Wednesday, August 9, 2017

Demand for Polled in European dairy cattle breeding increasing

From the Dairy Newsletter March-April 2016

It was reported in Holstein International magazine in February that 10% of all European breedings in 2015 were with polled sires.   The greatest progression was 35% of all Red & White breedings.   This may have begun with animal rights but is now seen as an advantageous labor and cost saving selection.

We have had polled sires available in both Holstein (including Red Holstein) and Jersey for years, now with a scattering of polled appearing in several other breeds. 

Shifts in demand for various milk products

Fluid milk sales reported for 2015 indicate a 6% increase in demand for flavored milks, and a 3% gain in demand for whole milk packages, while skim milk packaging declined by 4%.    I just saw a new banana flavored milk package this week—so dairy product handlers are catching the trend.

It is good to have some news in fluid milk, because fluid utilization (the old milk price standard) overall was falling, and last year there was still a loss of 5.2% in fluid dollars generated, reflected in pay prices.   

The strong US dollar in exchange markets might hamper new exports, but it was still true that in 2015 one-seventh of all US milk production was exported.    California generates 40% of the export volume as Mexico and various Asian buyers are bigger volume users, and shipping distance is advantageous.

When you add up butter, hard cheeses, and yogurt (which has seen the creation of the new category of “greek style yogurt” grow dramatically) they now comprise the majority of your milk check dollars.

Butter may be in surplus, but consumption is growing

In any year when production gains faster than consumption, it will be butter and cheese stocks growing as they can be stored for future sales in holiday seasons.     But the recent news for butter has been more positive (nutritionists now see butter as superior to margarine for human health consequences) and news of McDonalds convenience food chain switch to butter for its taste advantages indicates a major shift in consumer preferences.    It is not often that taste and health benefit can be combined in one food item.

In the past fifteen years (1997 to 2012) USA butter consumption per capita rose from 4.1 pounds to 5.6 pounds, and is now estimated to be closing in on 6 pounds (per year).     Butter, cheese and yogurt now account for the majority of farmer milk checks.    This also proves that the growth in organic dairy sales is not coming at the expense of conventional dairy – given organic has been highly focused on fluid.

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