Dairy - Emily Goode Fairdale total Cali- Brown Swiss Golden Oaks Topprize-Red ET- Red & White MS Sunrose Naomi ET- Holstein Colton & Cade Huffman Coulee Crest AP Jordan-ET- Guernsey Springhill YB Jewelry-ETV- Guernsey Springhill Cactus Blitzen- Guernsey Jeff & Lisa Gibson, Elmore & Stump Mowry’s Burdette Scarlet- Ayrshire Feltzbrook Advent Janie- Red- Red & White BDF Polaris Abbi- Milking Shorthorn Gibson, Hill & Whitman Heiz Acres Seaman Maine- Brown Swiss Gibson & Stump KY-Blue Diet Dew Exp-Et- Milking Shorthorn KY- Blue Diet Pepsi- Milking Shorthorn KY- Blue LS Diet Dr Pepper P- Milking Shorthorn Brilee Tucker & Hadley Olt Apple-PTS Aleesa-Red-ET- Red & White Apple-PTS Adesina-Red-ET- Red & White Kinslow Dairy Logsdon Comanche Nova- Milking Shorthorn Sagesar Ricochet Fancy- Milking Shorthorn Kinslow’s Armani 91- Red- Red & White
  16. 16. Joe Paul Mattingly 830 Sally Ray Pike, Raywick, KY Kentucky Hoop Barns Don’t Cost, They Pay Invest in a Kentucky Hoop Barn Today! Since 1999 CATTLE EQUIPMENT HAY & GRAIN
  17. 17. January - February 2021 • KDDC • Page 18 KDDC is supported in part by a grant from the Kentucky Agricultural Development Fund Choosing Functional Foods and Fermented Dairy T his past winter, The Dairy Alliance featured the Functional Foods: Fermented Dairy for Health media campaign, focusing on the importance of fermented dairy like yogurt and kefir as a part of a healthy diet. The campaign was featured in banner ads on Under Armour’s MyFitnessPal app and in their digital newsletter, providing opportunities for health-conscious consumers to discover the benefits of dairy. Kentucky’s own dairy advocate, medical student, and Olympic athlete Lee Kiefer posted to her social media encouraging the consumption of fermented dairy products, featuring a smoothie recipe developed by The Dairy Alliance, while in traditional media, The Dairy Alliance staff discussed what fermented foods are and why they are important to include at mealtimes. Through these utilized platforms, many consumers have learned the benefits of choosing fermented dairy foods. More Milk Cooler Programs Begin in Kentucky Food Pantries S ince sharing the success of the milk cooler program at the Adair County Food Bank in Columbia last summer, additional programs have been implemented in 10 other Kentucky locations: Allen County Fiscal Court Food Pantry in Scottsville, A Better Community in Flemingsburg, Central Kentucky Community Action Council in Lebanon, the Community Relief Fund in Glasgow, First Christian Church Community Food Pantry in Owenton, Garrard County Food Pantry in Lancaster, Livingston County Helping Hands in Smithland, Monroe County Food Pantry in Tompkinsville, New Hope Food Pantry of Danville, and the Shepherd’s Pie Food Pantry in Magnolia. Grants for this long-term milk cooler program provides a customized Undeniably Dairy cooler, supplies a one-time purchase of fresh half-gallons and gallons of milk, and connects the food bank with a processor for a continuing milk supply. The pantries, identified by dairy farmers, will only fill the coolers with real milk. Along with other The Dairy Alliance programs, partnerships, and grants that aid the fight against food insecurity, families in Kentucky will continue to be positively impacted through these endeavors in 2021.
  18. 18. January - February 2021 • KDDC • Page 19 KDDC is supported in part by a grant from the Kentucky Agricultural Development Fund Allied Sponsors PLATINUM Ag Central Alltech Bel Cheese Bluegrass Dairy & Food Burkmann Feeds Cowherd Equipment CPC Commodities Kentucky Department of Agriculture Kentucky Farm Bureau Kentucky Soybean Board Prairie Farms Shaker Equipment Sales Southwest Dairy Museum GOLD Dairy Express Services Farm Credit Services Givens & Houchins Inc. Mid-South Dairy Records Select Sires Mid-America SILVER Grain Processing Corporation Kentucky Veterinary Medical Association Luttrull Feed Owen Transport South Central Bank BRONZE Bagdad Rolling Mills Bank of Jamestown Central Farmers Supply Hartland Animal Hospital Kentucky Corn Growers Association Limestone & Cooper Mammoth Cave Dairy Auction QMI Quality Mgt Inc. Wilson Trucking Special Thanks to Our Sponsors
  19. 19. 176 Pasadena Drive Lexington, KY 40503 859.516.1129 ph Non-Profit US Postage PAID FEB 23 Dairy Alliance Annual Meeting, 12:00 CT, Online FEB 24 Kentucky Dairy Partners Meeting and Industry Trade Show, Sloan Convention Center Bowling Green, KY 9:00 A.M. C.T. FEB 24 Dairy Awards Banquet, Sloan Convention Center, Bowling Green, KY 12:00 C.T. FEB 24 KDDC Board Meeting, Sloan Convention Center, Bowling Green, KY 2:00 P.M. C.T. MAR 17-18 Professional Dairy Producers of Wisconsin Business Conference, Kalahari Resort and Convention, Wisconsin Dells, Wi MAR 18 KDDC Board Meeting, Taylor Co Ext. Office, Campbellsville KY 10: 00 A.M. E.T MAR 23 KDDC MILK 4.0 Road Show, Christian Co Ext. Office, Hopkinsville, KY 10:00 A.M. C.T. MAR 24 KDDC MILK 4.0 Road Show, Taylor Co Ext. Office, Campbellsville KY 10: 00 A.M. E.T. MAR 25 KDDC MILK 4.0 Road Show, Barren Co. Ext. Office, Glasgow, Ky 10:00 A.M. C.T. APR 07-10 Kentucky National Dairy Show and Sale, Exposition Center, Louisville, KY Calendar of Events