Reprinted with permission from the March 23, 2012, edition of CHEESE MARKET NEWS® © Copyright 2012 Quarne Publishing LLC; PH: (509) 962-4026; www.cheesemarketnews.com

Milk production increases in February vs. a year agoWASHINGTON — Milk production in the 23 major milk-producing states during February totaled 15.16 billion pounds, up 8.3 percent from February 2011, 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 on page 11.)

However, adjusting production for the additional day due to leap year causes February milk production to be up 4.6 percent on a per-day basis, NASS says.

January revised production in the 23 major states, at 15.81 billion pounds, was up 3.9 percent from January 2011. The Janu-ary revision represents an increase of 24 million pounds, or 0.2 percent, from last month’s preliminary production estimate.

For the entire United States, milk production in February totaled 16.28 billion pounds, NASS says, 8.0 percent above February 2011

9ROXPH��������������������������0DUFK���������������������������������1XPEHU����

By Alyssa Sowerwine

MADISON, Wis. — In the face of high milk production levels both domestically and globally, cash Cheddar prices at the Chicago Mercantile Exchange (CME) plummeted today after nearly three weeks of price increases.

The downward price move-ment was expected by many, as the dairy industry continues to report high milk production.

Cheddar barrels began a price rally March 7 that continued over the past two weeks. While bar-rels were at $1.4575 per pound March 5, on March 7 they began steadily increasing to $1.6250 as of Thursday before dropping 16.5 cents to $1.4600 per pound today.

Cheddar blocks have followed

Cash cheese price drops at CME after 3-week price rally

a similar pattern, beginning an increase on March 7 from $1.4600 per pound to $1.4850. Blocks continued to increase earlier this week and were at $1.6350 on Thursday before declining 14 cents to $1.4950 per pound today. (See chart on page 2.)

Dairy market analysts had predicted that the latest Milk Production report — which was released on Monday and shows U.S. milk production in February totaled 16.28 billion pounds, 8.0 percent above February 2011 production — likely would temper prices a bit. The latest cold stor-age report released Thursday also may have been a factor. (For more milk production and cold storage data, see articles in this issue.)

“It’s tough to support what’s been happening in the cheese market with these higher milk production numbers,” says Scott Brown, agricultural economist with the Department of Agricul-tural and Applied Economics at the University of Missouri.

Bob Cropp, professor emeri-tus for the University of Wis-consin-Madison’s Cooperative Extension, in his latest “Dairy Situation and Outlook” report released Monday, notes that milk production growth at this level should be depressing for milk prices.

“More milk means more dairy product production,” he notes.

Dave Kurzawski, a commod-ity broker with Downes-O’Neill, Chicago, says the reason for the cheese price rally was three-pronged.

“Unseasonably strong restau-rant sales in February nationwide is prompting some pipeline refill-ing, retail promotion season is under way and pre-grilling season purchases, normally made in late April or May, appear to have started early this year,” he says.

He adds that the increase in spot prices was driven largely by a short-term increase in demand for processed cheese as well as anecdotal evidence of an uptick in export business.

Kurzawski adds that retail promotions for the Easter and Passover holidays are having more of an effect on butter than cheese.

Butter has bumped up a bit at the CME in the past couple of weeks as well. While butter was at $1.4500 per pound from March 2-9, last week it began steadily increasing to its current level of $1.5225 per pound on Monday, where it has remained this week.

“Easter is the biggest butter sales holiday of the year, and when prices are set to the last loads traded, short-term bounces

can happen. Add into the mix the fact that the Upper Midwest and Northeast have seen unsea-sonably high temperatures for March, and I suspect ice cream manufacturing has tugged on the available supply of butterfat early this year,” he says.

Sara Dorland, managing part-ner with Ceres Dairy Risk Man-agement LLC, Seattle, notes that Tuesday’s results from Fonterra’s globalDairyTrade (gDT) auc-tion showed lower prices for all commodities, including cheese. Following the auction, Cheddar was at a U.S. price equivalent of about $1.4125 per pound. (See article in this issue.)

She noted that looking at gDT, the market was pretty far off the mark for world prices.

“When the United States gets out of sync with the world price, we typically see export demand slow a bit,” she says.

Cropp notes that higher milk prices for the last half of the year will depend upon the level of milk production.

“It will require a slowdown in the increase in milk production from current levels,” he says. “This could very well happen for the second half of the year.

“The combination of lower milk prices for the first half of

Class 4a inclusion requested by CDI in CDFA hearing

Turn to PRICES, page 11 D

Turn to NASS, page 11 D

SACRAMENTO, Calif. — The California Department of Food and Agriculture (CDFA) has called a public hearing to consider pro-posed changes to the whey factor in the Class 4b pricing formula. The hearing is a re-sponse to petitions submit-ted earlier this month by the Western United Dairymen and a coalition of producer organizations. (See “More

Turn to CDFA, page 10 DTurn to BUDGET, page 10 D

House Budget Committee OKs fiscal year 2013 budget plan WASHINGTON — The House Budget Committee late Wednesday voted 19-18 to advance a fiscal year 2013 budget resolution released earlier this week by Rep. Paul Ryan, R-Wis., chair of the committee. The reso-lution is expected to be considered on the full House floor next week.

“I am proud of my colleagues on the House Budget Committee who worked together to write and advance this budget, which puts our na-tion’s finances on a path to balance and pay off the debt,” Ryan says. “Much work remains, but today we are happy to say we have taken another step on the path to prosperity.

“The Democrat-controlled Senate has failed to pass a budget in over 1,000 days, while the president still refuses to offer credible solutions to the most predictable economic crisis in our history,” Ryan adds.

The budget proposal calls for extending the federal pay freeze through 2015, increasing federal retirement contributions and cutting the federal work force by 10 percent. The measure would save about $368 billion over 10 years, Ryan says.

Agricultural groups this week noted that the budget proposal would cut the USDA budget by $180 billion over 10 years.

Rep. Collin Peterson, D-Minn., ranking member of the House Ag-riculture Committee, says the proposal “all but guarantees there will be no farm bill this year.

“The Ryan budget proposes significant cuts in the farm safety net and conservation programs and slashes spending on nutrition pro-grams that provide food for millions of Americans,” Peterson says. “It is appalling that in an attempt to avoid defense cuts, the Republican leadership has elected to leave farmers and hungry families hurting.

“We need to get our spending under control, and agriculture has shown that we can do our part, but all other sectors of our economy need to do so as well,” he adds. “To do otherwise is irresponsible.”

Roger Johnson, president of the National Farmers Union (NFU), Turn to BUDGET, page 10 D

Scan this code for breaking news and the latest markets!

A

INSIDE) Guest column: ‘Control of Listeria monocytogenes in cheese and the plant environment.’ For details, see page 4.

) Indiana lawmakers want study on sale of raw milk to consumers. For details, see page 6.

) Milk Specialties Co. cited by OSHA for violations. For details, see page 8.

) FDA reports continued decline in drug residues. For details, see page 12.

Reprinted with permission from the March 23, 2012, edition of CHEESE MARKET NEWS® © Copyright 2012 Quarne Publishing LLC; PH: (509) 962-4026; www.cheesemarketnews.com Reprinted with permission from the March 23, 2012, edition of CHEESE MARKET NEWS® © Copyright 2012 Quarne Publishing LLC; PH: (509) 962-4026; www.cheesemarketnews.comReprinted with permission from the March 23, 2012, edition of CHEESE MARKET NEWS® © Copyright 2012 Quarne Publishing LLC; PH: (509) 962-4026; www.cheesemarketnews.com

2 CHEESE MARKET NEWS® — March 23, 2012

MARKET INDICATORS

DISCLAIMER: Cheese Market News® has made every effort to provide accurate current as well as historical market information. However, we do not guarantee the accuracy of these data and do not assume liability for errors or omissions.

STAFF SUBSCRIPTION INFORMATION&KHHVH�0DUNHW�1HZV���3XEOLFDWLRQ�����������������������������������,661�������������LV�SXEOLVKHG�ZHHNO\�E\�4XDUQH�3XEOLVKLQJ�//&�������6LJQDWXUH�'ULYH��0LGGOHWRQ��:,���������3KRQH����������������)$;���������������3HULRGLFDOV�SRVWDJH�SDLG�DW�0DGLVRQ��:,��&LUFXODWLRQ�UHFRUGV�DUH�PDLQWDLQHG�E\�4XDUQH�3XEOLVKLQJ�//&�������6LJQDWXUH�'ULYH��0LGGOHWRQ��:,� ��������POSTMASTER: Send address changes to Cheese Market News®, Subscriber Services, P. O. Box 628254, Middleton, WI 53562; Form 3579 requested; or call direct at 608/831-6002.� �$OO� ULJKWV�UHVHUYHG�XQGHU�WKH�8QLWHG�6WDWHV�,QWHUQDWLRQDO�DQG�3DQ�$PHULFDQ�&RS\ULJKW� &RQYHQWLRQV�� 1R� SDUW� RI� WKLV� SXEOLFDWLRQ� PD\� EH�UHSURGXFHG��VWRUHG�LQ�D�UHWULHYDO�V\VWHP�RU�WUDQVPLWWHG�LQ�DQ\�IRUP�RU�E\�DQ\�PHDQV��PHFKDQLFDO�� SKRWRFRS\LQJ��HOHFWURQLF�UHFRUGLQJ�RU�RWKHUZLVH��ZLWKRXW�WKH�SULRU�ZULWWHQ�SHUPLVVLRQ�RI�4XDUQH� 3XEOLVKLQJ� //&�� �2SLQLRQV� H[SUHVVHG� LQ� DUWLFOHV� DUH�WKRVH� RI� WKH� DXWKRUV� DQG� GR� QRW� QHFHVVDULO\� UHÁHFW� WKRVH� RI�4XDUQH�3XEOLVKLQJ�//&�GED�&KHHVH�0DUNHW�1HZV���&KHHVH�0DUNHW�1HZV��GRHV�QRW�HQGRUVH�WKH�SURGXFWV�RI�DQ\�DGYHUWLVHU�DQG�GRHV�QRW�DVVXPH�DQG�KHUHE\�GLVFODLPV�DQ\�OLDELOLW\�WR�DQ\�SHUVRQ�IRU�DQ\�ORVV�RU�GDPDJH�FDXVHG�E\�HUURUV�RU�RPLVVLRQV�LQ�WKH�PDWHULDO�FRQWDLQHG�KHUHLQ��UHJDUGOHVV�RI�ZKHWKHU�VXFK�HUURUV�UHVXOW�IURP�QHJOLJHQFH��DFFLGHQW�RU�DQ\�RWKHU�FDXVH�ZKDWVRHYHU��&RS\ULJKW������E\�4XDUQH�3XEOLVKLQJ�//&�Subscriptions:������IRU�8�6���VHFRQG�FODVV�GHOLYHU\���������IRU�8�6��ÀUVW�FODVV�GHOLYHU\�LQFOXGLQJ�&DQDGD�DQG������,QWHU�QDWLRQDO�UDWH�WR�DOO�RWKHUV���3ULQWHG�LQ�8�6�$�

Susan Quarne, 3XEOLVKHU (PH 608/831-6002; FAX 608/831-1004)���e-mail: squarne@cheesemarketnews.com Kate Sander, (GLWRULDO�'LUHFWRU (PH 509/962-4026; FAX 509/962-4027)���e-mail: ksander@cheesemarketnews.comAlyssa Sowerwine, 6HQLRU�(GLWRU (PH 608/288-9090; FAX 608/288-9093)�� e-mail: asowerwine@cheesemarketnews.comRena Archwamety, 1HZV�:HE�(GLWRU (PH 608/288-9090; FAX 608/288-9093)�� e-mail: rena@cheesemarketnews.com Aaron Martin, 1HZV�(GLWRU (PH 608/288-9090; FAX 608/288-9093)�� e-mail: amartin@cheesemarketnews.com

REGULAR CONTRIBUTORSJohn Umhoefer, Downes-O'Neill LLC, International Dairy Foods Association, National Milk Producers Federation

SUBSCRIPTIONS & BUSINESS STAFFSubscription/advertising rates available upon requestContact: Susan Quarne - PublisherP.O. Box 628254, Middleton, WI 53562PHONE 608/831-6002 • FAX 608/831-1004

WEBSITE: �www.cheesemarketnews.com

Cheddar Cheese and Dairy Product Prices

Cheese 40-lb. Blocks:

*/Revised. 1/Prices weighted by volumes reported. 2/Sales as reported by participating manufacturers. Reported in pounds. More information is available by calling NASS at 202-690-2424.

2/25/12

Average price1

Minn./Wis. Other states U.S.Sales volume2

Minn./Wis. Other states U.S.

Cheese 500-lb. Barrels:Average price1

Minn./Wis. Other states U.S.Adj. price to 38% moisture Minn./Wis. Other states U.S.Sales volume2

Minn./Wis. Other states U.S.Moisture content Minn./Wis. Other states U.S.

3/3/12

Butter:Average price1 U.S.Sales volume2 U.S.

Nonfat Dry Milk:Average price1 U.S.Sales volume2 U.S.

Dry Whey:Average price1 U.S.Sales volume2 U.S.

For the week ended:

$1.5826$1.4877$1.4940

651,9239,180,3009,832,223

$1.5879$1.5964$1.5922

$1.5213$1.5076$1.5143

4,837,9084,947,0659,784,973

35.2934.3534.81

$1.41925,515,839

1.368518,744,028

$.61109,028,734

$1.5698$1.4782$1.4873

919,8888,386,7069,306,594

$1.5850$1.5830$1.5837

$1.5169$1.5002$1.5065

4,071,5566,679,532

10,751,088

35.2234.5834.82

$1.42346,205,309

1.364219,121,044

$.60659,156,397

3/10/12

$1.5746$1.4834$1.4926

1,001,4388,910,1939,911,631

$1.5867$1.5863$1.5865

$1.5215$1.5082$1.5146

5,434,4245,805,132

11,239,556

35.3434.7935.06

$1.41504,109,948

1.3410*22,506,612

*$.6195*7,921,632

$1.5922$1.4836$1.4955

1,126,4049,130,686

10,257,090

$1.5895$1.5830$1.5857

$1.5141$1.4996$1.5056

4,935,3176,986,505

11,921,822

34.9134.5534.70

$1.44254,876,999

1.326123,438,045

$0.60448,424,669

3/17/12

CLASS III PRICE (Dollars per hundredweight, 3.5% butterfat test)

YEAR2006200720082009201020112012

JAN13.3913.5619.3210.7814.5013.4817.05

FEB12.2014.18 17.03 9.31 14.2817.0016.06

MAR11.1115.0918.0010.4412.7819.40

APR10.9316.0916.7610.7812.9216.87

MAY10.8317.6018.18 9.8413.3816.52

JUN11.2920.1720.25 9.9713.6219.11

JUL10.9221.3818.24 9.9713.7421.39

AUG11.0619.8317.3211.2015.1821.67

SEP12.2920.0716.2812.1116.2619.07

OCT12.3218.7017.0612.8216.9418.03

NOV12.8419.2215.5114.0815.4419.07

DEC13.4720.6015.2814.9813.8318.77

(These data, which includes government stocks and is reported in thousands of pounds, are based on reports from a limited sample of cold storage centers across the country. This chart is designed to help the dairy industry see the trends in cold storage between the release of the National Agricultural Statistics Service’s monthly cold storage reports.)

ButterCheese

9,224134,540

+448-1,350

7,376126,894

+947-1,004

+1,848+7,646

+11 -1

Weekly Cold Storage Holdings March 19, 2012 On hand Week Change since March 1 Last Year Monday Change Pounds Percent Pounds Change

Total Contracts Traded/Open Interest

MAR12APR12MAY12JUN12JUL12AUG12SEP12OCT12NOV12DEC12JAN 13

44/2,508

60.7557.0050.9350.0047.0046.7545.0045.0045.0045.0040.00

452369326335190198185164145141

3

DRY WHEY FUTURES for the week ended March 22, 2012 (Listings for each day by month, settling price and open interest)

60.0057.4851.5049.0048.0046.7545.0045.0045.0045.0040.00

453368323334190198185164145 141

3

24/2,504

60.3358.0051.4550.0047.0047.0045.0045.0045.0045.0040.00

471366334339192199186164145141

3

96/2,540

Fri., March 16 Mon., March 19 Tues., March 20 Wed., March 21 Thurs., March 22

60.7557.4852.5050.7548.5046.7545.0045.0045.0045.0040.00

7/2,479

60.7557.7552.5050.7550.0046.7545.0045.0045.0045.0040.00

452366308325188198184164145141

3

68/2,474

452369309326188198184164145141

3

Daily market prices are available by visiting CME’s online statistics sites at http://www.cmegroup.com.

Total Contracts Traded/Open Interest Daily market prices are available by visiting CME’s online statistics sites at http://www.cmegroup.com.

MAR12APR12MAY12JUN12JUL12AUG12SEP12OCT12NOV12DEC12JAN 13 FEB 13

197/8,938

1.5251.5601.5351.5801.6491.7021.7181.7271.7001.7001.6831.754

1,3921,3711,2451,134

786739658543520527

221

CHEESE FUTURES for the week ended March 22, 2012 (Listings for each day by month, settling price and open interest)

1.5241.6101.5711.6101.6551.7021.7181.7451.7101.7001.6831.754

1,3931,3621,2231,131

785739658541522527

221

71/8,904

1.5221.6001.5341.5771.6421.7021.7181.7451.7101.7001.6831.754

1,3941,3631,2721,138

789748658566539538

221

Fri., March 16 Mon., March 19 Tues., March 20 Wed., March 21 Thurs., March 22

1.5251.5681.5331.5951.6651.7051.7301.7271.7001.7001.6831.754

1,3921,3711,1891,078

778738657542519518

221

108/8,805

1.5251.5531.5551.6061.6911.7181.7351.7271.6971.7001.6831.754

1,3921,3611,1361,068

776738656542519518

221

140/8,729 217/9,028

Monday Tuesday Wednesday Thursday Friday

Chicago Mercantile Exchange

March 19 March 20 March 21 March 22 March 23

Weekly average (March 19-23): Barrels: $1.5830(+.0275); 40-lb. Blocks: $1.5900(+.0555).Weekly ave. one year ago (March 21-25, 2011): Barrels: $1.6730; 40-lb. Blocks: $1.6355.

Cheese BarrelsPriceChange

Cheese 40-lb. blockPriceChange

Extra Grade NDMPriceChange

Grade A NDMPriceChange

Weekly average (March 19-23): Extra Grade: $1.2575(NC); Grade A: $1.2675(NC).

Grade AA ButterPriceChange

Class II Cream (Major Northeast Cities): $1.8006(+.0606)–$2.0257(+.1407).Weekly average (March 19-23): Grade AA: $1.5225(+.0220).

$1.6250+1 1/4

$1.6350+3 1/4

$1.5225NC

Sign up for our daily fax or e-mail service for just $104 a year. Call us at 608-288-9090.

$1.2575 NC

$1.2675NC

Cash prices for the week ended March 23, 2012

$1.6125+2

$1.6025+2

$1.2575NC

$1.2675NC

$1.5225NC

$1.6250NC

$1.6350NC

$1.5225NC

$1.2575 NC

$1.2675NC

$1.5225NC

$1.4600-16 1/2

$1.4950-14

$1.2575 NC

$1.2675NC

$1.5225 +3/4

$1.2575NC

$1.5925+1

$1.5825NC

$1.2675NC

Reprinted with permission from the March 23, 2012, edition of CHEESE MARKET NEWS® © Copyright 2012 Quarne Publishing LLC; PH: (509) 962-4026; www.cheesemarketnews.comReprinted with permission from the March 23, 2012, edition of CHEESE MARKET NEWS® © Copyright 2012 Quarne Publishing LLC; PH: (509) 962-4026; www.cheesemarketnews.com

March 23, 2012 — CHEESE MARKET NEWS® 3

DISCLAIMER: Cheese Market News® has made every effort to provide accurate current as well as historical market information. However, we do not guarantee the accuracy of these data and do not assume liability for errors or omissions.

For more information please visit www.cheeseshredder.com

NEWS/BUSINESS MARKET INDICATORS

www.cheeseshredder.comFALLON, Nev. — Kansas City, Mo.-based Dairy Farmers of America (DFA) has closed an agreement with the city of Fallon, Nev., to buy 31.5 acres in the city’s New River Business Park for a state-of-the-art dairy ingredient manu-facturing facility capable of producing value-added products for domestic and global customers.

The facility will be equipped to process 2 million pounds of raw milk daily and, at full capacity, will produce approximately 250,000 pounds of dried dairy ingredients daily. (See “DFA to build dehydrated milk plant in Fallon, Nev.” in the December 16, 2011, issue of Cheese Market News.)

DFA to break ground on Nevada plant in AprilThe investment, approved by DFA’s

board of directors, is part of the coop-erative’s strategic initiative to increase commercial investments in an effort to bring increased value to DFA’s member owners. The project also provides DFA the opportunity to enter a new market segment and to continue to leverage dairy farmer equity into profitable invest-ments, DFA says.

Eric Grimes, executive director of the Churchill Economic Development Authority in Fallon, says the ground-breaking on the new plant will be April 11. Construction is scheduled to be complete by the summer of 2013. CMN

Dry Products* March 23, 2012

DRY BUTTERMILK(FOB)Central & East: $1.2000-$1.3300(-1 1/4).(FOB) West: $1.1600(-4)-$1.2800(-1); mostly $1.2000(-3)-$1.2600(-2 1/2).

EDIBLE LACTOSE(FOB)Central and West: $.7400(-5)-$.9950; mostly $.8200-$.9000.

NONFAT DRY MILKCentral & East: low/medium heat $1.1800(-2)-$1.4050(-2 1/2); mostly $1.2100(-2)-$1.3500(-4). high heat $1.3600(-2)-$1.4500(-2 1/2).West: low/medium heat $1.1500(-5)-$1.3750(-1 1/2); mostly $1.2000(-2)-$1.3400. high heat $1.3200(-1)-$1.4250.Calif. manufacturing plants: extra grade/grade A weighted ave. $1.3439(-.0006) based on 16,578,307 lbs. Sales to CCC: 0 lbs.

WHOLE MILK POWDER (National): $1.5800-$1.6400(-4)

DRY WHEYCentral: nonhygroscopic $.5700(+27)-$.6775(-1); mostly $.5950(-1)-$.6400.West: nonhygroscopic $.3000-$.6375(+1/4); mostly $.4800(-2)-$.5850(-2 1/2).(FOB) Northeast: extra grade/grade A $.6625(+16 1/4)-$.6825(-1/2).

ANIMAL FEED (Central): Whey spray milk replacer $.4800-$.5400(-7).

WHEY PROTEIN CONCENTRATE (34 percent): $1.2500(-15)-$1.6700; mostly $1.4700(-3)-$1.5400.

CASEIN: Rennet $4.3000-$4.9000; Acid $4.8200-$5.1000.

*Source: USDA’s Dairy Market News

Advanced Prices and Pricing Factors

Base Skim Milk Price for Class I1: Advanced Class III Skim Milk Pricing Factor: Advanced Class IV Skim Milk Pricing Factor: Advanced Butterfat Pricing Factor2: Class II Skim Milk Price: Class II Nonfat Solids Price: Two-week Product Price Averages:

Butter: Nonfat Dry Milk: Cheese: Dry Whey:

Note: The Class I price equals the Class I skim milk price times 0.965 plus the Class I butterfat price times 3.5, rounded to the nearest cent.For information only: The Class I base price is 15.66.1/ Higher of advanced Class III or IV skim milk pricing factors. The Class I skim milk price equals this price plus applicable Class I differential.2/ The Class I butterfat price equals the price plus applicable Class I differential divided by 100. Data provided by USDA

April 2012 $10.70/cwt. $10.70/cwt. $10.39/cwt. $1.5239/lb. $11.09/cwt. $1.2322/lb.

$1.4299/lb. $1.3334/lb. $1.5186/lb. $0.6117/lb.

March 2012 $10.96/cwt. $10.96/cwt. $10.92/cwt. $1.6355/lb. $11.62/cwt. $1.2911/lb.

$1.5220/lb. $1.3930/lb. $1.5553/lb. $0.6531/lb.

Daily market prices are available by visiting CME’s online statistics sites at http://www.cmegroup.com. #The total contracts traded for Class III milk includes electronically-traded contract volumes.*Total Contracts Traded/Open Interest reflect an additional month not included in this chart.

Total Contracts Traded/Open Interest

Cash-Settled NDM*

208242230313288240166133

3/2,032

MAR12APR12MAY12JUN12JUL12AUG12SEP12OCT 12

Cash-Settled Butter

MAR12APR12MAY12JUN12JUL12AUG12SEP12OCT12NOV12DEC 12

Total Contracts Traded/Open Interest

833698628702516547516562467395

82/5,864

143.00147.00149.50153.75155.25156.75157.75160.00161.75161.00

135.00127.75127.00130.00133.50132.75133.28135.28

208242232313288240166133

12/2,034

143.00148.00149.50154.50155.25156.75157.75160.00161.75161.00

833698628703523551516562467395

24/5,876

135.00127.75127.00130.00133.50134.00133.28135.28

208242232313288241166133

1/2,035

143.00146.50149.50153.50155.00156.80157.80160.00162.00161.00

833696629708531553516562467395

51/5,890

Fri., March 16 Mon., March 19 Tues., March 20 Wed., March 21 Thurs., March 22

Fri., March 16 Mon., March 19 Tues., March 20 Wed., March 21 Thurs., March 22

Total Contracts Traded/Open Interest

Fri., March 16 Mon., March 19 Tues., March 20 Wed., March 21 Thurs., March 22

MAR12APR12MAY12JUN12JUL12AUG12SEP12OCT12NOV12DEC12JAN13FEB13MAR13APR13MAY13JUN13JUL13AUG 13SEP 13

Class III Milk#*

15.6415.8915.2415.5616.1016.5916.7416.8016.3716.3816.0116.0816.3816.1116.1116.1116.2516.0016.25

6,0984,8994,1293,4702,5462,4022,2742,0761,8681,781

172130

953424261612

2

1,090/32,059

15.6416.2615.5515.8616.3116.6616.8016.8316.4316.4516.0216.0816.3816.1116.1116.1116.2516.0016.25

6,1254,8294,1053,4392,5692,4162,2752,0831,8721,785

172130103

3424261612

2

1,542/32,022

15.6316.3115.2115.5416.1116.6516.7816.7016.4116.4216.0716.0816.3816.1116.1116.1116.2516.0016.25

5,9964,8814,2013,4782,5762,4282,2742,0911,8801,799

173132107

3424261612

2

2,248/32,135

Total Contracts Traded/Open Interest

Class IV Milk

MAR12APR12MAY12JUN12JUL12AUG12SEP12OCT12NOV 12DEC 12

15.4814.9915.0615.5015.9515.9816.1516.3016.4316.40

354327279233

555155665857

15.4814.9915.0615.5015.9515.9816.0516.3016.4316.40

354327279233

565155675857

21/1,537

15.4814.9915.0615.5015.9515.9816.0516.3016.4316.30

354327279233

585257696059

6/1,535

CME FUTURES for the week ended March 22, 2012

Fri., March 16 Mon., March 19 Tues., March 20 Wed., March 21 Thurs., March 22

12/1,548

15.6315.8415.3015.6816.2816.7316.7516.7416.4416.3816.0116.0816.3816.1016.1016.1016.2516.0016.25

15.4814.9915.0615.5015.9515.9816.1516.3016.4316.40

135.00127.75127.00129.50131.75132.75133.28135.28

143.00149.25151.00155.00156.75157.25157.75160.00161.75161.00

26/5,795

1/2,029

0/1,535

959/31,754

15.6115.8215.5015.8816.4616.7816.7916.7416.4416.4216.1816.0516.3816.1016.1016.1016.2516.0016.25

1,270/31,580

15.4814.9915.0615.5015.9515.9816.3416.3016.4316.40

354327279233

555155665857

0/1,535

135.00127.75127.00129.50131.75132.75133.28135.28

208242230312286240166133

1/2,029

143.00147.75150.00153.75155.25156.95157.75160.00161.75161.00

830696612648509545516562467395

28/5,780

6,1114,8153,942 3,3462,4802,3862,2762,0771,8701,780

172128843424261511

1

354327279233

555155665857

208242230312286240166133

833697615656509545516562467395

135.00127.75127.00129.50133.50132.75133.28135.28

6,1014,8324,0303,3902,5042,3902,2752,0771,8701,780

172129

913424261511

1

Reprinted with permission from the March 23, 2012, edition of CHEESE MARKET NEWS® © Copyright 2012 Quarne Publishing LLC; PH: (509) 962-4026; www.cheesemarketnews.com Reprinted with permission from the March 23, 2012, edition of CHEESE MARKET NEWS® © Copyright 2012 Quarne Publishing LLC; PH: (509) 962-4026; www.cheesemarketnews.comReprinted with permission from the March 23, 2012, edition of CHEESE MARKET NEWS® © Copyright 2012 Quarne Publishing LLC; PH: (509) 962-4026; www.cheesemarketnews.com

4 CHEESE MARKET NEWS® — March 23, 2012

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Perspective:Cheese Technology

Control of Listeria monocytogenes in cheese and the plant environment

G U E S T C O L U M N I S T C M N E x c l u s i v e !

Listeria monocytogenes was rec-ognized as a human pathogen in 1929 after a severe outbreak which resulted in unusual deaths in gerbils near Johan-nesburg, South Africa, in 1927. It was later discovered and confirmed that it can infect both humans and animals (zoonosis).

Listeria monocytogenes, even if accidentally ingested with food, is usu-ally a harmless transient in the human intestinal tract. Healthy individuals affected by Listeria monocytogenes generally only experience mild flu-like symptoms.

However, approximately 500 people die annually in the United States as a result of the infection. Listeriosis is a very selective disease and affects mainly pregnant women, diabetics, young children and the elderly, and immune-compromised individuals such as cancer patients, people taking drugs that affect the body’s immune system, alcoholics and individuals infected with AIDS.

After ingestion of food contaminated with Listeria monocytogenes, the incu-bation period for infection is usually in the range of 3 to 70 days, with a median of 21 days, in the susceptible individual. The symptoms of listeriosis, in the sus-ceptible individuals, are miscarriages in pregnant women, meningitis in new-born infants, and meningoencephlitis in immune-compromised adults. In the 1980s there were several listeriosis outbreaks linked to the consumption of raw vegetables, cheese made with raw milk or cheese made with pasteurized milk and later contaminated, raw and cooked poultry products, egg products, raw meat and seafood products.

The largest outbreak of listeriosis occurred in Los Angeles in 1985 which affected 93 pregnant women. The outbreak was associated with consump-tion of non-cultured raw milk Spanish cheese, apparently made using pasteur-ized milk contaminated with raw milk.

Another outbreak involving soft cheese made with raw milk occurred in Switzerland during 1983-1987 with 122 cases of listeriosis.

In the majority of these cases, liste-

riosis was associated with consumption of raw milk or dairy products made with raw milk. Several investigators have pointed out that high pH cheeses have a tendency to support the growth of Lis-teria. This is especially true with mold-ripened soft cheeses, where the growth of mold shifts the pH of cheese upward. Meanwhile, other investigators have proven that Listeria monocytogenes does not grow or survive in fermented dairy products due to the combination of competition with starter cultures, low water activity and low pH.

Recently, in 2011, several dairy products from a single source were recalled in the state of Indiana because one sample from a production facility showed positive results (a 4-year-old Cheddar, which was packaged in half-pound quantities). It was a voluntary recall by the manufacturer, and ac-cording to FDA there were no reported fatalities. My educated guess is that this incident is due to the contamination of cheese with Listeria at the time of repacking. Another possible explana-tion is the shift in the cheese’s pH as it ages, allowing Listeria to grow. Other culprits which can raise the pH of aged or stored cheese are yeast and molds, which can also contribute to the survival of Listeria.

Listeria monocytogenes is a bac-terium commonly found in water, soil, plant material, animals and humans. It is a gram-positive bacilli which occurs singly or in pairs. The organism is non-capsulated, non-acid-fast and non-spore forming and produces lactic acid from glucose. The organism is highly sensitive to copper ions due to the oligodynamic effect of the metal. Perhaps, copper salts can be incorporated into the surface of floors and in the floor drains to reduce or eliminate Listeria in the plant environment.

Listeria monocytogenes can grow in the presence or absence of air, and can survive and grow at pH 4.5 to 9.2 and in water activity above 0.92. The organism can grow at temperatures between -0.4 to 45C, and can survive and grow in the presence of high salt concentration

(up to 10 to 14 percent). It is relatively heat-resistant, but the good news is it can be killed or destroyed at normal pasteurization temperatures. It has been clearly stated in literature that Listeria monocytogenes is sensitive to phosphate salts, which are generally used in the bulk culture medium.

Let us analyze the chances of Lis-teria monocytogenes to survive and grow during the manufacture of regular cheese made with pasteurized milk and cultures (for example — Mozzarella):

• The milk is pasteurized, conse-quently Listeria monocytogenes should not be in the pasteurized milk (provided raw milk is significantly low in number of Listeria).

• The milk is inoculated with high phosphate bulk starter culture, which is not conducive for the growth and survival of Listeria because of the pres-ence of phosphate salts.

• The starter cultures and their enzymes in the bulk cultures employed in cheesemaking will voraciously con-sume lactose, glucose and perhaps galactose and consequently Listeria monocytogenes is nutritionally starved for the available carbohydrate source — specifically glucose.

• The end products of starter cultures, especially lactic acid and other organic acids, lower the pH of the cheese to minimize the growth of Listeria, especially with concomitant reduction of glucose concentration, which is highly required for Listeria monocytogenes survival.

• The low pH Mozzarella cheese curd (pH 5.3+0.1), along with salt, is further heat-treated at a high temperature in the mixer and molder further arresting the growth and survival of Listeria.

• The cheese blocks (which had low pH, low glucose, phosphate ions from bulk starters, high heat treatment in mixer-molder) are added to cold brine, which is not an idle environment for the proliferation of injured Listeria monocytogenes. Brine tends to pick up free residual sugars from the cheese. As long as we undertake proper steps to reduce the glucose level in brine through additional microbial fermen-tation (brine culture), the chances of

Listeria surviving and proliferating is significantly lower.

This leaves only one possibility — extraneous contamination from em-ployees, unclean surfaces, floors, floor drains, etc. If we eliminate the avail-ability of glucose on the floors, brine tanks and also in the cheese, in addition to using copper salts on the surface of the floor and floor drains, the chances of having Listeria monocytogenes will be significantly minimized. In addition, it is a good idea to use a proven milk silo culture in cold raw milk to decrease the residual levels of glucose and to discourage the proliferation of Listeria in the raw milk in silos.

Even in the shredded or diced cheeses, it is an extremely good idea to take measures to significantly minimize or eliminate simple sugar glucose, yeast and molds to discourage the growth and survival of Listeria monocytogenes.

As a food for thought, I wonder if our test procedures are even accurate regarding the enumeration of Listeria monocytogenes. A thermally-injured organism cannot survive in the human stomach. Consequently, a differential test procedure should be developed to differentiate virulent (active) vs. non-virulent (thermally-injured) Listeria monocytogenes. This is especially true with the pasteurized, cultured low pH dairy products because an enriched bacteriological growth medium can re-vive the thermally-injured non-virulent organism under laboratory conditions but not in the human stomach (with low pH). This is a million dollar question, and it should be addressed, in the future, to safeguard our industry, since Listeria has been given a zero-tolerance status.

Listeria can be controlled, and we can produce the safest dairy products to safeguard the health of our American consumers and the global population. The importance of educating plant employees regarding Listeria monocytogenes and other pathogens cannot be ignored. CMN

The views expressed by CMN’s guest columnists are their own opinions and do not necessarily reflect those of Cheese Market News®.

NEWS/BUSINESS

ARLINGTON, Va. — Cooperatives Working Together (CWT) has accepted 15 requests for export assistance from Dairy Farmers of America, Darigold, Maryland & Virginia Milk Producers Cooperative, Michigan Milk Producers Association and United Dairymen of Arizona to sell a total of 1,710 metric tons (3.8 million pounds) of Cheddar and Monterey Jack and 678 metric tons (1.5 million pounds) of butter to customers in Asia, the Middle East and Africa. The product will be delivered March through September 2012.

CWT accepts 15 bids for export assistanceIn 2012, CWT has assisted member

cooperative in making export sales of Cheddar, Monterey Jack and Gouda totaling 34.2 million pounds and but-ter totaling 30.3 million pounds to 18 countries on four continents. On a butterfat basis, the milk equivalent of these exports is 977 million pounds, or the annual production of approximately 46,520 cows.

CWT will pay export bonuses to the bidders when delivery of the product is verified by the submission of the required documentation. CMN

Reprinted with permission from the March 23, 2012, edition of CHEESE MARKET NEWS® © Copyright 2012 Quarne Publishing LLC; PH: (509) 962-4026; www.cheesemarketnews.comReprinted with permission from the March 23, 2012, edition of CHEESE MARKET NEWS® © Copyright 2012 Quarne Publishing LLC; PH: (509) 962-4026; www.cheesemarketnews.com

March 23, 2012 — CHEESE MARKET NEWS® 5

NEWS/BUSINESS

For more information please visit www.johnsonindint.com

DEDICATED TO THE CHEESE & DAIRY INDUSTRIES FOR OVER FOUR DECADES!

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NORTHFIELD, Ill. — Kraft Foods Inc. this week announced plans to change the corporate name for its global snacks company to Mondelez International Inc.

“Mondelez” (pronounced mohn-dah-LEEZ) is a newly coined word that evokes the idea of “delicious world,” the company says, noting that “Monde” derives from the Latin word for “world,” and “delez”

Kraft Foods proposes Mondelez International as new name for global snacks companyis a fanciful expression of “delicious.”

In addition, “International” captures the global nature of the business, Kraft Foods adds.

As previously announced, Kraft Foods is dividing to create two industry-leading public companies before the end of 2012: a high-growth global snacks business and a high-margin

North American grocery business. The North American grocery company will become Kraft Foods Group, Inc., retain-ing the Kraft brand for its corporate identity and as the brand for many of its consumer products. As a result, the global snacks company will require a new name when it launches later this year. (See “Kraft plans to create two independent companies” in the Aug. 5, 2011, issue of Cheese Market News.)

“The Kraft brand is a perfect fit for the North American grocery business and gives it a wonderful platform on which to build an exciting future,” says Irene Rosenfeld, chair and CEO, Kraft Foods Inc. “For the new global snacks company, we wanted to find a new name that could serve as an umbrella for our iconic brands, reinforce the truly global nature of this business and build on our higher purpose — to ‘make today

delicious.’ Mondelez perfectly captures the idea of a ‘delicious world’ and will serve as a solid foundation for the strong relationships we want to create with our consumers, customers, employees and shareholders.”

Kraft’s board of directors has ap-proved and will submit an amendment to the company’s articles of incorporation for shareholder approval at the com-pany’s annual meeting of shareholders on May 23.

Until the new companies launch later in 2012, the name and stock trading sym-bol for Kraft Foods Inc. will not change. In addition, the name change will not in any way affect the validity or trans-ferability of any currently outstanding stock certificates, and the company will not ask shareholders to surrender for exchange any Kraft Foods Inc. cer-tificates presently held by them. CMN

KANSAS CITY, Mo. — Dairy Farmers of America Inc. (DFA) posted net sales of $13 billion and net income of $40.2 million for 2011, adjusted to exclude a $76.9 million non-cash loss related to an exchange of affiliate interest, the cooperative said in financial results released during its annual meeting this week.

In 2011, DFA exchanged its affiliate ownership interest in HP Hood LLC for 100 percent ownership interest in Kemps, which formed the foundation of a new Fluid Milk and Ice Cream Division. This exchange allowed the coopera-tive to convert a minority position to a wholly-owned business.

“We continued the momentum we gained in 2010 to move forward and grow as a cooperative and as an indus-try,” says Randy Mooney, chair of DFA’s board. “After spending the last few years making improvements, the cooperative is in a position to take advantage of opportunities in the United States and abroad.”

Throughout 2011, DFA directed the marketing of 63 billion pounds of milk for both members and non-members through consolidated entities and unconsolidated affiliates, which repre-sents approximately 30 percent of total milk production in the United States. The marketing of raw milk accounted for approximately 74 percent of DFA’s consolidated net sales in 2011.

Cash returned to members was $49 million in 2011. Members received $41 million in equity retirements and $8 million of allocated patronage dividends

DFA reports 2011 financial results at meetingpaid in cash in 2011.

Earnings of affiliates were $39 mil-lion in 2011, and cash distributions from DFA affiliates totaled $27 million in 2011.

Net sales for DFA’s commercial operations were $3.4 billion in 2011 compared to $2.4 billion in 2010, an increase of $995 million, or 42 percent. The increase in net sales is the result of higher average commodity prices in 2011, resulting in higher pricing of products, and increased volumes along with the impact of 2011 acquisitions, the co-op says.

In addition, DFA’s Farm Services Division expanded by offering new services, new tools and more resources, including the Member Savings Network, which brings members savings and dis-counts on goods and services through partnerships with a variety of national companies.

Also during its annual meeting, DFA unveiled a new tagline, “More Coop-erative,” which underscores a commit-ment to delivering more resources for members, more quality for customers and more leadership in the industry, Mooney says.

“More Cooperative will mean differ-ent things to different people,” Mooney says. “To our customers, it means more quality and more value, and in our indus-try it means more leadership. To mem-bers, it means more resources, more markets, more services and more secu-rity. We’re all members of DFA for differ-ent reasons, but we’re all looking to get more value out of our cooperative.” CMN

PLYMOUTH, Wis. — Sargento Foods Inc. has announced plans to expand pro-duction space at its facility in Hilbert, Wis., which produces the company’s line of sauces.

Production space will be expanded by about 300,000 square feet at an es-timated cost of $12 million, according to the company. Work is set to begin in May, and sauce production is expected to begin in the new space by January.

The Hilbert facility also saw reno-vations in 2011, with the company expanding office space and wellness areas there. The company expects the upcoming production expansion will create 50 new jobs over the next five years.

Sargento says since 1991, it’s added 55,000 square feet to the Hilbert plant

Sargento Foods to expand plant in Hilbertand renovated another 15,000 square feet there.

The company also recently con-cluded a project that brought a 45,000-square-foot, three-story office building to its headquarters in Plym-outh, Wis. The addition connects with the other two buildings on its campus. The project included additional space for an on-site nurse practitioner and physical therapist.

“It will accommodate projected of-fice needs for the next five or six years,” says Barbara Gannon, vice president of communications and government affairs, Sargento.

Overall, the Plymouth campus is approximately 550,000 square feet of corporate office, manu-facturing and distribution. CMN

WASHINGTON — Total U.S. natural cheese stocks in cold storage totaled 987.4 million pounds Feb. 29, 2012, up 1 percent from Jan. 31, 2012’s 978.8 million pounds but down 5 percent from the 1.04 billion pounds in cold storage at the end of February 2011, according to data released Thursday from USDA’s National Agricultural Statistics Service (NASS).

U.S. American cheese in cold stor-age totaled 606.3 million pounds as of Feb. 29, 2012, down 1 percent from Jan. 31, 2012’s 612.03 million pounds and down 2 percent from the 621.02 million pounds in cold storage at the end of February 2011.

Swiss cheese in cold storage totaled

Total U.S. natural cheese stocks are down 5 percent in February compared to year ago

27.0 million pounds as of Feb. 29, 2012, up 4 percent from January 2012’s 25.9 million pounds but down 22 percent from the 34.6 million pounds in cold storage at the end of February 2011.

Stocks of other natural cheese in cold storage totaled 354.1 million pounds as of Feb. 29, 2012, up 4 per-cent from January 2012’s 340.8 million pounds but down 7 percent from Febru-ary 2011’s 379.7 million pounds.

NASS reports U.S. butter in cold storage as of Feb. 29, 2012, was 205.3 million pounds, a 21-percent increase from January 2012’s 170.3 million pounds and a jump of 48 percent above the 138.7 million pounds in cold stor-age at the end of February 2011. CMN

Reprinted with permission from the March 23, 2012, edition of CHEESE MARKET NEWS® © Copyright 2012 Quarne Publishing LLC; PH: (509) 962-4026; www.cheesemarketnews.com

6 CHEESE MARKET NEWS® — March 23, 2012

For more information please visit www.oldeuropecheese.com

NEWS/BUSINESS

For more information please visit www.mctdairies.com

RENY PICOT CHEESES, PROUDLY HAND-CRAFTED BY OLD EUROPE CHEESE1330 East Empire Avenue Benton Harbor, MI 49022 800.447.8182 269.925.5003 Fax: 269.925.9560

www.oldeuropecheese.com

The partners at Old Europe Cheese have been working diligently to create two mouth watering baked Brie combinations — Plain Baked Brie in Pastry and Cranberry, Apricot & Almond Baked Brie in Pastry.

Each baked Brie begins with Old Europe Cheese award-winning Brie which is then hand wrapped in the freshest puff pastry for that home-made appearance. And just like Reny Picot Brie, only the finest and freshest ingredients such as wheat flour, butter, eggs, milk and sugar are used to create the puff pastry. Plus the fillings used in the Cranberry, Apricot & Almond Baked Brie are so fresh you will swear they were just harvested.

When You Think Quality; Think Reny Picot

Reny Picot Introduces Baked Brie in Pastry!

Available in: Plain – 6/12 oz.Cranberry, Apricot & Almond – 6/15 oz.

All the baked Brie comes vacuum packed in a beautiful glossy, multi-colored box with a 60-day refrigerated shelf life. The baked Brie packaging has been designed so it can be merchandised in all types of coolers including in-lines so the boxes can stand up on end. Plus, as an added feature, the box protects the delicate puff pastry dough from artificial lighting

Reny Picot Introduces Baked Brie in Pastry!

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Come Visit Usin Booth #212

BENTON HARBOR, Mich. — The partners at Old Europe Cheese Inc. have introduced two combinations of Baked Brie: Cranberry, Apricot & Almond Baked Brie in Pastry and traditional Baked Brie in Pastry.

Old Europe Cheese says it uses the freshest wheat, flour, butter, eggs, milk and sugar to create the puff pastry in a new state-of the-art bakery at its facility in Benton Harbor, Mich.

“The freshness of the dough is amazing,” says Francios Capt, general manager, Old Europe Cheese.

Each Baked Brie begins with Old Eu-rope Cheese’s Brie, which is surrounded by fresh, hand-wrapped puff pastry that

Old Europe Cheese offers new Baked Briesadds a home-made appearance. The fruit filling is made in Old Europe’s bakery with fresh cranberries, apricots and almonds, the company says.

Baked Brie in Pastry is available in 12-ounce packages and Cranberry, Apricot & Almond Baked Brie is avail-able in 15-ounce packages. They are delivered vacuum packed in gloss boxes and have a 60-day refrigerated shelf life. The boxes protect the natural golden colors of the pastry wrap and allow for merchandising in all types of coolers — including in-lines as the box can be stood up on end.

For more information, visit www.oldeuropecheese.com. CMN

SOUTH RIVER, N.J. — El Ranchero Del Sur LLC, South River, N.J., is recall-ing El Ranchero Queso Fresco (Fresh Cheese), Los Corrales Queso Fresco en Hoha De Platano (Fresh Cheese in Banana Leaf) and El Ranchero Queso Oaxaca (String Cheese) because these cheeses have the potential to be contam-inated with Listeria monocytogenes.

The cheeses under recall were dis-tributed from Feb. 23 through March 14, 2012, through direct delivery to retail stores, supermarkets and restaurants in New Jersey and Pennsylvania. El Ranchero Queso Fresco and Los Cor-rales Queso Fresco en Hoha De Platano are packaged in 14-ounce plastic clam-shells, and El Ranchero Queso Oaxaca is packaged in a 14-ounce shrink wrap

El Ranchero Del Sur recalls three cheesesand 10-pound plastic loose wrap.

The New Jersey Department of Health and Senior Services warned the public last week not to consume any cheese products from El Ranchero Del Sur. On March 2, a pregnant woman was diagnosed with Listeria monocytogenes infection at a New Brunswick hospital. Subsequent investigation and product analysis by county and state officials confirmed the presence of presence of Listeria monocytogenes in a sample of Los Corrales Queso Fresco en Hoja De Platano.

El Ranchero Del Sur has ceased the production and distribution of these products and is working with the FDA to continue their investigation as to what may have caused the problem. CMN

INDIANAPOLIS — A bill recently enacted in Indiana instructs the state Board of Animal Health to conduct a study on farmers selling unpasteurized milk to consumers. Currently sales of raw milk for human consumption are illegal in Indiana.

House Bill 1129, a routine technical bill which mostly details the duties of the state chemist, directs the board to study the issue of raw milk sales to consumers

Indiana lawmakers pass bill that directs study of farmers’ sale of raw milk to consumersby farmers. According to the bill, this study must be concluded before Nov. 1, and the board should prepare a report of the study’s results no later than Dec. 1, 2012.

The bill says the animal health board shall present the report to the governor and the legislative council in an electronic format and make copies of the report available to the public.

The bill also clarifies that a person commits a Class A infraction if the per-

son knowingly engages in the distribu-tion of raw milk for use as a commercial feed for any species if the raw milk is not prominently labeled “Not for Human Consumption.”

Earlier this year, the Indiana State Assembly attached an amendment to the state chemist bill that would have allowed the sale of raw milk

directly to consumers at small farms. Indiana’s Senate passed the bill with this provision, but the State House of Representatives passed it without the raw milk amendment and sent it back to the Senate for consideration. (See “Several states look at legal avenues for raw milk sales” in the Feb. 17, 2012, issue of Cheese Market News.) CMN

Reprinted with permission from the March 23, 2012, edition of CHEESE MARKET NEWS® © Copyright 2012 Quarne Publishing LLC; PH: (509) 962-4026; www.cheesemarketnews.comReprinted with permission from the March 23, 2012, edition of CHEESE MARKET NEWS® © Copyright 2012 Quarne Publishing LLC; PH: (509) 962-4026; www.cheesemarketnews.com

March 23, 2012 — CHEESE MARKET NEWS® 7

For more information please visit www.dsm.com

Change isn’t easy. But when it results in higher quality, longer lasting cheese, it’s worth considering. When it puts more pro! t in your pocket, it’s a no-brainer.

Introducing Delvocid® XT3 liquid mold inhibitor. It’s a new way to deliver more e" ective natamycin protection for your shredded cheese. In fact, Delvocid® XT3 lets you eliminate costly production problems:

• No mixing required • No waste • No damage to seals or pumps • No microbiological issues • No uneven coverage problems

And while you’re eliminating those problems, you can enjoy increased yields and lower costs compared to using crystalline natamycin.Visit us at the International Cheese Technology Expo, booth 219, and let us run a savings model for you, using your numbers. More cheese yield. More e" ective mold protection. Lower costs. Change is good…Delvocid® XT3. Protection You Can Trust™.

info.food@dsm.com | www.dsm.com

And pocket the change.

Delvocid® XT3

A new way to keep it fresh

HARRISBURG, Pa. — The Profes-sional Dairy Producers of Wisconsin will sponsor a tour of innovative, progressive dairies throughout Pennsylvania April 11-12.

The six dairies on PDPW’s Pennsyl-vania Dairy Tour employ cutting-edge technology and continuously look for new ways to make the next pound of milk. Their owners and managers will share their management successes — as well as things that didn’t work.

Dairies on the tour include: Meadow-Vista Dairy, Bainbridge; Walmoore Holsteins Inc., Cochranville; Star Rock Dairy, Conestoga; Reich-Dale Farms Inc., Chambersburg; Mercer Vu Farms,

National dairy tour highlights PennsylvaniaMercersburg; and Mason Dixon Farms, Gettysburg.

In addition to dairy tours and net-working with progressive dairy produc-ers, tour participants will have access to other educational opportunities. John Frey, executive director, Pennsylvania Center for Dairy Excellence, will ad-dress how the Chesapeake Bay affects the Pennsylvania dairy industry, and Frank Day of Hershey Co. will share information about managing milk chocolate margins.

To learn more, or to register, visit www.pdpw.org and click on the “PDPW National Dairy Tour to PA” link, or call PDPW at 800-947-7379. CMN

HARRISBURG, Penn. — The Center for Dairy Excellence and the Penn State Extension Dairy Team will host a series of Dairy PROS meetings in April, offering dairy industry professionals the opportunity to gather new ideas and shared insight to benefit their dairy farm customers.

With milk prices falling nearly $4 per hundredweight, the focus of Dairy PROS meetings will be “Dairy Markets and Risk Management.”

Katie Krupa, Rice Dairy LLC; Tim Beck, Penn State Extension Dairy Team; and Alan Zepp, Center for Dairy Excel-lence; will discuss what has happened in the dairy commodity markets and offer strategies dairy farms can use to protect profits in the next 12 months.

“Historically dairy price markets have functioned on a three-year cycle, and 2012 is the final year in that cycle,” says Zepp. “As cow numbers grow and exports wane, the milk price has become more volatile, forcing all dairy farm families to consider risk management as an option for protecting their profits.”

Held in a roundtable setting, the meetings will give participants the opportunity to share what they are seeing in their respective regions and to gather information from each other that they can take back to benefit their dairy farm customers and clients. Also, part of the meeting, the “Take It to the Farm” section will include a look at Penn State’s “Managing Milk Margins” spreadsheet.

All meetings will be held from 8-9:30 a.m., with breakfast served at 7:30 a.m. Meeting dates and locations are as follows:

• April 20, Farm and Home Center, 1383 Arcadia Road, Lancaster.

• April 24, AgChoice Farm Credit office, 109 Farm Credit Drive, Cham-bersburg.

• April 25, Celebration Hall, 2280 Commercial Blvd., State College.

• April 26, King’s Restaurant, 1920 Leesburg Road, Grove City.

The cost of Dairy PROS meetings is partially offset by a grant from the Department of Labor & Industry’s Workforce Investment Board. A new approach to registering for Dairy PROS

Dairy PROS meetings to address price riskoffers an incentive to companies that support the center’s Allies for Advance-ment Program. If an organization is a supporter of the Allies for Advancement Program at any level above $250, any member of the organization can attend the Dairy PROS meetings at no charge. If the organization is not an Ally for Advancement, each member from that organization who attends the Dairy PROS meetings will be charged a $20 registration fee.

For more information, or to register, visit www.centerfordairyexcellence.org. Questions can be directed to Penn State Dairy Extension Team at 1-888-373-7232 or askdairyalliance@psu.edu. CMN

EVENTS

FDA will hold April labeling workshopSTILLWATER, Okla. — The FDA will hold a food labeling workshop to provide information about FDA food labeling regulations at the Oklahoma State University campus April 24-25.

Registration costs $400 and because space is limited, participants are en-couraged to register as soon as possible.

To register, complete the online registration form at www.fapc.biz/forms/foodlabeling.htm. Contact David Arvelo, FDA office of regulatory af-fairs, at 214-253-4952 or david.arvelo@fda.hhs.gov with questions. CMN

Reprinted with permission from the March 23, 2012, edition of CHEESE MARKET NEWS® © Copyright 2012 Quarne Publishing LLC; PH: (509) 962-4026; www.cheesemarketnews.com Reprinted with permission from the March 23, 2012, edition of CHEESE MARKET NEWS® © Copyright 2012 Quarne Publishing LLC; PH: (509) 962-4026; www.cheesemarketnews.comReprinted with permission from the March 23, 2012, edition of CHEESE MARKET NEWS® © Copyright 2012 Quarne Publishing LLC; PH: (509) 962-4026; www.cheesemarketnews.com

8 CHEESE MARKET NEWS® — March 23, 2012

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Comings and goings … comings and goingsKraft Foods Inc., Northfield, Ill., has

announced that Terry Lundgren and Jorge Mesquita have been appointed to its board of directors. Lundgren is chairman, president and CEO of Macy’s Inc. Mesquita is group president of new business creation and innovation for the Procter & Gamble Co. Kraft Foods also announced that current directors Ajaypal Banga and Richard Lerner, M.D., will not stand for re-election. Shareholders will elect 11 directors for one-year terms at the company’s annual meeting, which will take place May 23.

Members of Professional Dairy Pro-ducers of Wisconsin (PDPW), Fond du Lac, Wis., elected Linda White to a three-year term on its board of directors. White owns and operates Kinnamon Ridge Dairy with her family. Walter Meinholz and Keith York were re-elected to second terms on the PDPW board. Meinholz operates a 2,250-cow dairy in a partner-ship. York operates a 1,350-cow dairy and farms 650 acres in a partnership.

Johanson Transportation Service (JTS), Orange Park, Fla., has promoted Kyle Crilow to branch manager of the

company’s Southeast division. Crilow joined JTS in 2006 as a sales & logistics coordinator and was promoted in 2009 to account manager of the Midwest divi-sion. He helped develop new business for the corporate sales division and provided local service to national clients based in the Midwest. Chris DuBoise has been named sales & logistics coordinator for the company’s Midwest division located in Madison, Wis. He has 13 years transportation experience and was general manager at A One Trans-portation in Pinon Hills, Calif.

Richard Wagner, a dairy pro-ducer from Escalon, Calif., has been elected to serve as vice chairman of the executive committee of the California Milk Advisory Board (CMAB). Wagner began his career as a dairy producer in 1978. He milks 1,600 Holstein cows with his family at Wagner Dairy L.P. and is a mem-ber of a variety of industry groups, including Western United Dairymen, Producer Review Board, California Beef Council, and Stanislaus and San Joaquin County Farm Bureaus. CMN

PEOPLE

NEWS/BUSINESS

Milk Specialties Co. cited for violations by Occupational Safety and Health AdministrationFOND DU LAC, Wis. — The U.S. Department of Labor’s Occupational Safety and Health Administration (OSHA) recently cited Milk Special-ties Co. with three safety violations, including one willful violation for combustible dust hazards. OSHA says it opened an inspection follow-ing a report of a fire resulting from a dust explosion in a machine at the

company’s Fond du Lac, Wis., facility, which converts liquid whey products into dried whey protein concentrate powder. Proposed fines total $72,000.

Milk Specialties says in a state-ment provided by its General Counsel Joe Kang that this was an erroneous report, and there was no explosion at the Fond du Lac facility. Rather, the company says, a small piece of

milk product had begun to smolder, resulting in smoke. Milk Specialties says it has modified its equipment so this problem does not happen again.

In addition to the cited willful violation, the inspection found two other-than-serious violations involv-ing failing to properly maintain OSHA 300 logs for 2011 describing days lost by employees or days when work activities were restricted. OSHA says a willful violation is committed with intentional, knowing or voluntary dis-regard for the law’s requirements or indifference to employee safety and health, while an other-than-serious violation is one that has a direct relationship to job safety and health but probably would not cause death or serious physical injury.

As part of the inspection, OSHA subpoenaed a five-year strategic plan for combustible dust and a combustible dust review report prepared by Milk Specialties’ vice president of environmental health and safety. OSHA says Milk Special-ties Co. refused to provide the docu-ments, citing attorney/client and attorney/work product privileges. A U.S. district court ruled Feb. 8 that the documents constitute business advice and ordered the company to provide them to OSHA.

Milk Specialties Co. is part of Eden Prairie, Minn.-based Milk Specialties Global Food Solutions, which is a division of Carpentersville, Ill.-based Milk Specialties Global. Milk Special-

ties Global and its divisions operate additional manufacturing facilities in Adell, Boscobel and New Holstein, Wis., and in Mountain Lake, Minn.

Prior to this inspection, OSHA says it conducted multiple inspec-tions at the Wisconsin facilities and cited a total of 52 violations, includ-ing 48 in 2009 at a now-closed facility in Whitehall, Wis.

“This employer previously was cit-ed for failing to comply with OSHA’s safety regulations. Failing to take the appropriate precautions to protect workers from combustible dust ex-plosions and fires is an unnecessary risk,” says Frank Winingham, OSHA’s area director in Appleton, Wis.

Milk Specialties has formally contested the citations and says in its statement that says while it respects OSHA’s authority, it disagrees with the agency’s assertions.

“At Milk Specialties, our most important priority is to create high-quality milk products in a safe and healthy work environment. We are continuously improving our facilities and taking any necessary steps to ensure our facilities are safe for our valued employees” the company says. “As with all its facilities, the Milk Spe-cialties Fond du Lac facility closely follows the industry standards for worker protection and safety, and the facility meets the industry standards in all respects with numerous safe-guards in place to protect against any potential fire or combustion.” CMN

New legislation seeks to help N.Y. dairy farmers meet needs of Greek yogurt plantsWASHINGTON — U.S. Sen. Charles Schumer, D-N.Y., recently announced he is introducing new legislation that will help New York dairy farmers expand their operations to meet the rising de-mand for milk, which has been fueled by the boom in Greek yogurt.

Due to expansions and new projects including the Pepsi Project Wave plant, Alpina, Fage and Chobani, the New York Farm Bureau predicts that New York’s dairy farmers will have to expand their output by 15 percent to take advantage of the growing demand from Greek yogurt manufacturers in the state.

Schumer has announced plans to introduce the DAIRY (Dairy Augmen-tation for Increased Retail in Yogurt products) Act to help dairy farmers who wish to expand. The legislation would allow farmers who purchase cows already in production to write off the cows as a capital expense, and establish federal savings accounts targeted to help farmers save and grow during booms and weather market downturns.

Earlier this month, Schumer wrote a letter to Pepsi CEO Intra Nooyi urging the new owners of the Project Wave yogurt facility that will be built in

Batavia, N.Y., to source as much of the milk for their product as they can from New York’s dairy farmers.

“After a long period of trauma trig-gered by the economic collapse in 2008, the emergence of the Greek yogurt mar-ket, which requires intense amounts of high-quality milk, is a bright light at the end of the tunnel for New York’s long-suffering dairy farmers, and I will do all I can to make sure they benefit from this very positive new market,” Schumer says.

The New York Farm Bureau Presi-dent Dean Norton says he applauds Sen. Schumer for his proposed legislation. He says farm savings accounts are a good way to help New York’s dairy farmers to save when times are good in order to smooth out the bumps when the times are bad.

“New York’s abundant local milk sup-ply is drawing yogurt processors to New York like a moth to a flame, but we’ve got to make sure that our dairy farmers don’t get burned in the process,” Norton says. “Sen. Schumer clearly recognizes the importance of our multi-billion dol-lar dairy industry and the need for a free market solution to allow our milk supply to meet a growing demand.” CMN

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March 23, 2012 — CHEESE MARKET NEWS® 9

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10 CHEESE MARKET NEWS® — March 23, 2012

NEWS/BUSINESS

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NEW PRODUCTSF O R D A I R Y M A N U F A C T U R E R S

New DuPont Danisco starter cultures aim to increase production for cheesemakersCOPENHAGEN — DuPont Danisco says its researchers have developed new starter cultures, CHOOZIT FRESH, that can help cheesemakers boost capacity without increasing milk consumption or investing in extra equipment.

The starter cultures can extract up to 4 percent more curd from milk, which means a facility with a weekly milk con-sumption of 6.6 million pounds can add an extra 16.5 metric tons to its annual volume of fresh cheese production at no additional cost, the company says.

CHOOZIT FRESH cultures have a sta-ble pH, are bacteria resistant and have a fermentation time that is comparable to conventional starter cultures. They are designed for direct inoculation into vats and produce cheese with a clean, fresh flavor profile, the company adds.

“We found that the non-protein

nitrogen was the result of protein loss from the milk, caused by the high protein-degrading enzyme activity of the starter cultures, especially bulk starters, during fermentation,” says An-nie Mornet, global product manager of CHOOZIT, DuPont Nutrition & Health. “This protein loss has a direct negative impact on the dry matter content of the curd, reducing final product yield.”

CHOOZIT FRESH resulted from a screening process initiated by DuPont to identify culture strains with low enzyme activity.

“Our industrial trials have demon-strated excellent results with CHOOZIT FRESH. These also have been confirmed by an independent research institute,” says Mornet.

For more information, v is -i t w w w . d u p o n t . c o m . C M N

says the proposal “is attempting to bal-ance the budget on the backs of rural America.

“Agriculture has been ready and will-ing to do its part in reducing the federal deficit, but Rep. Ryan’s budget proposes total cuts to farm bill spending of more than $155 billion,” Johnson says. “This is $10 billion more than the agreement reached late last year in a bipartisan, bicameral manner by the House and Senate agriculture committees.”

In a statement released Tuesday, Sen. Kent Conrad, D-N.D., chair of the Senate Budget Committee, said he is “disappointed that Rep. Ryan is walking away from the discretionary spending levels agreed to by Democrats and Republicans in last summer’s Budget Control Act.

“The fact is the budget for the next

BUDGETContinued from page 1

fiscal year is already in place,” Conrad says. “The Budget Control Act provid-ed the key components of the budget for 2012 and 2013, including setting discretionary spending limits and providing the tools to enforce those limits.” (See “Congress passes com-promise to raise debt limit; Obama signs just before default deadline” in the Aug. 5, 2011, issue of Cheese Market News.)

Conrad and fellow Senate Democrats this week set discretionary spending limits for fiscal year 2013 and budget enforcement levels for the Senate through 2022. The “deeming” resolution adheres to the reduced discretionary spending levels established the Budget Control Act.

The action allows Senate Appropria-tions Committee Chair Daniel K. Inouye, D-Hawaii, to proceed with drafting spending bills for fiscal year 2013, and ensures the Senate will have the tools to enforce those limits when the bills

are considered, Conrad says. “The deeming resolution I filed for-

mally sets spending for 2013 at the levels Democrats and Republicans agreed to in last summer’s Budget Control Act, and ensures that we can enforce those levels,” Conrad says. “Those who continue to claim we do not have a budget are either not paying attention or are seeking to deliberately mislead the public.

Inouye adds that “the fact of the matter is that if the Republicans in the House abandon the deal we made in August, it will make it very difficult for the House and Senate appropriations committees to fulfill our duties. As we

saw last year, differing top-line numbers lead to needless delay and in the end, no one should doubt that the Senate will not move from the agreed-upon level of $1.047 trillion for discretionary spending. It is my sincere hope that House Republicans will not follow this path, and will instead honor the deal they made, and allow the two appropria-tions committees to move as many bills as possible through the regular order, and not force us, yet again, to turn to an omnibus appropriations bill at the end of the year.”

For more information on Ryan’s budget proposal, visit http://budget .house.gov/prosperity/ . CMN

CDFAContinued from page 1

processors, producers write to CDFA on potential hearing on Class 4b for-mula” in last week’s issue of Cheese Market News.)

The hearing will be held May 31 and June 1 in the Department Auditorium in Sacramento, Calif. The hearing will begin both days at 9 a.m.

CDFA says its final decision from this hearing will include consideration of all relevant economic factors including, but not limited to:

• The reasonableness and economic soundness of market milk prices for all classes, giving consideration to combined income from those classes, in relation to cost of production and marketing for all purposes including manufacturing;

• Whether prices will ensure an adequate and continuous supply, in relation to demand, of market milk for all purposes, including manufacturing purposes, at prices to consumers which,

when considered with relevant eco-nomic criteria, are fair and reasonable;

• Whether prices, including the pric-es of components of milk, established by the CDFA secretary for the various classes of market milk bear a reason-able and sound economic relationship to each other; and

• Whether the amendments would be in accord with all the purposes, policies and standards contained in the relevant sections of California laws and regulations.

California Dairies Inc. (CDI) has submitted a request that CDFA expand this public hearing to include the Class 4a pricing formula as well as Class 4b. CDI says it has been a standard practice for CDFA to allow proposed changes to the Class 4a and Class 4b pricing formulas to be received and considered within a single hearing.

“Simply, the manufacturing cost allowances should be consistent with actual costs for processing, and the but-ter commodity price should be adjusted by a factor that reflects what California plants actually receive for the products

they market,” says Eric M. Erba, senior vice president of administrative affairs, CDI.

CDI says CDFA should consider adjustments to the f.o.b. price adjuster for butter at the same time that it is con-sidering manufacturing cost allowance changes in the Class 4b pricing formula.

CDFA has not yet responded to this request.

CDFA says all interested parties are entitled to submit alternative proposals detailing alternative adjustments in the whey valuation of the Class 4b pricing formula. Alternative proposals must be signed by a responsible party and received by CDFA’s Dairy Marketing Branch no later than 4 p.m. on May 1. CDFA encourages all alternative proposals to be sent electronically via e-mail to dairy@cdfa.ca.gov or faxed to 916-900-5341. Alternative proposals also may be mailed to Hearing Officer, c/o CDFA Dairy Marketing Branch, 1220 N Street, Sacramento, CA 95814, but five business days in addition to normal mailing times should be allot-ted if mailed. At the hearing, CDFA will

receive both oral and documentary tes-timony and evidence. Interested parties who wish to introduce testimony and/or exhibits should provide the hearing officer seven copies of such documents for the official record and one copy for the court reporter.

Additionally, to assist interested persons in preparing for the hearing, a public workshop will be held May 15 in the Department Auditorium beginning at 9 a.m. At this workshop, interested persons can review and discuss all proposals submitted with CDFA staff and other interested par-ties. CDFA will supply background and limited analysis of the petitions and the alternative proposals submitted by the May 1 deadline. The workshop will be informal and educational in nature, and discussion during the workshop will not be part of the of-ficial hearing record or be considered in the decision.

Current hearing information, peti-tions posted to date and updates can be viewed at www.cdfa.ca.gov/dairy/dairy_hearings_matrix.html. CMN

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NEWS/BUSINESSMarch 23, 2012 — CHEESE MARKET NEWS® 11

NASSContinued from page 1

production.Adjusting for the 2012 leap day, per-

day production in February was up 4.3 percent over one year ago.

There were an estimated 9.25 million dairy cows on U.S. farms in February, 87,000 head more than in February 2011 and 9,000 head more than in January 2012.

NASS reports that U.S. milk produc-tion per cow averaged 1,760 pounds in February, 115 pounds more than in February 2011.

Production per cow in the 23 major states averaged 1,782 pounds in Febru-ary, 117 pounds above February 2011.

NASS says there were 8.51 million cows on dairy farms in the 23 major states in February, 102,000 head more than in February 2011 and 8,000 head more than in January.

California led the nation’s milk production in February with 3.51 billion pounds, up 11.9 from its production a year earlier. There were 1.78 dairy cows on California farms in February, up 28,000 head from a year earlier and up 2,000 head from a month earlier. Production per cow in California in February averaged 1,965 pounds, 165 pounds more than a year earlier.

Wisconsin followed with 2.17 billion pounds of milk produced in February, up 8.2 percent from last year’s produc-tion. There were 1.27 million cows on Wisconsin dairy farms in February, unchanged from a year earlier and up 1,000 head from a month earlier. Pro-duction per cow in Wisconsin averaged 1,715 pounds in February, up 130 pounds from February 2011.

Rounding out the top five milk-producing states in February were New York with 1.06 billion pounds, up 6.8 percent from a year earlier; Idaho with 1.04 billion pounds, up 7.9 percent; and Pennsylvania with 849 million pounds, up 3.5 percent. CMN

the year, high feed prices and favorable cow slaughter prices could encourage heavier culling of milk cows that could stop the increase in milk cow numbers,” Cropp adds. “Reduced returns over feed costs could also reduce the increase in milk per cow. How 2012 crops develop will be a major factor for the outlook for feed prices later on this year. Also, weather will continue to be an important factor in the level of milk per cow this summer and fall.”

USDA’s most recent “Livestock, Dairy, and Poultry Outlook” report says milk cow estimates were raised again this month, although herd size contraction is still expected later in 2012. Milk per cow also was raised above earlier forecasts based on the mild winter weather conditions. The milk production forecast was likewise increased.

PRICESContinued from page 1

“Weaker producer returns are expected to lower both cow numbers and yield per cow later in 2012. Milk prices, already forecast lower than 2011, were lowered further based on the higher forecast milk production for 2012,” the report says.

The report also notes that feed prices are expected to be higher during 2012 than last year.

“The corn price is expected to average $5.90-$6.50 per bushel for the 2011-12 crop year, an increase from the $5.18 average in 2010-11. The higher feed prices expected

this year will continue to pressure the milk-feed price ratio,” the report says.

Taking these factors into account, the report notes that prices for cheese, but-ter, nonfat dry milk (NDM) and whey are lowered this month.

The report shows cheese prices averag-ing $1.600-$1.660 per pound in 2012; butter prices at $1.510-$1.600 per pound; NDM prices at $1.345-$1.395 per pound; and whey prices at $0.570-$0.600 per pound.

Brown notes that oftentimes people will say that the market is cyclical and

compare 2012 to what happened to the dairy market in 2009.

“I see a lot of discussion about 2009, but I don’t think 2012 is anything like 2009,” he says. “It’s similar from a supply standpoint, but not a demand standpoint.

“In 2009 we had the economic downturn. We don’t want to downplay what happened in 2009 from a demand standpoint. We’re not there in 2012. We can all wish the economy were grow-ing at a faster rate, but we are seeing some positive signs,” he adds. CMN

Rabobank outlook: Global demand not keeping up with milk supplyUTRECHT, Netherlands — Exception-ally mild weather over the winter months has caused worldwide milk production, already supported by high milk prices, to grow even faster, outpacing demand, says the latest “Rabobank Dairy Quarterly: Trend and Outlook for the International Market.”

Rabobank says the opening months of 2012 saw international dairy prices fall between 3-8 percent, and the second quarter likely will see further downward pressure on world prices. Demand also will remain compromised by weak underlying economic conditions and only modest price relief for consumers, the report says.

In the United States, an unexpect-edly strong spurt of milk growth through January and February has exacerbated excess supply in the U.S. industry, Rabo-bank says. Domestic dairy sales are only marginally expanding. Decent growth in foodservice cheese sales has been largely offset by ongoing contractions in retail

sales volumes of all major product lines, as consumers respond to real wage falls, rising gas prices and inflation in the dairy case. Exports from the United States also have started to lose steam in the face of a tight world market, the report says, with shipments down 3 percent year-over-year in the three months to January.

Other parts of the world also are seeing increased production. European Union milk production was up 2.7 percent in January before a brief cold snap decreased February growth. Meanwhile, demand for additional dairy products remained weak in Europe in the face of rising unemploy-ment, falling real incomes, extreme uncertainty and high retail pricing. New Zealand milk production was up 9.4 per-cent in the three months to January due to exceptional growth conditions, farm expansions and high milk prices. New Zealand exports also have been strong, with January shipments 26.5 percent higher than a year ago. Milk production

in Australia and Argentina also rose in January, while Brazil was the only export region to see a contraction in milk supply through early 2012.

Rabobank says the global dairy market will continue to struggle to balance at current pricing levels through the second quarter, and consumption in key export regions will remain weak, with some dairy price relief offset by poor economic growth and rising fuel costs. While a further ex-pansion in import demand is expected to soak up much of this, leftovers will exert further modest downward pressure on world prices, Rabobank says.

However, the report predicts funda-mentals should rebalance through the second half of the year, though there is a risk of only weak price support at that stage given the prospect of significant stock accumulation if there is a strong supply peak in the Northern Hemisphere.

F o r t h e f u l l r e p o r t , v i s -it www.rabobank.com. CMN

Reprinted with permission from the March 23, 2012, edition of CHEESE MARKET NEWS® © Copyright 2012 Quarne Publishing LLC; PH: (509) 962-4026; www.cheesemarketnews.com Reprinted with permission from the March 23, 2012, edition of CHEESE MARKET NEWS® © Copyright 2012 Quarne Publishing LLC; PH: (509) 962-4026; www.cheesemarketnews.com

12 CHEESE MARKET NEWS® — March 23, 2012

NEWS/BUSINESS

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Prices down in latest gDT auction; comments invited on changes to shipment periodsAUCKLAND, New Zealand — The trade weighted index was down 4.5 percent, and prices for all commodities were down following the latest auction Tuesday on globalDairyTrade, Fon-terra’s internet-based sales platform.

The average price achieved across all contracts and contract periods for each commodity and change from the previous trading event are as follows:

• Milk protein concentrate: US$4,345 per metric ton FAS ($1.9709 per pound), down 15.0 percent.

• Rennet casein: 6,545 per metric ton FAS ($2.9688 per pound), down 12.9 percent.

• Cheddar: US$3,114 per metric ton FAS ($1.4125 per pound), down

11.3 percent.• Anhydrous milkfat: US$3,284 per

metric ton FAS ($1.4896 per pound), down 9.5 percent.

• Whole milk powder: US$3,316 per metric ton FAS ($1.5041 per pound).

• Skim milk powder: US$3,125 per metric ton FAS ($1,4175 per pound), down 2.0 percent.

No buttermilk powder was offered.The next trading event will be held

April 3. For more information, visit www.globalDairyTrade.info.

GlobalDairyTrade also recently an-nounced that it will change to monthly shipment periods starting with its May 1 trading event.

Since its inception in July 2008, gDT

has offered a mix of contracts involving both one-month and three-month ship-ment periods, which enabled buyers and sellers to lock in supply for a significant period while minimizing complexity of the bidding site through a limited number of contracts, gDT says.

The group adds that the downside of the current structure is that it results in an overlapping of the three-month shipment periods as auctions move for-ward from month to month. For bidders, this creates complexity in determining purchasing strategy, while for sellers, the overlapping creates complexity in determining offer profiles to achieve the desired total shipment profile, gDT says.

Interested parties may submit

comments on the proposal by April 3. Submissions should be made in writing to help@globaldairytrade.info with “Submission on proposed rule change” in the subject line.

The review of submissions re-ceived will be completed by April 8, and new rules are expected to be published on April 24, gDT says. CMN

FDA reports continued decrease of drugresidues in raw milkWASHINGTON — Only 0.021 per-cent of all truckloads of raw milk tested positive for medicinal animal drug residues in fiscal year 2011, ac-cording to FDA’s recently released National Milk Drug Residue Data-base (NMDRD) results.

The U.S. dairy industry tests each truckload of raw milk prior to use, notes the International Dairy Foods Association (IDFA). All truckloads of raw milk testing positive for violative drug residues are disposed of and not used to produce food for human consumption.

The amount of milk disposed of in fiscal years 2009-2011 continues a decline that began in fiscal year 2008, according to the NMDRD.

“Stronger on-farm animal care programs and intense testing at the dairy plant are continuing to show impressive decreases in the FDA-sponsored NMDRD database testing results for medicinal animal drug residues,” says Jonathan Gardner, IDFA vice president of regulatory affairs. “The program of testing every truckload of raw milk and disposing of those testing positive is very suc-cessful in maintaining confidence in dairy products and in the dairy industry.”

Of the 3,796,684 tests conducted during fiscal year 2011, a total of 3,748,809 were for beta-lactam drugs. Of those, 1,061 were positive, the report found.

Within the beta-lactam family, there were 102 tests for cloxacillin, none of which were positive, accord-ing to the report.

Also during fiscal year 2011, there were 24,755 tests for sulfonamides, five of which were positive, the re-port says. Within the sulfonamide family, there were 11,686 tests for sulfamethazine, four of which were positive.

There were 10,158 tests for tetra-cyclines during fiscal year 2011, 12 of which were positive.

In addition, there were 766 tests for enrofloxicin, one of which was positive; 362 tests for macrolides, none of which were positive; and 36 tests for aminoglycosides, none of which were positive, the report says.

The full report is available at http://www.kandc-sbcc.com/nmdrd/. CMN