FDA Sets July 26 Public Meeting, Nutrition Innovation Strategy Comments Sought

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CHEESE REPORTER Vol. 143, No. 2 • Friday, June 29, 2018 • Madison, Wisconsin

Senate OKs Farm Bill; Legislation Heads To Conference Committee

time,” said Jim Mulhern, NMPF’s president and CEO. “We are pleased that the two chambers now have the opportunity to harmonize their versions to produce a final bipartisan, bicameral bill that can be signed into law by Sept. 30.”

Also, the Senate farm bill includes language to establish and administer a milk donation pro-gram to reimburse eligible dairy organizations costs incurred for donating milk by accounting to the federal milk marketing order pool the difference in the Class I milk value and the lowest classi-fied price for the applicable month (either Class III milk or Class IV milk).

The bill provides $5 million for fiscal year 2019 and each fiscal year thereafter.

Another section of the bill would allow USDA to conduct pilot projects to test and evalu-ate methods that would improve diet quality, consistent with the Dietary Guidelines for Americans, through the increased purchase of fluid milk for SNAP participants that under-consume fluid milk.

• See Senate Farm Bill, p. 7

Agency Seeking Input On Modernizing Standards Of Identity, Icon To Denote ‘Healthy’ On Food LabelsWashington—The US Food and Drug Administration (FDA) will hold a public meeting on its recently announced Nutrition Innovation Strategy on Thurs-day, July 26, 2018, at the Hilton Washington DC/Rockville Hotel in Rockville, MD.

FDA is also accepting com-ments on the public meeting by Aug. 27, 2018. Electronic com-ments may be submitted at www.regulations.gov; the docket num-ber is FDA-2018-N-2381.

The July 26 meeting’s purpose is to give interested persons an opportunity to discuss FDA’s Nutrition Innovation Strategy, which was announced in late

March by FDA Commissioner Scott Gottlieb (for more details, see Standards of Identity, Sodium Among Keys In New FDA Nutri-tion..., on page 1 of our Mar. 30, 2018 issue by scanning the QR Code on page e of this issue).

“What we need is the policy framework that allows consumers to identify healthier options and the market forces to inspire the development of these opportuni-ties at a cost that’s affordable,” Gottlieb said this week.

“We already know consum-ers increasingly seek healthier options,” Gottlieb continued. “But our rules didn’t always allow disclosure of these features in a consistent format that let con-sumers easily access this informa-tion or that made it easy for food

• See FDA Strategy, p. 10

Citing ‘Grave Jeopardy’ Of US Cheese Exports To Mexico, Industry Asks Trump To Halt Tariffs On Mexican ProductsWashington—More than 60 dairy industry organizations and cheese and dairy companies on Tuesday urged President Trump to suspend steel and aluminum tariffs on Mex-ican products until the renegotia-tion of the North American Free Trade Agreement (NAFTA) is completed, particularly in light of Mexico’s willingness to construc-tively engage with US negotiators.

The letter to Trump was signed by several dairy industry associa-tions, including American Dairy Products Institute, Georgia Milk Producers, Inc., Idaho Dairymen’s Association, Illinois Milk Produc-ers’ Association, Indiana Dairy Producers, Iowa State Dairy Asso-ciation, Midwest Dairy Coalition, Milk Producers Council, Min-nesota Milk Producers Associa-tion, Missouri Dairy Association, National All-Jersey Inc., Nebraska State Dairy Association, North Carolina Dairy Producers Asso-ciation, Ohio Dairy Producers Association, Oregon Dairy Farm-ers Association, South Dakota Dairy Producers Association, South East Dairy Farmers Asso-ciation, Virginia State Dairymen’s Association, and Western United Dairymen.

Companies and cooperatives signing the letter included Agri-Mark, Associated Milk Producers Inc., Baker Cheese Factory, Bel Gioioso Cheese, Bluegrass Dairy

• See Mexican Tariffs, p. 4

Proponents Withdraw, Will Resubmit, Proposal For Multiple Component Pricing In Southeast, Appalachian OrdersWashington—Proponents of a proposal for a hearing to consider adoption of uniform multiple com-ponent pricing (MCP) plans for the Southeast and Appalachian federal milk marketing orders with-drew their proposal on Thursday.

“Marketing conditions in the Appalachian and Southeast Fed-eral Order Marketing Areas are in a state of flux, aggravated by challenging national dairy product markets,” Erick Metzger, general manager of National All-Jersey Inc. and proponent coordinating representative, said in a letter to Dana Coale, deputy administrator, USDA-AMS-Dairy Programs.

• See MCP Proposal, p. 6

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Bill Includes Changes To Dairy Risk Coverage, Milk Donation Program, Dairy Business Innovation ActWashington—The US Senate on Thursday approved its version of the 2018 farm bill, setting the stage for a House-Senate confer-ence committee to take up the leg-islation later this summer.

The House had approved its ver-sion of the 2018 farm bill late last week. The legislation now heads to a conference committee.

Congress has adjourned for the 4th of July recess, but leaders of both the Senate and House Agri-culture Committees say they want to convene a conference commit-tee soon after they return on July 9, according to the American Soy-bean Association (ASA).

“We are one step closer to pro-viding farmers and ranchers a farm bill with the certainty and predict-ability they deserve,” said US Sen. Pat Roberts (R-KS), chairman of the Senate Agriculture Commit-tee. “I am proud we have a strong, budget neutral farm bill with broad support.”

“The 2018 Senate farm bill proves that bipartisanship is a tried and true approach to getting things done,” said US Sen. Debbie Stabe-now (D-MI), the Ag Committee’s top Democrat.

The Senate farm bill replaces the Margin Protection Program (MPP), which was established under the 2014 farm bill, with the Dairy Risk Coverage program through 2023.

The bill contains enhancements to the program that had been sought by National Milk Producers Federation (NMPF); it raises the maximum covered margin to $9.00 per hundredweight and adjusts the minimum percentage of milk that can be insured.

It also includes an agreement reached between NMPF and the International Dairy Foods Asso-ciation (IDFA) on price risk man-agement. And it extends both the Dairy Forward Pricing Program and the Dairy Promotion and Research Program through 2023.

The Senate farm bill “includes important dairy policy improve-ments at a time when many farmers are facing a very tough economic

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The public is already skepti-cal enough of food safety, and the federal government, without put-ting food safety in the hands of the agency who’s main mission is to pro-mote agriculture.

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EDITORIAL COMMENT

An Interesting, But Flawed, Food Safety Consolidation ProposalOne huge advantage George Wash-ington had when he became the first US President is that he more or less started with a clean slate. That is, it was difficult for him to propose government reforms or reorganizations because there was nothing to reform or reorganize.

But pretty much every President since Washington has tried his hand at reforming the federal gov-ernment. Specific to agriculture, this usually takes the form of shift-ing some responsibilities and func-tions within the US Department of Agriculture; and specific to food safety, this generally takes the form of shifting some responsibilities and functions within the US Food and Drug Administration.

Of course, President Washing-ton had no such opportunities, since USDA wasn’t established until President Lincoln’s first term (in 1862, to be exact), and the modern FDA wasn’t established until President Teddy Roosevelt’s second term (in 1906, to be exact).

Notably, FDA’s origins actually date back to a single chemist at USDA back in 1862. FDA in its early years was known as the Divi-sion of Chemistry and then (after July 1901) the Bureau of Chemis-try. That agency’s name changed to the Food, Drug, and Insecti-cide Administration in July 1927. Three years later, the name was shortened to the current Food and Drug Administration.

FDA remained under USDA until 1940, when it was moved to the new Federal Security Agency. In 1953, FDA was again trans-ferred, to the Department of Health, Education, and Welfare. In 1980, the education function was removed from HEW to cre-ate the Department of Health and Human Services, FDA’s current home.

That brief history alone tells you a lot about past government reor-ganization efforts, since changes at FDA (or its predecessor agencies) took place during the administra-tions of Calvin Coolidge (1927), Franklin D. Roosevelt (1940),

Dwight D. Eisenhower (1953) and Jimmy Carter (1980).

Meanwhile, the idea of consoli-dating federal food safety functions into a single agency has been float-ing around Washington (the city) since at least President Nixon’s first term (maybe this should be referred to as reconsolidating fed-eral food safety functions, since FDA’s origins are in USDA).

Indeed, according to a 1994 report from the General Account-ing Office (GAO, which is now known as the Government Accountability Office), the con-cept of consolidating food safety activities was debated in 1972 in connection with a proposed bill to transfer FDA’s responsibilities, including its food safety activities, to a new independent agency called the Consumer Safety Agency.

The GAO’s position in 1994 was similar to the one it voiced in 1972; that is, it believed that a single independent food safety agency was the preferred approach, but also recognized the difficulties in establishing a new government agency.

The GAO also believed in 1994, as it did in 1972, that it is impor-tant for the federal food safety mis-sion to be housed in an agency that is not charged with responsibili-ties that might conflict, or appear to conflict, with its willingness to aggressively administer its public health protection responsibilities.

That meant keeping food safety from being consolidated into USDA. For example, the GAO in 1993 testified before a House sub-committee that food safety inspec-tions should not be consolidated under USDA because of the real or perceived conflict of interests with its role of promoting agriculture. Moving responsibility for all food safety to agriculture “would likely compound this problem.”

All of this brings us to June of 2018, when (as reported on our front page last week) President Trump proposed reorganizing USDA’s Food Safety and Inspec-tion Service and the food safety

functions of FDA into a single agency within USDA (by contrast, President Obama had proposed, in 2015, to consolidate FSIS with FDA’s food safety components to create a new agency at HHS).

Trump deserves credit for at least recognizing that a problem exists with federal food safety oversight. Indeed, he deserves credit for rec-ognizing that the entire executive branch of the federal government needs to be reorganized, which is why his reorganization plan ran some 132 pages (and most of the reorganization proposals, including the food safety proposal, only took up three or four pages).

But it doesn’t seem like mov-ing FDA’s food safety functions to USDA is the way to go. Among other things, as the GAO con-cluded long ago, housing a new Federal Food Safety Agency within USDA would present a potential conflict, given USDA’s role of pro-moting agriculture. The public is already skeptical enough of food safety, and the federal government, without putting food safety in the hands of the agency who’s main mission is to promote agriculture.

The GAO itself has believed, for decades, that a single, inde-pendent food safety agency is the preferred approach to reorganizing USDA and FDA food safety func-tions. Support for an independent food safety agency has also been voiced by some consumer organi-zations.

Legislation has also been intro-duced in both the House and Sen-ate in recent years that would have created an independent Food Safety Administration, but since the bills have been introduced by Democrats, with only Demo-crats co-sponsoring the measures, they’ve gotten nowhere.

Trump’s proposal is also prob-ably heading nowhere, given that Congress already has other, more pressing priorities, including pass-ing a farm bill. Maybe what’s needed is for a President to pro-pose what the GAO recommends: an independent food safety agency.

CHEESE REPORTERJune 29, 2018 Page 3

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Canadian Government To Invest Up To $910,355 To Help Quebec Cheese FirmCompton, Quebec—Canadian officials, including Minister of Agriculture and Agri-Food Law-rence MacAulay, announced a fed-eral investment of up to $910,355 to Fromagerie La Station to help the cheese company purchase and install robotic equipment to improve the quality of its products and enhance production capacity.

Fromagerie La Station’s ongoing expansion is expected to substan-tially increase demand for the milk it buys, lower production costs, expand markets in Quebec and Canada, and improve the compa-ny’s competitiveness.

Established in 2003 in Comp-ton, Quebec, Fromagerie La Sta-tion is a small-scale family business with 10 employees, specializing in four types of cheese (Alfred le Fer-mier, Comtomme, Chemin Hatley and a Raclette cheese). All of the production is certified organic.

“This project will allow us to extend the ripening time for our certified organic farmhouse cheeses and to continue growing our com-pany,” commented Simon-Pierre Bolduc, director general, Fromag-erie La Station. “Acquiring the automation system and expand-ing our ripening rooms will help us meet the growing demand for locally produced ripened cheeses and respond to European competi-tion in this niche market.

Fromagerie La Station’s expan-sion and automation project is

supported by the Dairy Process-ing Investment Fund, a $100 mil-lion, four-year (2017-21) program designed to help dairy processors modernize their operations to improve their productivity.

The Dairy Processing Invest-ment Fund was established to pro-vide funding to dairy processors for investments that will improve productivity and competitiveness, and help them prepare for mar-ket changes resulting from the Canada-European Union Com-prehensive Economic and Trade Agreement (CETA).

“The government of Canada is proud to contribute to the dairy processing industry’s moderniza-tion, competitiveness and new market development, fostering growth and prosperity for the sec-tor,” MacAulay said.

USDA Announces Purchase Contract Awards For 9.1 Million Pounds Of Natural American CheeseKansas City, MO—USDA’s Agricultural Marketing Service (AMS) today announced pur-chase contract awards for a total of 9,131,400 pounds of natural American cheese for delivery in July, August and September 2018.

The cheese is being purchased in support of USDA/domestic food distribution programs.

USDA last month had announced plans to purchase up to $20 million worth of Cheddar cheese for nutrition assistance programs using a new streamlined process. The invitation that was released on June 14 was for a total of 9,677,400 pounds of Cheddar cheese.

The purchase contract awards announced today are for totals of: 491,400 pounds of yellow

Cheddar chunks, 12/1-pound pack-ages, at a price range of $2.2388 to $2.3948 per pound (total dollars: $1,150,117.92); 6,220,800 pounds of yellow

shredded Cheddar, 6/5-pound bags, at a price range of $1.9145 to $2.1018 per pound (total dollars: $12.469,378.56); and 2,419,200 pounds of yel-

low shredded Cheddar, 6/2-pound packages, at a price range of $2.2241 to $2.4450 per pound (total dollars: $5,695,451.40).

The total value of the purchase contract awards was $19.3 million.Contract awards were as follows:

Associated Milk Producers, Inc.: a total of 3,955,200 pounds of yellow shredded Cheddar 6/5-pound bags, at a total price of $7,866,259.22.

Bongards’ Creameries: a total of 1,075,200 pounds of yellow shred-ded Cheddar 6/2-pound package, at a total price of $2,580,704.52.

Dairy Farmers of America: a total of 2,073,600 pounds of yellow shredded Cheddar 6/5-pound bags, at a total price of $4,219,756.81.

Masters Gallery Foods: a total of 192,000 pounds of yellow shred-ded Cheddar, 6/5-pound bags; 491,400 pounds of yellow Ched-dar chunks, 12/1-pound packages; and 1,835,400 pounds of yellow shredded Cheddar, 6/2-pound packages. The total contract was for 2,027,400 pounds at a price of $4,648,227.39.

The AMS contracting officer will not consider any additional or further offers under this solicita-tion.

Questions and additional information may be obtained by contacting Trevor Wilson, the contracting officer’s representa-tive, at (816) 926-1564; email trevor.wilson@ams.usda.gov.

CHEESE REPORTERPage 4 June 29, 2018

from our archives

50 YEARS AGOJune 21, 1968: Cross Plains, WI—Zander’s Creamery here has proposed that a separate classification be made for its butterfat-vegetable spread so the product can be sold in Wisconsin without the 5.25-cent per pound tax now imposed. Since May 1, the Zander product, Butterine, has been subject to the state tax that applies to oleomargarine.

Washington—The development of two new whey-based bever-ages – one containing whey and cream and the other containing whey and soy flour with citrus flavoring, were introduced here this week by Eugene Guy at a special ADSA meeting.

25 YEARS AGOJune 25, 1993: Washing-ton—USDA’s Ag Marketing Service published a final deci-sion adopting a plan for pricing milk on the basis of its protein, as well as butterfat, components for the Ohio Valley, Eastern Ohio-Western Pennsylvania and Indiana federal milk mar-keting orders. For the first time in the federal order system, the proposed pricing plan includes adjustments to the protein price based on the somatic cell count of producer milk.

York, PA—The new Clinton administration provides a new opportunity for dairy farmers and other members of the dairy industry “who never talk with each other to sit down in the same room and discuss problems facing the dairy industry,” said US Sen. Patrick Leahy (D-VT) here this week at the National Dairy Summit.

10 YEARS AGOJune 20, 2008: Washington—The USDA published a tenta-tive partial final decision that proposes higher make allow-ances and increases the butterfat yield factor used in Class III and Class IV product price formulas. USDA is proposing to increase the make allowance for cheese from 16.82 to 20.03 cents per pound.

Greeley, CO—The city of Gree-ley here has signed an agreement with Denver-based Leprino Foods Company that secures the devel-opment of a new Leprino cheese and whey production facility here. Phase one of the project will be at least $270 million.

Mexican Tariffs(Continued from p. 1)

and Food, Bongards Creameries, California Dairies, Inc., Cayuga Milk Ingredients, Commercial Creamery Co., DairyAmerica, Dairy Farmers of America, Ells-worth Cooperative Creamery, FarmFirst Dairy Cooperative, First District Association, Foremost Farms USA, Glanbia Nutrition-als, Great Lakes Cheese, Hilmar Cheese, Hoogwegt US, Inc., Idaho Milk Products, International Ingredient Corporation, Klond-ike Cheese, Lactalis American Group, Land O’Lakes, Leprino Foods, Maryland & Virginia Milk Producers, MCT Dairies, Michi-gan Milk Producers Association, Northwest Dairy Association/Dari-gold, O-AT-KA Milk Products Cooperative, Pacific Cheese, Prai-rie Farms Dairy, Sargento Foods, Sartori Company, Savencia Cheese USA, Select Milk Producers, Sch-reiber Foods, Schuman Cheese, St. Albans Cooperative Creamery, Swiss Valley Farms, T.C. Jacoby & Company, Tillamook County Creamery Association, Trugman-Nash, United Dairymen of Arizona, Upstate Niagara Cooperative, and Valley Queen Cheese Factory.

The companies and organi-zations expressed appreciation to Trump for his leadership and willingness to fight on behalf of US agriculture for equitable trade. Trump’s insistence that Canada, for example, open its closed mar-ket to US dairy and halt market-distorting pricing schemes “is both commendable and refreshing.”

Unlike Canada, Mexico has long been a model for open dairy trade with the US, the letter noted. Through investment and coopera-tion with Mexico, “we have suc-

ceeded in becoming the country’s biggest foreign dairy supplier, with cheese purchases last year alone totaling nearly $400 million.” Today, Mexico accounts for about one-quarter of foreign demand for US dairy products “and is our most reliable trading partner.

“Unfortunately, our share of the Mexican market is in grave jeop-ardy,” the letter continued. Mex-ico included US cheeses on its list of products now subject to tariffs in retaliation for US actions on steel and aluminum imports. These tariffs on US cheeses, which will reach as high as 25 percent, will diminish foreign demand for US dairy products.

“Worse yet, our competitors in the European Union will use this opportunity in the wake of their recently concluded Free Trade Agreement with Mexico to gain market share. Allowing Mexico’s cheese tariffs to remain in place will greatly assist the EU in a market where the US has long been the leading supplier,” the letter stated.

The US dairy companies and groups asked that the Trump administration focus US efforts on working collaboratively with Mex-ico to find a mutually agreeable way forward, “and we believe plac-ing tariffs on hold in the interim would prevent the loss of hard-earned market share to the EU.”

The US Dairy Export Coun-cil (USDEC), International Dairy Foods Association (IDFA), National Milk Producers Fed-eration (NMPF) and Wiscon-sin Cheese Makers Association (WCMA) all support the goals set forth in the letter to Trump.

The first four months of 2018 showed a “strong expansion” in the volume of US dairy exports into Mexico, said Tom Vilsack,

USDEC’s president and CEO. Among other products, during 2018’s first four months, US nonfat dry milk exports to Mexico totaled 240.7 million pounds, up 20 per-cent from a year earlier; and US cheese exports to Mexico totaled 72.6 million pounds, 6 percent higher than a year earlier.

“But these tariffs have introduced uncertainty and concern. A renego-tiated NAFTA 2.0 would go a long way toward restoring our industry’s momentum,” Vilsack said.

“Maintaining dairy market access in Mexico is IDFA’s num-ber one priority in the NAFTA modernization efforts, specifically because the duty-free access has allowed trade between our coun-tries to flourish and Mexico to become our number one export market,” said Michael Dykes, IDFA’s president and CEO. “We’re confident that the administration and US negotiators will find a way to preserve this vital partnership, which allows the US dairy industry to create more jobs and drive our economy.”

“After rising during the spring, dairy futures markets and the farm-level milk price outlook for the rest of 2018 have deteriorated signifi-cantly in recent weeks, in reac-tion to the prospecrts of lost dairy export sales,” said Jim Mulhern, NMPF’s president and CEO.

“Our cheese manufacturer mem-bers with export sales are express-ing concern that their customers may turn sales over to competitors in the European Union,” said John Umhoefer, the WCMA’s execu-tive director. “Farms in Wisconsin and around the US need free-flow-ing trade and export growth, not collapse, if they’re going to climb out of a three-year slump in farm-level milk prices.”

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CHEESE REPORTERJune 29, 2018 Page 5

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EU Launches Trade Talks With New Zealand, Australia; First Rounds Set For JulyCanberra, Australia, and Wel-lington, New Zealand—Officials from the European Union (EU) and Australia early last week offi-cially launched negotiations for a comprehensive trade agreement between the EU and Australia.

Following that announce-ment, the first formal round of talks between the respective sides’ teams of negotiators will take place in Brussels, Belgium, from July 2-6.

“I look forward to adding Aus-tralia to our ever-expanding circle of like-minded trade partners,” said EU Trade Commissioner Cecilia Malmstrom. “In challenging times, it is heartening to see that Aus-tralia shares our commitment to a positive trade agenda, and to the idea that good trade agreements are a win for both sides.”

Three days later, in Welling-ton, New Zealand, Malmstrom and New Zealand Trade Minister David Parker officially launched talks for a comprehensive trade agreement. The first formal round of talks between the respective sides’ teams of negotiators will take place in Brussels from July 16-20.

“This agreement is an excel-lent opportunity to set ambitious common rules and shape global-ization, making trade easier while safeguarding sustainable develop-ment,” Malmstrom said.

“The EU is one of New Zealand’s largest economic partners. We share significant history, culture and values, and yet we currently discriminate against each other on trade. I’m pleased that this anom-aly will soon be addressed,” Parker said.

More Australian Exports UnlikelyAustralia will be working to secure better access for Australian food and agriculture products, creating the framework for open, fair and equitable trade, according to Aus-tralian Prime Minister Malcolm Turnbull and Australian Trade Minister Steven Ciobo.

A range of Australian agricul-tural exports to the EU, includ-ing cheese, are “significantly constrained” by EU tariff quotas, according to the Australian gov-ernment, which will aim for full tariff liberalization of agriculture in the trade agreement, while noting that negotiations on some agricul-tural products will be “particularly difficult.”

According to a 2017 report from Australia’s Department of Agriculture and Water Resources, an Australia-EU free trade agree-ment (FTA) would be “unlikely” to increase dairy product exports to the EU in the short term.

EU dairy product consumption is relatively stable and domestic production continues to increase in several member countries, the

Products not subject to TRQs usually face either specific or com-pound tariffs, the report continued. Specific tariffs are charged as a flat rate per ton imported. Compound tariffs are specific tariffs combined with an additional measurable component of the product, such as the concentration of lactic matter.

For example, imports of skim and whole milk powders are sub-ject to compound tariffs, according to the report. These are calculated according to the concentration of lactic matter in the powder at a rate of 1,190 euros per ton of lactic matter, in addition to a tariff of 1,254 euros per ton product weight. The ad valorem equivalent of the specific component of the tariff on skim milk powder is around 69 percent at 2015-16 average world prices.

EU tariffs on dairy products reduce the competitiveness of imported products compared with domestic products, the report said. Further, high in-quota tariffs and the burden of the quota adminis-tration can impose further costs on importers. As a result, most EU import quotas for dairy prod-ucts were not filled in the 2012-13 marketing year.

The EU applies strict sanitary and phytosanitary (SPS) stan-dards to the production of all dairy products intended for sale in the EU. To meet the EU SPS import standards, non-EU dairy export-ers must complete several stages of inspection, testing and accredita-tion before shipment.

Geographical indications (GIs) are designed to signal to consumers that products labeled with certain terms originate from a specific geo-graphic area and in the case of the EU have been produced accord-ing to methods and in conditions

set out in the EU GI registration system. Production in the EU pre-vents producers who do not meet the specific criteria from using these terms, and producers can use GIs to target premium markets for their products.

“In challenging times, it is heartening to see that Australia shares our commitment to a positive trade agenda, and to the idea that

good trade agreements are a win for both

sides.”

—Cecilia Malmstrom, EU Trade Commissioner

However, the report noted, GIs can be contentious because some products originally produced in particular regions, such as Parme-san cheese (as a translation of Par-migiano Reggiano) are now made all over the world.

The European Union considers that products produced accord-ing to the conditions specified in the EU registration are genu-ine, while New World producers believe many of these terms are now generic and describe a style or type of product rather than an indication of origin.

The recognition and enforce-ment of GIs has been key in recent free trade negotiations between the EU and other countries, the report said. In its free trade negotiations, the EU usually seeks protection for certain product terms, including for some that non-EU producers consider generic.

report pointed out. The exist-ing trade barriers for Australian dairy exports and weak European demand for imported dairy prod-ucts are likely to continue to con-strain Australian dairy exports to the EU.

The EU is currently a “minor market” for Australian dairy prod-ucts, the report noted. Australian exports to the EU peaked in 2000-01 at $189 million, 6 percent of Australia’s dairy exports. Ched-dar cheese was the main product exported. Since then, Australian dairy exports to the EU have fallen steadily, reaching $7.3 million in 2015-16 and comprising less than 1 percent of total Australian dairy exports.

By comparison, the real value of Australian imports of EU dairy products has increased by almost 130 percent since 2000-01 and reached $206 million in 2015-16. The EU was the second-largest supplier of dairy products to Aus-tralia, behind New Zealand.

Cheese is the main product imported from the EU, with Ched-dar dominating imports ($67 mil-lion), followed by Blue cheese ($23 million) and Feta ($23 million).

The EU operates a “complex” tariff system for dairy products that has relatively high applied tar-iffs, restrictive quotas and several non-tariff trade barriers, that 2017 report noted. Countries that do not have preferential agreements but export dairy products to the EU face several tariff-rate quotas (TRQs) with high in-quota tariffs. The EU’s domestic support policies have changed considerably since 2000, but its TRQs have remained largely unchanged since 1994.

CHEESE REPORTERPage 6 June 29, 2018

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MCP Proposal(Continued from p. 1)

“While none of these variabilities in marketing conditions lessens in any way the need for, or the pro-ponents’ support for multiple com-ponent pricing in the two Orders, resources needed to advance our case for MCP in the two Orders must be redeployed to handle pressing day-to-day marketing issues,” Metzger stated in his letter to Coale.

Proponents anticipate resub-mitting the MCP hearing proposal when the current marketing chal-lenges have stabilized and resources necessary to advance the proposal again become available, Metzger added.

Fourteen dairy cooperatives and several state and national dairy producer trade associations had asked USDA in early April to hold a hearing to consider adopt-ing MCP plans for the Southeast and Appalachian federal orders.

Two Alternative Proposals OfferedIn early May, before deciding whether or not to call a hearing, USDA provided an opportunity for interested parties to submit additional proposals regarding MCP plans in the Southeast and Appalachian orders. The agency received two proposals before the June 1st deadline.

One proposal was from The Kroger Co., which said it supports the proposed hearing on multiple

component pricing for the South-east and Appalachian orders.

Kroger asked USDA to also include a proposal to reduce the required amount of Class I sales for a distributing plant from 50 percent to 25 percent, to allow for growth of other dairy product manufacturing.

This proposal would allow plants that process Class I milk to expand other dairy processing capacity at the same site with less risk of losing pool plant status. In turn, Kroger believes it can provide additional opportunities to grow local milk demand.

The current restriction limits the amount of Class II, III, and IV product manufacturing that can be done by plants also processing packaged fluid milk to less than 50 percent of total sales by vol-ume, Kroger noted. As milk sup-plies stabilize and the outlook for fluid milk continues to decline, companies like Kroger are looking for ways to use capacity by growing manufacturing or finding outside sales opportunities.

In Kroger’s case, it has grown Class II manufacturing in three of the company’s five distributing plants located in the southeastern US.

In recent times, with produc-tion stabilizing, the need for additional local processing capac-ity has become more apparent, Kroger noted. Many dairy compa-nies operate multiple plants in a region, and Class II production has

become more concentrated in spe-cific plants for efficiency reasons.

Kroger believes its proposal would not increase costs to any individual plants, but would enable plants to maintain their pooling rights if their product mix changes, enabling them to operate more efficiently. Class I handlers would have more flexibility when plan-ning for business growth, creating less regulatory risk due to lower Class I sales.

With additional manufacturing growth, all dairy producers would have the opportunity for larger local markets for milk, lower-ing trucking and balancing costs, Kroger added.

The Tennessee Dairy Produc-ers Association opposed the MCP proposal, based on the proposition that the majority of dairy producers in both the Southeast and Appala-chian federal orders would be nega-tively affected.

However, should a hearing be granted on the MCP proposal, the Tennessee Dairy Producers Asso-ciation did request a pre-hearing for further discussion, clarification and support of its proposal to adopt state-unit pooling such as has been used for the Northeast federal order.

This proposal addresses how out-of-area milk is qualified as producer milk, the association said. The out-of-area milk has to qualify on its own merit and cannot use in-area sales or milk movement to qualify that milk, so it must meet its own performance units separately.

That is part of the reason it is used, so that if milk is really needed and it performs to the market, it can be pooled. If it is not needed and does not meet the standards on its own then it would not be pooled, the association said.

Germany’s Hochwald Planning Production Site For Long-Life Dairy ProductsThalfang, Germany—The Hochwald Cooperative Group is planning a new production site for long-life dairy products in North Rhine-Westphalia.

The unpasteurized milk that will be processed in the new facility stems from members of the cooperative. Approximately 1,250 farmers of the total 3,000 supplier members are within the catchment area of the new site.

The construction of a new dairy is part of the cooperative’s long-term strategy. With the Hochwald 2020 strategy, the company is continuing its devel-opment to become an interna-tional, market-orientated dairy products specialist.

Hi-Tech Pharmaceuticals To Collaborate With Fairmont Creamery On Whey, Milk ProteinsNorcross, GA—Hi-Tech Phar-maceuticals Inc. has reached an agreement with Fairmont Creamery on collaboration for the development of cutting-edge whey and milk proteins.

Fairmont Creamery’s research and development department will also help develop Hi-Tech’s new Fairmont Creamery line of ice cream-flavored protein.

The protein craze keeps get-ting larger, Hi-Tech Pharma-ceuticals noted. It may mean different things to different peo-ple, but the trend is here to stay.

CHEESE REPORTERJune 29, 2018 Page 7

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Senate Farm Bill(Continued from p. 1)

“Managing price risk and increas-ing consumption are the dairy industry’s key priorities, and we’re pleased that the Senate and House will enter conference consider-ations with agreement on these key provisions,” said Michael Dykes, IDFA’s president and CEO.

“We applaud the passage of the Senate’s farm bill version, as it draws much-needed attention to the needs of our dairy farmers, especially here in the Midwest,” said Jeff Lyon, general manager of FarmFirst Dairy Cooperative.

“Senate leadership have listened to the concerns we shared one-on-one, creating a new farm bill that will hopefully provide the right support when farmers need it,” Lyon continued. “Now, we’ll work with members from the House and Senate to work out their differ-ences to get a farm bill that ben-efits all of production agriculture.”

“The Senate pushed the farm bill one big step closer to the finish line today and it could not have come at a better time. America’s farmers and ranchers continue to face a challenging agricultural economy, a shaky outlook for our export markets and a dire ag labor shortage. It was time for some good news and the Senate delivered it in bipartisan fashion,” commented Zippy Duvall, president of the American Farm Bureau Federa-tion.

“Of course, no bill is ever per-fect, but this bipartisan effort gives us a solid framework for progress,”

Duvall added. “We look forward to working with conferees from both houses to get the best possible farm bill done for rural America.”

“We are appreciative of the Senate’s work on this bill and are pleased by its passage. At a time of great financial stress, family farmers and ranchers are in need of some economic certainty,” said Rob Larew, senior vice president of public policy and communi-cations at the National Farmers Union.

“The Senate’s version of the farm bill includes encouraging pro-visions that strengthen the farm safety net, promote farm sustain-ability, and ensure access to fair and diverse markets, all of which would provide essential security,” Larew continued.

Dairy Business InnovationThe Senate farm bill also includes provisions of the Dairy Business Innovation Act, which was intro-duced as separate legislation last week and is supported by IDFA, NMPF, the Wisconsin Cheese Makers Association, Wisconsin Specialty Cheese Institute, Mid-west Dairy Coalition, Associated Milk Producers, Inc., Ellsworth Cooperative Creamery and First District Association.

Under that section of the Sen-ate farm bill, USDA would estab-lish not less than three regionally located dairy product and busi-ness innovation initiatives for the purposes of: encouraging the use of regional milk production; creating higher-value uses for dairy products; promoting busi-

ness development that diversifies farmer income through processing and marketing innovation; diver-sifying dairy product markets to reduce risk; and leveraging federal resources by encouraging entities that host initiatives and partners of those entities to provide match-ing funds.

Under the legislation, an initia-tive would have to be located in a region with a history of dairy farm-ing; must be positioned to draw on existing dairy industry resources, including research capacity, aca-demic and industry expertise, a density of dairy farms or farmland suitable for dairying, and dairy busi-nesses; may serve a certain product niche, such as artisan cheese, or serve dairy businesses with dairy products derived from a specific type of dairy animal, including dairy products made from cow milk, sheep milk, and goat milk; and must serve dairy businesses in other regions.

Any of the following entities could submit to USDA an appli-cation to host an initiative: a state agriculture department or other state entity; a nonprofit entity with capacity to provide consulta-tion, expertise, and grant distribu-tion and tracking; an institution of higher education; or a cooperative extension service.

Trade-Related ProvisionsIn the trade area, the Senate’s farm bill consolidates the Mar-ket Access Program, the Foreign Market Development Coopera-tor Program, the E. (Kika) De La Garza Agricultural Fellow-

ship Program, and Technical Assistance for Specialty Crops to create a new Priority Trade Pro-motion, Development, and Assis-tance program.

In remarks on the Senate floor Wednesday, US Sens. Bob Corker (R-TN), chairman of the Senate Foreign Relations Committee, and Pat Toomey (R-PA), sought an up-or-down vote on their farm bill amendment that would require the President to submit to Con-gress any proposal to adjust imports in the interest of national security under Section 232 of the Trade Expansion Act of 1962.

The request for a vote was blocked by US Sen. Sherrod Brown (D-OH), according to Corker.

“Tariffs are a tax on the Ameri-can people, and as additional retal-iatory measures take effect on July 1 and July 6, the harm being done to the US economy, businesses and consumers will only get worse,” Corker commented.

Earlier this week, 51 national trade organizations and 222 state and local chambers joined the US Chamber of Commerce in sending a letter to US senators urging them to support the Corker-Toomey tar-iff amendment.

“The US business and agri-culture communities are deeply concerned that the President’s unrestricted use of section 232 to impose tariffs may not be in the national interest,” said the let-ter, which was signed by, among others, the National Retail Fed-eration, National Confectioners Association, and the Global Cold Chain Alliance.

CHEESE REPORTERPage 8 June 29, 2018

PERSONNEL

Mark Litchfield Tapped As RELCO’s New VP Of Sales & MarketingWillmar, MN—With more than 19 years of food and dairy indus-try experience, Mark Litchfield has been named the new vice p r e s i d e n t of sales and m a r k e t i n g for RELCO here.

In his new role, Litch-field will use his dairy industry pro-f i c i e n c i e s to focus on developing goals, executing plans for strategic growth, and build-ing relationships with cheese and dairy processors at both regional and global levels.

Litchfield began his career in dairy plant operations in his native home of New Zealand. From 1997 to 1999, he worked in dairy system design and installa-tion in the Asia Pacific region.

In 1999, he relocated to Den-mark and worked as a worldwide business line manager in mem-brane filtration. After relocating to Minnesota in 2004, Litchfield was named director of dairy sepa-ration technology at GEA Equip-ment.

At GEA, he was responsible for the team working with stan-dardized and partially custom-ized equipment offerings for the dairy segment in North America focused on mechanical separation technology.

“Mark has a proven track record and extensive experience in the global dairy industry,” said RELCO president Loren Corle. “Mark’s knowledge of dairy pro-cessing and technology, together with his business and marketing expertise, will help RELCO reach their goals and build business in new markets.”

LEON CLEMENT will join Synlait Milk Ltd. as CEO, effective mid-August, succeed-ing co-founder and inaugural CEO JOHN PENNO after his

announcement last November to step down. Having held senior leadership positions throughout his career, Clement most recently served as managing director of Fonterra Brands New Zealand. Before that, he was managing director of Fonterra Brands Sri Lanka and Indian Subcontinent.

JENNIFER TUCKER has been appointed deputy administrator of USDA’s National Organic Program (NOP), part of the Mar-keting and Regulatory Programs mission area. Tucker has served as associate deputy administra-tor for NOP since 2011. Before joining USDA, she served as a group facilitator and organization development consultant, working primarily with scientific and tech-nical government and non-profit organizations.

JOHANNA MIRENDA will join the Organic Trade Associa-tion (OTA) on Aug. 6 as its new farm policy director. She succeeds NATE LEWIS, who will return to his Washington state organic farm after serving four years on the OTA staff. Mirenda has served as technical director for the Organic Materials Review Institute (OMRI) since 2015. Prior to that, she was policy director for Penn-sylvania Certified Organic from 2012 to 2015. In her new role, Mirenda will help develop policy strategy through producer engage-ment, serving as primary staff to OTA’s Farmers Advisory Council and building relationships with the organic farming community.

Vault Technologies has hired GRANT CUPPS as chief techni-cal officer. Cupps built the origi-nal iteration of Vault’s software. Before joining the company, he spent six years building trading systems at OptionsCity.

KIM ELLIS has been named vice president of franchise develop-ment for Bruster’s Real Ice Cream. Ellis was previously a senior consultant for Michael Seid & Associates Worldwide, vice president of corporate devel-opment at Process Peak and vice president of online strategy for Hot Dish Advertising.

E-mail: ken@fiberglasssolutions.us

For more information, circle #14 on the Reader Response Card on p. 14

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HP Hood Completes $36 Million Expansion Project At Milk Products Plant In Oneida, NYOneida, NY—HP Hood, a leading dairy and food manufacturer, has completed a $36 million expan-sion project at its Oneida facility in Madison county, NY, partly as a result of a low-cost power alloca-tion from New York Gov. Andrew M. Cuomo’s ReCharge NY pro-gram.

ReCharge NY, which is admin-istered by the New York Power Authority (NYPA), provides qualifying businesses and non-profits with lower energy costs in exchange for commitments to retain or create jobs in New York.

HP Hood’s Oneida facility is receiving 280 kilowatts of expan-sion power from the discount power program. The power allocation is directly tied to the company’s completed expansion project and its commitment to retain approxi-mately 200 existing jobs and hire more than 25 new employees.

The expansion project included the installation of an additional milk production line, cold storage, food security and expanded facility capacity. HP Hood’s Oneida facil-ity produces approximately 113 milk and fluid products. It sup-plies major warehouse operations that provide foodservice, retail and wholesale firms with a full line of dairy products manufactured in Oneida and from other HP Hood manufacturing facilities.

“We are pleased with the results of the program and would like to extend our gratitude to Governor Cuomo and the New York Power Authority for providing significant support to this expansion project,”

commented Lynne Bohan, spokes-person for HP Hood. “Having been customers of the governor’s ReCharge NY program for several years, we’re aware of how impactful the program’s lower-cost power has been in sustaining our daily opera-tions and providing us with the ability to reinvest in our facility.”

HP Hood has been a NYPA ReCharge NY customer since 2012, when NYPA’s board of trustees awarded the Oneida loca-tion with 800 kilowatts of reten-tion power under the program. In addition to serving HP Hood in Oneida, NYPA also provides low-cost ReCharge NY power to HP Hood locations in Arkport, LaFar-geville, and Vernon.

As announced by Cuomo last July, HP Hood is currently reno-vating a facility in Batavia that will be operational in 2019, creat-ing 230 new jobs (for more details, please see HP Hood To Purchase Former Muller Quaker Dairy Plant In Batavia, NY..., on page 1 of our July 14, 2017 issue by scanning the QR Code on page 2 of this issue).

ReCharge NY offers up to seven-year power contracts. Half of the power is 455 megawatts from NYPA’s Niagara and St. Lawrence-Franklin D. Roosevelt hydroelectric power plants, while the remaining 455 megawatts is power purchased by NYPA on the wholesale market.

The ReCharge NY program is currently reducing electricity costs for more than 760 New York busi-nesses and not-for-profit organiza-tions.

“The state’s partnership with HP Hood to power their expanded milk processing plant with low-cost hydropower is a win-win for our community,” said State Rep. Bill Magee.

CHEESE REPORTERJune 29, 2018 Page 9

New Zealand’s Dairy Export Revenue Expected To Reach $16.6 Billion Due To Higher PricesWellington, New Zealand—New Zealand’s dairy export revenue is forecast to increase to $16.6 billion for the year ending June 2018, up $2.0 billion from the year ended June 2017, according to the Min-istry for Primary Industries’ Situa-tion and Outlook report for June 2018.

Global dairy prices have remained high throughout the year, particularly for butter and whole milk powder, which sup-ported strong export revenue despite an expected 1.0 percent production decline for the 2017/18 season, the report said.

Prices for both butter and whole milk powder rose quickly during the year ended June 2017, with export prices for New Zealand butter rising 57 percent over this time and WMP export prices rising 43 percent over the same period. These prices reached a peak in the December 2017 quarter but have maintained their overall strength throughout 2017/18.

Butter and whole milk powder make up around 55 percent of New Zealand’s dairy exports by volume, so strong prices for these products significantly affect the country’s total dairy export revenue, the report pointed out.

Whole milk powder prices have been supported by strong Chinese demand, as well as some buy-ers entering the market on short notice because they had been sit-ting back in expectation of fall-ing prices. Butter prices continue to ride the resurgent popularity of natural fats as consumer prefer-ences in Western markets swing in this direction.

An expected 53 percent increase in infant formula exports (to $1.2 billion) is also contributing to the strong increase in overall dairy export revenue this year. Export volumes rose significantly as more processing facilities came online during the year, while prices also increased.

New Zealand’s dairy export rev-enue is forecast to increase to $17.2 billion for the year ending June 2019. Butter prices are expected to rise even higher than cur-rent levels, infant formula export prices and volumes are forecast to rise, and skim milk powder prices should rebound somewhat during the season.

Overall, export volumes are expected to remain relatively sta-ble, with only a 0.5 percent increase in dairy production forecast for the 2018/19 season. This modest pro-duction increase is being driven by continued on-farm productiv-ity gains rather than increased cow numbers.

Butter exports are expected to continue to increase during the year ending June 2019 because

both prices and volumes are fore-cast to increase slightly. Despite major butter producers like the European Union (EU) increasing overall milk production, consumer demand continues to outstrip sup-ply of the product, supporting the current high prices.

One danger of high butter prices is that manufacturers may turn to using alternative fats in their pro-duction processes and may not return to butter if prices recede, the report noted.

Infant formula prices have remained high as Chinese demand continues to grow. For the nine months to March 2018, China imported almost twice as much infant formula from New Zealand

than during the comparable nine months ending March 2017. New Zealand is now the second largest infant formula exporter to China, although China’s imports from France and the Netherlands also increased significantly over this time.

Skim milk powder prices appear to have bottomed out in the March 2018 quarter and are expe-riencing a mild, temporary resur-gence because a slow start to the EU spring production season has dragged prices up somewhat. How-ever, these prices are expected to fall again in the first half of the June 2019 year as EU production catches up and SMP availability rises as a by-product of expected butter production increases.

New Zealand’s cheese export revenue is forecast to reach $1.92

billion for the year ending June 2018, up 4.9 percent from the pre-vious year. Japan, Australia and China were New Zealand’s leading cheese export markets, on a value basis, for the year ended March 2018.

New Zealand’s dairy export revenue is forecast to remain rela-tively stable through to the year ending June 2020. High butter prices are expected to begin fall-ing during this period, while whole milk powder prices are expected to fall slightly during the latter half of the year ending June 2019. This is forecast to partly offset an expected recovery in production for the 2019/20 season.

Cheese export revenue is fore-cast to increase to $1.95 billion in the year ending June 2019 and to $2.0 billion the following year.

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FDA Strategy(Continued from p. 1)

manufacturers to compete to offer these options.”

Assuring that consumers have nutrition information is a key ele-ment of the FDA’s public health mission, and that’s the purpose of the agency’s new, multi-year Nutrition Innovation Strategy, Gottlieb said. This effort involves a series of new actions intended to modernize FDA’s approach to nutrition, help reduce the burden of chronic disease that stems from poor nutrition, and to remove bar-riers to industry innovation.

FDA expects that the topics addressed at the July 26 meeting will include the following (a more detailed agenda will be made avail-able prior to the meeting): Modernizing federal standards

of identity to provide flexibility for the development of healthier prod-ucts, while making sure consumers have accurate information about these food products.

For example, the standards of identity for certain cheeses don’t always permit the use of salt sub-stitutes, “which could be used to lower the sodium content of cheese,” Gottlieb said. FDA has also been asked to modernize the standard of identity for yogurt to support the recent innovations.

“We also want to know if con-sumers are being misled in ways

that can adversely affect their dietary decisions when certain products qualify themselves with terms such as milk or rice, but are made from ingredients that don’t reflect the traditional assumptions about how products labeled that way are derived,” Gottlieb said.

In these cases, depending on what the agency learns, “we may step up our enforcement efforts against false or misleading label-ing,” Gottlieb said. “In addition, if we believe consumers are being misled by the use of these terms in a way that could adversely affect their diets, we might set out a pro-cess to develop new guidance that would identify terms that might confuse consumers about a prod-uct’s ingredients or nutrients.”

FDA continues to seek informa-tion on these issues, Gottlieb said. For example, “we need to more closely examine whether certain almond- or soy-derived products should be able to call themselves milk.” Considering using a standard

icon or symbol to denote the claim “healthy” on food labels. This is part of FDA’s ongoing work to update the definition of “healthy” on food labels, Gottlieb noted.

“People don’t eat nutrients. They eat foods. And foods need to be assembled into diets that give people proper nutrition,” he said. “That’s why having modern, science-based definitions around

terms like ‘healthy’, when used on food labels, and giving careful consideration to how foods carry-ing these labels can be part of good diets, can help consumers make more informed decisions about their meals.” Creating a more efficient

review strategy for evaluating qual-ified health claims on food labels. Discussing new or enhanced

labeling statements or claims that could facilitate innovation to pro-duce more healthful foods and more healthful consumer food choices. Providing opportunities to

make ingredient information more helpful to consumers. FDA’s educational campaign

for consumers about the updated Nutrition Facts label. The agency will be undertaking what Gottlieb called a “comprehensive educa-tional campaign” to help consum-ers use the new version of the Nutrition Facts label and interpret the overall nutritional content of products.

“We’re planning to create edu-cational videos, social media cam-paigns and user-friendly websites, and we’re soliciting feedback on effective ways to help consumers learn more about the relation-ship between their dietary choices and the impact it can have on their health and reducing the risk of chronic diseases,” Gottlieb explained.

“The FDA wants to empower consumers with modernized food labels that will make it easier to inform better choices while at the same time providing incen-tives for food manufacturers to produce the more nutritious prod-ucts consumers demand,” he said. “Toward these goals, our Innova-tion Strategy seeks ways to provide incentives for manufacturers and foster competition to create more nutritious food offerings and have clearer labeling that’s more under-standable to consumers.

Synergy Flavors Acquires Italian Flavor Supplier JanousekWauconda, IL—Synergy Flavors, Inc., a supplier of flavors, extracts and essences for the global food and beverage industries, recently announced its acquisition of Janousek, an expert in Italian fla-vor profiles.

Janousek, based in Trieste, Italy, has been serving customers in Italy and Eastern Europe for 135 years. The company provides flavorings for dairy and other food products, as well as natural colorings, addi-tives and adjuvants and other products.

“We’re thrilled to be welcom-ing the Janousek business into our group as it brings new expertise and products into our natural fla-vor, essences and extracts portfolio and complements our long heritage in dairy processing in Ireland and vanilla extraction in the USA, commented Steve Morgan, chief executive officer of Synergy Fla-vors EMEA.

“The Italian site has an excellent record for high quality manufac-turing and offers room for growth with easy access to much of main-land Europe,” Morgan continued. “Janousek is a growing, well-run business and we have no plans for major or immediate changes. Our intent is to invest in and grow the team, adding new skills and new capacity to the site as required over the coming years.”

Synergy’s flavor creation and application capabilities span the globe, with commercial, manu-facturing and technical support facilities in Ireland, the United Kingdom, the US, Brazil and Thai-land. The company is part of the Ireland-based Carbery Group, an international manufacturer of spe-cialty food ingredients, flavoring systems and cheese, owned by four Irish dairy cooperatives.

CHEESE REPORTERJune 29, 2018 Page 11

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Wisconsin Cheese Day Marked By Plant Visits, Grants To Great Lakes Cheese, CDRMadison—Wisconsin Gov. Scott Walker and several other state offi-cials celebrated the second annual Wisconsin Cheese Day on Mon-day by visiting 13 cheese compa-nies and facilities throughout the state.

The state partnered with the Wisconsin Cheese Makers Asso-ciation (WCMA) to celebrate the second annual Wisconsin Cheese Day. Other dairy and farm orga-nizations taking part in Wisconsin Cheese Day events included Dairy Farmers of Wisconsin, the Dairy Business Association and the Wis-consin Farm Bureau Federation.

Walker himself visited Great Lakes Cheese Co. in Wausau, where he announced that the company has received a $500,000 state grant that will assist the com-pany in training workers for its facility now under construction in Wausau.

Great Lakes Cheese is building a new $95 million state-of-the-art cheese packaging facility at the Wausau West Industrial Park. The 180,000-square-foot facility is expected to open in January 2019.

The company is receiving the $500,000 Workforce Training Grant from the Wisconsin Eco-nomic Development Corporation (WEDC) to train employess on the new equipment and processes at the new facility. Great Lakes Cheese is matching the state’s investment for training.

“As we continue to expand and modernize our operations in Wis-consin, it’s imperative that our workers have the skills and train-ing required to operate the modern state-of-the-art equipment we will utilize in the new Wausau plant,” said Matt Wilkinson, project man-agement director for Great Lakes Cheese. “Employee training is vital not just to the success of Great Lakes Cheese as a local employer, but for our ongoing commitment to producing delicious world-class cheese.

“We thank the state of Wiscon-sin for supporting our efforts to con-tinue to develop and enhance the skills of our workforce,” Wilkinson added.

Last year, WEDC awarded Great Lakes Cheese up to $2 mil-lion in state income tax credits for its expansion project, which at the time was a $55 million project expected to create 125 new jobs.

However, because of growing demand for its products, Great Lakes Cheese is increasing its production capability and capac-ity earlier than expected and now plans to create 200 jobs at the new plant over the next three years.

Great Lakes Cheese has four locations in Wisconsin with about 1,200 employees, including 230 at its existing facility in Wausau.

Those workers will move to the new plant when it opens.

Also on Monday, Walker vis-ited the Center for Dairy Research (CDR) at the University of Wisconsin-Madison to present a $200,000 state grant to expand an innovative program that promotes entrepreneurship in the state’s dairy industry.

The WEDC grant will enable CDR to continue to provide com-panies with grants of up to $20,000 to support the commercialization of unique dairy technologies and products.

Launched in 2013, the Tech Transfer, University, Research and Business Opportunity (TURBO) Program has helped 11 compa-nies purchase equipment needed for new products or processes. The TURBO program was launched to provide business assistance and technology transfer opportuni-ties to dairy manufacturers and was originally funded through an i6 Challenge grant from the US Department of Commerce.

The WEDC’s first $200,000 grant, awarded in 2012, has helped generate more than $2 million in private spending by the businesses receiving grants.

“For more than 30 years, CDR has been assisting the dairy indus-try with product development and technology transfer,” said Vic Grassman, TURBO program man-ager. “We have been particularly pleased to assist with and showcase the innovative pursuits of our rural Wisconsin communities.

“This program has allowed us to expand on that goal and the result-ing job retention, creation and capital investment has ultimately benefited not only the award-ees but their local communities,” Grassman added.

They were joined by leaders from the cheese and dairy industry, as well as local and regional eco-nomic development organizations, state lawmakers and the Univer-sity of Wisconsin.

In addition to Great Lakes Cheese and the CDR, the com-panies and cheese facilities that were part of the tour included Gehl Foods, Germantown; Nor-dic Creamery, Westby; UW-River Falls Dairy Pilot Plant, River Falls; Shullsburg Creamery, Shullsburg; Chalet Cheese Co-op, Monroe; Clock Shadow Creamery, Milwau-kee; Emmi Roth, Platteville; Eau Galle Cheese Factory, Durand; Ellsworth Cooperative Creamery, Ellsworth; Cheese Counter and Dairy Heritage Center, Plymouth; and Schreiber Foods, Green Bay.

“Wisconsin’s rich history of cheesemaking is also a key compo-nent to strengthening its economic future,” said John Umhoefer, the WCMA’s executive director. “As

Officials from the state of Wisconsin, along with leaders from the cheese and dairy industry, state lawmakers and others, visited 13 cheese companies and facilities around the state on Monday as part of the second annual Wisconsin Cheese Day. Among the facilities visited was Shullsburg Creamery in Shullsburg, WI. In the photo above are, left to right: Rebekah Swee-ney, Wisconsin Cheese Makers Association; Barb LaMue, Wisconsin Economic Development Corporation; State Rep. Todd Novak; Scott Stocker and Brian Jones, Shullsburg Creamery; and Norm Monsen, Wisconsin Department of Agriculture, Trade, and Consumer Protection.

new manufacturing and processing plants open and others increase their production, our industry is adding family-supporting jobs and boosting rural communities.”

“Through innovative research and new product development,

Wisconsin cheese makers continue to create high-quality, award-winning cheese for consumers worldwide,” said Sheila Harsdorf, secretary of the Wisconsin Depart-ment of Agriculture, Trade and Consumer Protection.

CHEESE REPORTERPage 12 June 29, 2018

www.cheesereporter.com/events.htmSUPPLIER NEWS

COMPANY NEWS

PEOPLE

We look at cheese differently.

...because we don’t just see cheese, we see the whole picture. 1.866.404.4545 www.devilletechnologies.com

Cheese Reporter Ad.indd 1 2018-01-03 11:52 PM

ADPI Dairy Ingredient Seminar Set For Sept. 24-26 In Santa Barbara, CASanta Barbara, CA—The Amer-ican Dairy Products Institute (ADPI) has announced dates and locations for its upcoming fall events, including the Dairy Ingre-dient Seminar here Sept. 24-26 at the Fess Parker Resort.

This three-day event kicks off Monday eve-ning with a welcome recep-tion. Tuesday begins with an outlook session on the global dairy environment featuring Phil Plourd, Blimling & Associates; Christophe Lafougere, GIRA; and Thomas Bauer, IFC Group/World Bank.

Invited speakers for the ingredi-ents outlook session include Steve Cooper of Select Milk Producers on milk powders; Dan LaMarche, Agropur, on lactose and permeate; Yann Connan of Lactalis on dry whey; Ulrik Bank Pederson of Arla Foods Ingredients on whey pro-teins; and Sarah Stanley, Friesland Campina, on microfiltered ingre-dients.

After lunch, the speaker lineup will focus on demand drivers and trade trends. Leprino Foods’ Sue Taylor will talk about trade policy, and ADPI strategic development consultant Veronique Lagrange will cover the recent plant protein surge. Jim Sullivan of JE Sullivan Enterprice will also provide an ani-

mal feed update.A Tuesday afternoon session

on the latest in scientific advances in the dairy industry will feature Moises Torres-Gonzalez with the National Dairy Council (NDC) on nutrition advances, followed by ADPI technical consultant

Phil Tong on technology and biotech.

Tuesday will wrap up with discussions on

what specific applications custom-ers want, and the latest technolo-gies in infant formula.

The seminar will finish Wednes-day morning with a risk manage-ment panel discussion led by Mike McCully of The McCully Group. Chip English of Davis Wright Tre-maine has been invited to speak on the latest regulatory trends, followed by California Dairies’ Andrei Mikhalevsky on global milkfat trends.

Sara Dorland of Ceres Dairy Management will wrap up the seminar with a talk entitled “Deep Dive on Price Discovery: Trans-port.”

The event will adjourn at noon.Cost to attend the seminar is $450 for ADPI members and $595 for non-members.

For full details and to register online, visit www.adpi.org/Events/DairyIngredientSeminar.

Penn State Cultured Dairy Products Short Course Is Sept. 18-20University Park, PA—Penn State University will host its Cultured Dairy Products Short Course here Sept. 18-20 at the Erickson Food Science Building on campus.

This three-day course begins with an overview of cultured prod-uct processing, dairy ingredients, and starter cultures. These princi-ples are applied in lectures on the manufacture of buttermilk, Cot-tage cheese, cream cheese, sour cream, yogurt, Greek-style yogurt, cultured milk drinks, and novel products.

Tuesday’s lectures and labs will cover the function of milk pro-teins in cultured dairy products, starter culture systems, and the use of stabilizers, along with an introduction to microbiology and

milk microbiology. Wednesday’s agenda will highlight the manu-facture of yogurt, buttermilk, sour cream, Cottage cheese and cream cheese.

The third day of the workshop will discuss probiotics, flavoring cultured dairy products, Greek-style yogurt products, and assessing rheological properties of cultured dairy products.

Lab sessions will be held from 12:45 p.m. until adjournment at 4 p.m.

The registration fee is $1,200 per person if paid by Aug. 23. For registrations received after the deadline, cost is $1,350 per person. Registration includes course mate-rials, three continental breakfasts, three lunches, welcome recep-tion, afternoon refreshments and a fleece vest.

To sign up online, visit www.cvent.com/events/cultured-dairy-products-short-course

DAIRY, THE GIFT OF NATUREJoin the buzz as industry leaders discuss the future market opportunities and challenges for dairy ingredients.

SEPTEMBER 24 - 26, 2018 SANTA BARBARA, CA

Complete seminar details and online registration at www.adpi.org

% info@adpi.org ! (630) 530-8700 T www.adpi.org

What is in the works?ADPI Dairy Ingredient Seminar brings together the

leadership of the U.S. dairy industry — producers,

processors, end users, suppliers, traders, brokers and

academics — to build relationships and discuss the current

landscape as it relates to the future of the dairy industry.

featured sessions: W Global Environment

W Ingredients Outlook

W Demand Drivers & Trade Trends

W What’s New With Science

W Applications: What The Customer Wants

W Impacting Factors

GREAT LOCATION

The Fess Parker Doubletree is a beautiful beach front resort

celebrates local history, authentic Santa Barbara style and stunning

sunsets allowing attendees to network in an environment

like no other

NETWORK & ENGAGE

Interact with colleagues in both formal and casual social settings. This event is the prime location to meet and connect with the

people you know and the ones you want to meet. you want to meet.

OUTSTANDING PROGRAM

This event provides informative sessions about what we can do now to help shape

the future that will de�ne our industry in the coming years.

ADPI_MembraneTechIssue.indd 1 5/24/2018 12:09:30 PM

Entry Deadline For WDE Championship Dairy Product Contest Is July 20Madison—Online entry is open for the 2018 World Dairy Expo Championship Dairy Product Contest, with forms and fees due Friday, July 20.

The contest is open to any cheese, butter, yogurt, ice cream, gelato, sour cream, whey, Cot-tage cheese, fluid milk, buttermilk, sherbet, dairy-based dips and cream manufacturing plant.

Judging for this year’s contest, hosted by the Wisconsin Dairy Products Association (WDPA), will take place here Aug. 21-23.

Judging day for cheese and but-ter entries will be Aug. 21. Yogurt, Cottage cheese, fluid milk, dairy-based dips, whipping cream and other Grade A products will be judged on the following day.

Ice cream, sherbet, gelato, whey products, nonfat dry milk and cre-ative/innovative technologies will be judged on Aug. 23.

A $55 entry fee is required for each product. All entries must be shipped to arrive between Aug. 13-17, and overnight shipping is recommended.

For international entries, com-panies should be aware of possible customs delays and ship accord-ingly.

All contest entries must be sub-mitted by a company or manufac-turer. Those with multiple plant locations can ship as many entries as they wish from each separate location. There are also no restric-tions on the number of entries a company may submit.

Specific Rules For Each Category This year’s cheese category fea-tures 29 separate classes. Each entry must be in its original form as hooped, and cheeses cannot be cut or sampled with a trier, minus a few exceptions – 40-pound blocks cut from 640-pound blocks will be allowed; Swiss cheese may have one trier hole; and cheeses cut dur-ing manufacturing such as Feta in brine will be allowed.

Each cheese entry must consist of at least 10 pounds of product, and each cream cheese entry must weigh at least one pound.

For fluid milk, this year’s contest features 10 classes. Each entry must consist of a minimum of two half-gallons, and only 2 percent milk is

allowed in the White Milk class. Any fat level is acceptable in the Cultured Milk class.

In the cream category, each entry must equal a minimum of two quarts with no aerosol con-tainers. Entries must also contain a minimum of 30 percent milkfat, and the category does not include pre-whipped cream.

The yogurt category has eight classes this year, and each entry must consist of at least 64 ounces of product. There are no restric-tions on the fat level for entries, and any type of sweetener source is allowed.

The dairy-based dips category will include five classes, and each sour cream or sour cream-based dip entry must consist of a minimum of two 16-ounce containers.

Each entry must be at least one gallon and comply with federal compositional standards.

The whey category will include six classes, and each entry must consist of a minimum of a half-pound container, except for whey-based sports/energy drinks that should be at least six 8-ounce con-tainers.

Each whey entry must be shipped accordingly. Only flavor and color will be judged, and all whey entries will be evaluated uti-lizing uniform concentration and source of water.

The nonfat dry milk category has one class and each entry must weigh at least a half-pound. Entries must be shipped in laminated paper/plastic bags or in screwcap plastic containers.

The submitted entry must con-tain a minimum of 25 percent dairy, and must consist of at least six 16-ounce containers or equiva-lent volume.

Winners in each class will be auctioned off on Tuesday, Oct. 2 at the World Dairy Expo Champion-ship Dairy Product Contest Auc-tion at the Alliant Energy Center in Madison.

To help ensure proper represen-tation of products, winning com-panies from certain classes will be asked to ship fresh items to win-ning bidders after the auction.

For full contest details or to enter online, visit www.wdpa.net.

CHEESE REPORTERJune 29, 2018 Page 13

MARKET PLACECLASSIFIED ADVERTISINGphone: (608) 246-8430 fax: (608) 246-8431e-mail: classifieds@cheesereporter.comSe

rvin

gth

eWorld's Dairy Industry W

eekly

Since 1876

Classified ads should be placed by Thursday for the Friday issue. Classi-fied ads charged $.75 per word. Clas-sified ads payable in advance. Display Classifieds charged per column inch. For information, call 608-246-8430.

1. Equipment for SaleFOR SALE: 1500 and 1250 cream tanks. Like New. (800) 558-0112. (262) 473-3530.

WESTFALIA SEPARATORS: New arrivals! Great condition. Model num-bers 120, 130, 170 and 200. All water savers. Call GREAT LAKES SEPA-RATORS at (920) 863-3306 or e-mail drlambert@dialez.net.

SEPARATOR NEEDS - Before you buy a separator, give Great Lakes a call. TOP QUALITY, reconditioned machines at the lowest prices. Call Dave Lam-bert, Great Lakes Separators at (920) 863-3306; drlambert@dialez.net for more information.

1. Equipment for Sale

ALFA-LAVAL SEPARATOR: Model MRPX 518 HGV hermetic separator. Can be set up for warm or cold. Call GREAT LAKES SEPARATORS at (920) 863-3306 or e-mail drlambert@dialez.net.

FOR SALE: Car load of 300-400-500 late model open top milk tanks. Like new. (262) 473-3530

2. Equipment Wanted

WANTED TO BUY: Westfalia or Alfa-Laval separators. Large or small. Old or new. Top dollar paid. Call Great Lakes Separators at (920) 863-3306 or email drlambert@dialez.net

4. Flooring

EPOXY OR FIBERGLASS floors, walls, tank-linings, and tile grouting. Installed by M&W Protective Coating Co. LLC. For more information, please call (715) 234-2251.

The “Industry’s” Market Place for Products, Services, Equipment and Supplies, Real Estate and Employee Recruitment

10. Cheese & Dairy Products

FOR SALE: Current raw milk Cheddar, 40-pound blocks. Brunkow Cheese, Darlington, WI. (608) 776-3716.

11. Cheese Conversion

SHRED/DICE CAPABILITIES AVAILABLE: We have space available on our shred/dice line. We do 5-pound 10-pound, and 15-pound sizes. We are a Wisconsin/USDA approved plant. We can convert your cheese products, or can convert from our cheese stocks. Please e-mail: jeff@cedarvalleycheese.com

11. Dairy Ingredients

MILK PROTEIN ISOLATE FOR SALE: 28 bags of milk protein isolate starter 85%. CoA indicates expiration date of 6/13/19. Great reduced price. For pick-up at our Minnesota plant. Contact Sue at sguggenberger@stickneydairy.com or call: 320-686-0240.

12. Consultants

15. Warehousing

5. Real Estate

DAIRY PLANTS FOR SALE: http://dairyassets.webs.com/acquisitions-mergers-other. Contact Jim at 608-835-7705; or by email at jimcisler7@gmail.com

6. Help Wanted

SEEKING EXPERIENCED CHEESE-MAKERS: Please send cover letter and resume to max@max-mccalman.com

7. Positions Wanted

8. Promotion & Placement

PROMOTE YOURSELF - By contact-ing Tom Sloan & Associates. Job enhancement thru results oriented professionals. We place cheese mak-ers, production, technical, maintenance, engineering and sales management people. Contact Dairy Specialist David Sloan, Tom Sloan or Terri Sherman. TOM SLOAN & ASSOCIATES, INC., PO Box 50, Watertown, WI 53094. Phone : (920) 261-8890 or FAX: (920) 261-6357; or by email: tsloan@tsloan.com.

PLANT MANAGERThe Plant Manager is responsible for all plant operations to efficiently pro-duce specified quality and quantity of products and meet all process and customer quality specifications.

Key Skills & Experience:nMinimum of 5 years’ experience in Food Manufacturing – dairy plant preferredn5 years of experience in managing plant operations in food manufacturing, including managing & supervising teamsn Significant knowledge of cheese manufacturing processes experience is highly desiredn Strong experience and knowledge base to identify and solve potential problem areas in operations, quality, financial, and regulatory compliance to minimize risk to the organizationn Proficiency in operational finances, capital expenditures, and industry standardsn Ability to interact with all levels of employees and managementn Ability to assess issues, make quick decisions, implement solutions and influence changen Strong project management skills to include capable presentation experiencen Working proficiency level of knowledge of food certification programsn Must have strong technical knowledge to understand and troubleshoot all process and equipment related issues

Plant Manager

Job Description

The Plant Manager is responsible for all plant operations to efficiently produce specified quality and quantity of products and meet all process and customer quality specifications.

Reports to: General Manager

Essential Responsibilities

Supervision & Performance Management – Develop departmental structure, assign responsibilities and schedule, delegate authority, hire, train and develop employees

Cheese Plant Operation – Planning and manufacture of cheese to meet or exceed established operational targets; milk storage and production scheduling – a collaborative effort with the Production Manager

Product Quality – Ensure manufactured products meet customer compositional and microbial standards, with in collaboration with the Quality Assurance Team to ensure process quality and cheese compositional targets are met; troubleshoot and resolve any quality (including customer quality) issues

Cleaning and Sanitation – Monitor performance and adhere to the cleaning and sanitation protocols; collaborate with QA to establish cleaning and sanitation protocols

Process Improvement – Improve product quality and yield performance through continual process improvement efforts

Purchasing – Manage purchasing and inventory of all cheese/plant supplies and material at the most favorable cost consistent with quality standards and production schedule needs

Safety – Ensure safety policies and procedures are strictly followed and enforced; work closely with Safety Coordinator to develop and modify safety procedures for production operation

Key Skills & Experience

Send interest to:Michelle ScottStickney Hill Dairy(320)686-0240 • MScott@stickneydairy.com

Undergrade Cheese Wanted

Looking to Purchase Undergrade Cheese for the use in Animal Feed. O�-Spec Trim Beginning & End Run Natural or Processed Bulk or Packaged • Will Pay Competitive Prices • Pick-up as Needed • Fully Compliant with all FSMA Rules & RegulationsPlease Contact: Jason Hrdlicka at jhrdlicka@intcos.com 636-717-2100 ext. 1239

Associated Milk Producers Inc. (AMPI), a leading Midwest dairy cooperative, is looking for a

Plant Operations Managerfor our Sanborn, Iowa location.

At AMPI, we make the dairy products that make the brand.

What we’re made of is as important as what we make. Commitment to quality, responsibility to others and determination to succeed – guide us in all we do.

AMPI is an EEO employer -Veterans/Disabled and other protected categories.

Interested in joining

our team?

WE are interested in YOU.

Learn more and apply online at www.ampi.com.

Questions? Call 712-729-3255

Associated Milk Producers Inc. (AMPI), a leading Midwest dairy cooperative, is looking for a

Plant Operations Managerfor our Rochester, Minnesota location

At AMPI, we make the dairy products that make the brand.

What we’re made of is as important as what we make. Commitment to quality, responsibility to others and determination to succeed – guide us in all we do.

AMPI is an EEO employer -Veterans/Disabled and other protected categories.

Interested in joining

our team?

WE are interested in YOU.

Learn more and apply online at www.ampi.com.

Questions? Call 712-729-3255

Interested in joiningour team?

WE are interested in YOU.

At AMPI, we make the dairy products that make the brand.

What we’re made of is as important as what we make. Commitment to quality, responsibility to others and determination to succeed –guide us in all we do.

AMPI is an EEO employer -Veterans/Disabled and other protected categories.

Learn more and apply online at www.ampi.com.

Questions? Call 712-729-3255

Associated Milk Producers Inc. (AMPI), a leading Midwest dairy cooperative, is looking for a

Plant Operations Managerfor our Sanborn, Iowa location.

At AMPI, we make the dairy products that make the brand.

What we’re made of is as important as what we make. Commitment to quality, responsibility to others and determination to succeed – guide us in all we do.

AMPI is an EEO employer -Veterans/Disabled and other protected categories.

Interested in joining

our team?

WE are interested in YOU.

Learn more and apply online at www.ampi.com.

Questions? Call 712-729-3255

Associated Milk Producers Inc. (AMPI), a leading Midwest dairy cooperative, is looking for a

Plant Operations Managerfor our Rochester, Minnesota location

At AMPI, we make the dairy products that make the brand.

What we’re made of is as important as what we make. Commitment to quality, responsibility to others and determination to succeed – guide us in all we do.

AMPI is an EEO employer -Veterans/Disabled and other protected categories.

Interested in joining

our team?

WE are interested in YOU.

Learn more and apply online at www.ampi.com.

Questions? Call 712-729-3255

Interested in joiningour team?

WE are interested in YOU.

At AMPI, we make the dairy products that make the brand.

What we’re made of is as important as what we make. Commitment to quality, responsibility to others and determination to succeed –guide us in all we do.

AMPI is an EEO employer -Veterans/Disabled and other protected categories.

Learn more and apply online at www.ampi.com.

Questions? Call 712-729-3255

CHEESE REPORTERPage 14 June 29, 2018

Circle, copy and FAX to (608) 246-8431 for prompt response

CHEESE REPORTER READER RESPONSE CARD(Print Your Name and Address Clearly Below)

Name _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _

Title _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _

Company _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _

Address _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _

City/St/Zip _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _

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TYPE OF BUSINESS:___Cheese Manufacturer___Cheese Processor___Cheese Packager___Cheese Marketer(broker, distributor, retailer___Other dairy processor (butter, cultured products)___Whey processor___Food processing/Foodservice___Supplier to dairy processor___Other________________

JOB FUNCTION:___Company Management___Plant Management___Plant Personnel___Laboratory (QC, R&D, Tech)___Packaging___Purchasing___Warehouse/Distribution___Sales/Marketing___Other_______________

For information about the adver-tisements or new product infor-mation, circle the number below which corresponds to the ad or article in which you are interested.

Issue Date: 6/29/18

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PLEASE SEND ME MORE INFORMATION ON:___Subscribing to Cheese Reporter___Cheese Reporter’s Reference Books

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$1.35

$1.45

$1.55

$1.65

$1.75

$1.85

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

40-Pound Block Avg

CME vs AMS

WEEK ENDINGStyle and Region June 23 June 16 June 9 June 2

40-Pound Block Cheddar Cheese Prices and Sales Weighted Price Dollars/PoundUS 1.6383 1.6456• 1.6526 1.6661Sales Volume PoundsUS 11,458,414 11,631,954• 11,894,825 12,173,274

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

Weighted Price Dollars/Pound US 1.6439 1.6573 1.6830 1.6971 Adjusted to 38% Moisture US 1.5612 1.5747 1.5977 1.6136 Sales Volume PoundsUS 12,524,345 12,743,932 12,142,222 11,659,617Weighted Moisture Content PercentUS 34.72 34.75 34.69 34.79

Butter

Weighted Price Dollars/PoundUS 2.3771 2.3617• 2.3769• 2.4039Sales Volume PoundsUS 2,704,869 5,321,643• 6,651,467• 5,427,445

Dry Whey Prices

Weighted Price Dollars/PoundsUS 0.3222 0.3097• 0.2979 0.2849Sales Volume US 5,747,366 6,763,009• 6,152,724 4,735,198

Nonfat Dry Milk

Average Price Dollars/PoundUS 0.7999 0.8217• 0.8286• 0.8361Sales Volume PoundsUS 15,558,970 11,657,416• 13,715,416• 14,653,871

June 27, 2018—AMS’ National Dairy Prod-ucts Sales Report. Prices included are pro-vided each week by manufacturers. Prices collected are for the (wholesale) point of sale for natural, unaged Cheddar; boxes of butter meeting USDA standards; Extra Grade edible dry whey; and Extra Grade and USPH Grade A nonfortified NFDM. •Revised

DAIRY PRODUCT SALESDairy Product Stocks in Cold StorageTOTAL STOCKS AS REPORTED BY USDA (in thousands of pounds unless indicated) Public Stocks in All May 31, 2018 Warehouse Warehouses as a % of Stocks May 31 April 30 May 31 May 31 April 30 May 31 2017 2018 2018 2017 2018 2018

Butter 313,593 307,325 338,807 108 110 316,825

Cheese American 816,266 780,270 804,744 99 103 Swiss 26,242 29,193 31,402 120 108 Other 466,421 535,836 549,693 118 103

Total 1,308,929 1,345,289 1,385,839 106 103 988,808

625

650

675

700

725

750

775

800

825

850

2012 13 2014 15 2016 17 2018

American-Type Cheese StocksMay 31 of Select Years; million lbs

175

200

225

250

275

300

325

350

2012 2013 2014 2015 2016 2017 2018

Butter StocksMay 31 of Select Years, million lbs

$1.00

$1.25

$1.50

$1.75

$2.00

$2.25

2001 2005 2009 2013 2018

Average June CME Barrel Cheese PricesBarrels Since 2001

$1.35

$1.45

$1.55

$1.65

$1.75

$1.85

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

40-Pound Block Avg

CME vs AMS

DAIRY FUTURES PRICESSETTLING PRICE *Cash SettledDate Month Class III* Class IV* Dry Whey* NDM* Butter* Cheese*6-22 June 18 15.25 14.96 30.800 82.000 237.250 1.61906-25 June 18 15.21 14.94 30.525 81.525 235.800 1.61706-26 June 18 15.22 14.91 30.525 81.525 236.000 1.61806-27 June 18 15.23 14.91 30.625 81.750 236.475 1.61906-28 June 18 15.24 14.91 30.750 81.550 236.625 1.61906-22 July 18 14.66 14.50 32.650 80.000 231.650 1.54906-25 July 18 14.10 14.25 32.000 79.250 228.000 1.49806-26 July 18 14.06 14.23 31.825 79.000 227.375 1.49606-27 July 18 14.29 14.35 32.500 79.250 227.600 1.51506-28 July 18 14.34 14.35 32.775 78.700 228.750 1.51506-22 August 18 15.36 14.60 32.000 79.950 232.000 1.62706-25 August 18 14.86 14.36 31.125 78.050 228.400 1.58306-26 August 18 14.88 14.59 31.250 79.750 227.750 1.58306-27 August 18 15.27 14.37 33.000 82.150 229.500 1.61106-28 August 18 15.21 14.37 32.750 79.000 230.625 1.60406-22 September 18 15.93 14.81 31.350 81.375 233.650 1.68206-25 September 18 15.54 14.59 30.750 79.575 231.000 1.65306-26 September 18 15.57 14.59 30.775 80.250 230.475 1.65306-27 September 18 15.89 14.59 31.950 81.200 231.500 1.67506-28 September 18 16.07 14.55 332.475 80.225 231.750 1.67906-22 October 18 16.02 15.07 31.675 82.975 236.775 1.69506-25 October 18 15.75 14.90 30.500 81.525 234.200 1.67606-26 October 18 15.77 14.89 30.550 82.150 233.450 1.67606-27 October 18 16.03 14.89 30.825 82.500 234.475 1.69406-28 October 18 15.99 14.83 31.150 82.000 234.700 1.7000

6-22 November 18 15.92 15.18 30.975 84.275 236.800 1.69106-25 November 18 15.69 14.99 30.250 82.900 235.125 1.67506-26 November 18 15.73 15.00 30.125 83.300 234.825 1.67106-27 November 18 15.96 15.01 30.325 84.050 235.500 1.69006-28 November 18 15.93 15.03 31.025 83.250 235.650 1.69406-22 December 18 15.83 15.27 30.250 85.750 235.000 1.68206-25 December 18 15.66 15.09 29.750 84.250 234.200 1.67506-26 December 18 15.70 15.08 29.750 84.875 233.400 1.66806-27 December 18 15.88 15.08 31.000 84.800 234.275 1.68106-28 December 18 15.80 15.07 31.050 84.000 233.850 1.6850

6-22 January 19 15.73 15.11 30.025 86.575 230.875 1.67706-25 January 19 15.69 15.10 30.000 85.900 230.875 1.67206-25 January 19 15.63 15.09 30.000 85.750 230.875 1.66906-26 January 19 15.79 15.09 30.000 85.750 230.875 1.67206-28 January 19 15.80 15.09 30.150 85.400 230.875 1.68106-22 February 19 15.73 15.19 30.000 87.500 231.200 1.67806-25 February 19 15.68 15.19 30.000 86.900 231.200 1.67506-26 February 19 15.65 15.19 30.000 87.000 231.200 1.67706-27 February 19 15.79 15.19 30.000 87.000 231.200 1.67906-28 February 19 15.77 15.19 30.025 86.650 231.200 1.6750

6-22 March 19 15.74 15.54 30.000 88.700 235.500 1.68006-25 March 19 15.68 15.45 30.000 88.000 235.500 1.67506-26 March 19 15.66 15.45 30.000 88.375 235.500 1.67706-27 March 19 15.74 15.45 30.000 88.375 235.500 1.68206-28 March 19 15.90 15.44 30.025 87.900 235.500 1.67106-22 April 19 15.82 15.63 31.000 89.900 236.650 1.69006-25 April 19 15.77 15.60 31.000 89.250 236.650 1.68306-25 April 19 15.77 15.60 31.000 89.300 236.650 1.68406-27 April 19 15.85 15.60 31.000 89.400 236.650 1.69306-28 April 19 15.90 15.59 31.000 89.150 236.650 1.6820

Interest - June 28 23,837 1,558 4,076 6,572 7,634 26,128

CHEESE REPORTERJune 29, 2018 Page 15

DAIRY PRODUCT MARKETSAS REPORTED BY THE US DEPARTMENT OF AGRICULTURE

WHOLESALE CHEESE MARKETS

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

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

06/25/18 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50616 79,80806/01/18 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48,263 85,506Change . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,353 -5,698

NATIONAL - JUNE 22: The gap widened between cheese blocks and barrels on the CME, causing concerns among contacts amidst international trade disputes . Some market observers suggest that the downshift in production to prevent surplus, in addition to slow demand and plenty of barrels on the CME, created the wide price gap . Cheese production around the nation is mixed, varying from plant to plant . Cheese producers are more apprehen-sive on taking any extra milk . Spot milk loads remain abundant, and spot prices ranges from $3 to $4 under Class . Cheese demand domestically is mixed, and buyers are in no hurry to fill inventories due to many cheese offers . Cheese inventories are mixed by variety, with Italian cheeses and barrels being the longest . The cheese market tone is uncertain .

NORTHEAST- JUNE 27: Milk production in the Northeast is mixed . A few areas are seeing milk volumes a bit lower coming off the farms as warmer temperatures entered the region . In general, milk is still heavy and many cheese plants are taking in near to capacity milk loads . Cheese production is fairly strong . Cheddar, Provolone and Mozzarella cheese production schedules are full as milk is available for processing needs . The demand for Ched-dar and Italian cheeses is currently sluggish . Current cheese market conditions have many market participants concerned about where cheese prices and demand will go . Spot market prices for cheddar barrel and blocks are currently decreasing .

Wholesale prices, delivered, dollars per/lb:Cheddar 40-lb blocks: $1.9850 - $2.2700 Muenster: $1.9700 - $2.3200Process American 5#: $1.4575 - $1.9375 Swiss Cuts 10-14 lbs: $3.0275 - $3.3500

MIDWEST AREA - JUNE 27: On Tuesday, CME cheese barrel prices hit their lowest point since July 30, 2009 . The overall cheese market tone is undoubtedly shaken by a laun-dry list of bears: trade concerns, cold storage data and recently inconsistent barrel demand to name a few . Some Midwestern process cheese makers have shifted production into other varieties in an attempt to limit supplies and focus on better selling/seasonal items . Mozza-rella and Provolone makers are anxious regarding the markets, but say demand is meet-ing seasonal expectations nonetheless . Milk into cheese production remains discounted, between $3 to $4 under Class . Cheese plant managers expect discounts to remain into next week, ahead of Independence Day . However, as temperatures rise throughout the country, some are expecting volumes to wane following the holiday week .

Wholesale prices delivered, dollars per/lb: Blue 5# Loaf: $2.1600 - $3.1475Cheddar 40# Block: $1.6200 - $2.0150 Monterey Jack 10#: $1.8675 - $2.0725Mozzarella 5-6# (LMPS): $1.6925 - $2.6325 Muenster 5# Loaf: $1.8925 - $2.3175Process American 5#: $1.4125 - $1.7725 Grade A Swiss 6-9#: $2.5450 - $2.6625

WEST - JUNE 27: In the West, international cheese demand has started to decrease . With current trade issues, market participants report that some overseas customers are cancelling their contractual orders . Some US cheese sellers say that they are adjusting their prices downward to maintain current contracts . On the CME, barrel cheese sale activities increased since last week while block cheese trades remained sluggish . Stocks, particularly for barrel cheese are plentiful . As the result, several cheese processors are shifting their output from barrels to blocks as a way to prevent barrel inventories from increasing too much . Others are cutting down their overall production levels without switching products . The spread between the prices of blocks and barrels on the CME has widened above 20 cents .

Wholesale prices delivered, dollars per/lb: Cheddar 10# Cuts: $1.8325 - $2.0525Cheddar 40# Block: $1.6525 - $2.0975 Monterey Jack 10#: $1.8425 - $2.0025Process American 5#: $1.4000 - $1.6575 Grade A Swiss 6-9#: $2.6250 - $3.0550

FOREIGN -TYPE CHEESE - JUNE 27: Cheese export sales from Germany to Southern Europe are lively . Mozzarella is in great demand . Cheese stocks remained at lower levels . In Germany, production is ongoing . However, due to a decline in milk components and milk volumes delivered, the likelihood for an expansion of current production to meet increasing demand is limited . Prices for sliced cheese continue to be firm . For July contracts negotiations, cheese sellers are demanding and enforcing higher prices .

Selling prices, delivered, dollars per/lb: Imported DomesticBlue: $2.6400 - 5.2300 $2.3275 - 3.5250Gorgonzola: $3.6900 - 5.7400 $2.5450 - 3.2625Parmesan (Italy): 0 $3.4275 - 5.5175Romano (Cows Milk): 0 $3.2275 - 5.3775Sardo Romano (Argentine): $2.8500 - 4.7800 0Reggianito (Argentine): $3.2900 - 4.7800 0Jarlsberg (Brand): $2.9500 - 6.4500 0Swiss Cuts Switzerland: 0 $3.0650 - 3.3875Swiss Cuts Finnish: $2.6700- 2.9300 0

NATIONAL - JUNE 22: In general, albeit some Class II processors, especially ice cream makers, continue pulling strong on butterfat supplies, cream volumes are readily available for butter churning across the nation . In fact, some butter makers are contemplating slowing down the churns and selling off some cream on the spot market . Therefore, butter churning remains active, while inventories vary in each region of the country . The butter market undertone looks to be steady this week . Requests from retail-ers and foodservice are fair/good . Across the country, bulk butter pricing is ranging from 1 .5 below to 8 cents above the market, based on the CME Group with various peri-ods and averages used .

NORTHEAST - JUNE 27: Demand for cream is strong and sharply reduces churn-ing schedules at a few plants, as the East region butter production rate ranges mod-erate to light . Buying interest is seasonally steady . With current schedules and inven-tories on hand, butter stocks are sufficient for existing and near-term demand . Overall, inventories are building . The bulk price for domestic sales is 5-8 cents over the mar-ket of the CME Group, with various time frames and averages used . On Tuesday, at the CME Group, butter closed at $2 .2450 as prices moved $0 .0650 under the previous Tuesday’s close . The butter market under-tone is unsettled as prices weaken .

CENTRAL - JUNE 27: Centrally located butter producers, like a number of processors in the dairy industry, are con-cerned about recent market trends . That said, there is still confidence in the founda-tion of the butter market, and some ana-lysts maintain that butter may be near or at its basement . Some contacts point out a steady to slowing demand . Cream remains available even during the ice cream manu-facturing peak . Class IV cream prices have picked up slightly at the top end, while region specific readily available cream loads are keeping the low end prices anchored . The national average advertised price for a 1-pound package of butter is $3 .79 .

WEST - JUNE 27: Western contacts say butter demand has softened as the sum-mer heat is on the rise . Cream is readily available . However, with higher multiples, some manufacturers are willing to sell off the milkfat to ice cream manufacturers in lieu of making butter . By slowing the churns, butter processors hope to stem the growth of inventories . Butter stocks have grown con-siderably, as indicated by the recent Cold Storage report . Ample amounts of inexpen-sive cream through the spring and early part of summer and the usual desire to replenish supplies prior to fall baking led to strong production . Manufacturers are now working to find a good balance between production and the current and future butter needs .

NONFAT DRY MILK - JUNE 28NDM - CENTRAL: Central region low/medium heat NDM prices decreased on both the range and mostly price series . Spot market activity picked up following what has generally been a slow trad-ing month . Buyers, however, are aware of numerous market bears, particularly where spot prices have shifted on the CME Group . A growing number of Cen-tral region spot transactions have found a comfort zone in the high $ .70s to $ .80 . Undoubtedly, regional production contin-ues heartily as condensed skim remains readily available . A number of contacts are hopeful that forecasted heatwaves will slow milk production in coming weeks .

NDM - EAST: NDM production in most facilities is steady, but reports indicate milk receipts at some powder plants margin-ally declined . Producers’ low/medium heat NDM stocks are building while the mar-ket sees no reason to buy too far ahead, as downward pressure gains momentum . Resale markets are seeing an uptick in activity as sellers hope to clear older

inventory . Demand for high heat NDM is strong from bakery operations, but aside from contracted volumes high heat is not easy to come by .

NDM - WEST: This week, western low/medium heat NDM prices adjusted steady to lower . Meanwhile, future NDM contract values look to be relatively stable along Q3 and Q4 . It is important to note that starting next week, July 6, 2018, China announced it will increase its import tariffs for some dairy products from the US, including SMP among others . Therefore, several SMP manufacturers are losing orders from that country . Consequently, there is a lot of uncertainty in the domestic NDM market . This week, NDM sales have been slow as many local NDM buyers/end users are skeptical to extend coverage further than needed . Meanwhile, low/medium heat pro-duction is active while inventories are still at elevated levels . High heat nonfat dry milk prices adjusted steady to lower, shad-owing low/medium heat NDM cash values for this week .

WHOLESALE BUTTER MARKETS

ORGANIC DAIRY - RETAIL OVERVIEW National Weighted Retail Avg Price: Butter 1 lb: $5.42Cheese Shred 8 oz: $3.49Yogurt 4-6 oz: $0.88Yogurt 32 oz: $3.09Sour Cream 16 oz: $2.50

Greek Yogurt 4-6 oz: $1.00Greek Yogurt 32 oz: $5.21Milk ½ gallon: $4.19Milk gallon: $6.99Milk UHT 8 oz: NAIce Cream 48-64 oz: $5.99

RETAIL PRICES - CONVENTIONAL DAIRY - JUNE 29Commodity

Butter 1#

Cheese 8 oz block

Cheese 1# block

Cheese 2# block

Cheese 8 oz shred

Cheese 1# shred

Cottage Cheese

Cream Cheese

Flavored Milk ½ gallon

Flavored Milk gallon

Ice Cream 48-64 oz

Milk ½ gallon

Milk gallon

Sour Cream 16 oz

Yogurt (Greek) 4-6 oz

Yogurt (Greek) 32 oz

Yogurt 4-6 oz

Yogurt 32 oz

US NE SE MID SC SW NW

3 .45 2 .92 3 .50 2 .85 3 .30 3 .87 3 .68

2 .08 2 .25 2 .11 1.89 2.17 1 .41 2 .00

3 .97 4 .15 3 .30 3 .50 3 .35 4 .69 NA

6 .46 NA NA NA NA 6 .45 5 .59

2 .12 2 .19 2 .12 1 .98 2 .31 2 .03 1 .99

3.95 4 .92 3 .48 3 .50 3 .49 NA NA

1 .86 2 .34 1 .95 1 .48 1 .74 1 .56 NA

1 .85 1 .94 2 .01 1 .31 1 .66 1 .63 2 .03

1.81 NA NA 2 .00 NA NA 1 .49

3 .53 NA 3 .99 2 .96 NA NA NA

3 .02 2 .67 2 .88 3 .17 3 .26 3 .06 2 .56

2 .86 5 .49 2 .50 NA 1 .89 2 .50 1 .49

3 .31 NA 3 .99 2 .16 2 .56 2 .50 1 .99

1 .82 1.88 1 .94 1.63 1 .85 1 .70 1 .38

.95 .99 1 .02 .91 .94 .88 .93

4.48 4 .85 4 .12 4 .99 N4 .66 NA NA

.53 .54 .50 .50 .45 .57 .52

2 .01 2 .69 NA NA 2 .50 1 .67 NA

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

NATIONAL - CONVENTIONAL DAIRY PRODUCTSThe total number of conventional dairy ads increased 8 percent from last week . Organic dairy ads increased 47 percent . Cream cheese posted the largest increase, in the conven-tional category, for an advertised dairy item as ad numbers increased 146 percent . The US average conventional one-pound butter price is $3 .45, 34 cents less than a week ago . The number of butter ads were 6 percent above a week ago . No organic butter ads were noted this week . The conventional cheese ad number increased 3 percent . There were no ads for organic cheese . The weighted average price of conventional 8-ounce block cheese is $2 .08, down 15 cents from last week . The average price of conventional 8-ounce shred cheese is $2 .12, down 20 cents from last week . The national average advertised conventional milk price for half-gallons is $2 .86, while organic half-gallon milk averaged $4 .19 . The organic price premium is $1 .33, a $0 .35 dip from last week . Conventional milk ad numbers decreased 34 percent while organic milk ad numbers decreased 5 percent . Ad volumes for conventional milk and organic milk were fairly even this week .

CHEESE REPORTERPage 16 June 29, 2018

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec‘10 1.4536 1.4526 1.2976 1.4182 1.4420 1.3961 1.5549 1.6367 1.7374 1.7246 1.4619 1.3807‘11 1.5140 1.9064 1.8125 1.6036 1.6858 2.0995 2.1150 1.9725 1.7561 1.7231 1.8716 1.6170‘12 1.5546 1.4793 1.5193 1.5039 1.5234 1.6313 1.6855 1.8262 1.9245 2.0757 1.9073 1.6619‘13 1.6965 1.6420 1.6240 1.8225 1.8052 1.7140 1.7074 1.7492 1.7956 1.8236 1.8478 1.9431‘14 2.2227 2.1945 2.3554 2.2439 2.0155 2.0237 1.9870 2.1820 2.3499 2.1932 1.9513 1.5938‘15 1.5218 1.5382 1.5549 1.5890 1.6308 1.7052 1.6659 1.7111 1.6605 1.6674 1.6175 1.4616‘16 1.4757 1.4744 1.4877 1.4194 1.3174 1.5005 1.6613 1.7826 1.6224 1.6305 1.8775 1.7335‘17 1.6866 1.6199 1.4342 1.4976 1.6264 1.6022 1.6586 1.6852 1.6370 1.7305 1.6590 1.4900‘18 1.4938 1.5157 1.5614 1.6062 1.6397 1.5617

HISTORICAL MONTHLY AVERAGE BLOCK PRICES

CME CASH PRICES - JUNE 25 - 29, 2018Visit www.cheesereporter.com for daily prices

500-LB 40-LB AA GRADE A DRY CHEDDAR CHEDDAR BUTTER NFDM WHEY

MONDAY $1.2050 $1.4500 $2.2550 $0.7375 $0.4000 June 25 (-8) (-4) (-2½) (-2½) (+¼)

TUESDAY $1.2050 $1.4600 $2.2450 $0.7475 $0.3900June 26 (NC) (+1) (-1) (+1) (-1)

WEDNESDAY $1.2550 $1.4850 $2.2525 $0.7525 $0.4025June 27 (+5) (+2½) (+¾) (+½) (+1¼)

THURSDAY $1.3350 $1.5125 $2.2500 $0.7475 $0.4125June 28 (+8) (+2¾) (-¼) (-½) (+1)

FRIDAY $1.3900 $1.5550 $2.2675 $0.7475 $0.4075June 29 (+5½) (+4¼) (+1¾) (NC) (-½)

Week’s AVG $1.2780 $1.4925 $2.2540 $0.7465 $0.4025Change (-0.0435) (-0.0380) (-0.0460) (-0.0160) (+0.0080)

Last Week’s $1.3215 $1.5305 $2.3000 $0.7625 $0.3945AVG

2017 AVG $1.3615 $1.5190 $2.6340 $0.8445 NASame Week

MARKET OPINION - CHEESE REPORTERCheese Comment: Two cars of blocks were sold Monday, both at $1.4500, which lowered the price. On Tuesday, 1 car of blocks was sold on an offer at $1.4600, which raised the price. No blocks were sold Wednesday; the price increased on an unfilled bid for 1 car at $1.4850. No blocks were sold Thursday, either; the price rose on an unfilled bid for 1 car at $1.5125. Two cars of blocks were sold Friday, both on offers, the last at $1.5550, which raised the price. The barrel price dropped Monday on a bid-based sale of 1 car at $1.2050, increased Wednesday on a bid-based sale of 1 car at $1.2550, jumped Thursday on sales of 3 cars at $1.3350, and jumped Friday on unfilled bids for 11 cars at $1.3900. A total of 80 truckloads of barrels were sold this week at the CME.

Butter Comment: The price fell Monday on an uncovered offer of 1 car at $2.2550, declined Tuesday on offer-based sales of 2 cars at $2.2450, increased Wednesday on an offer-based sale of 1 car at $2.2525, fell Thursday on an uncovered offer of 1 car at $2.2500, then rose Friday on bid-based sales of 3 cars at $2.2675.

NDM Comment: The NDM price declined Monday on offer-based sales of 2 cars at 73.75 cents, rose Tuesday on an offer-based sale of 1 car at 74.75 cents, increased Wednesday on an offer-based sale of 1 car at 75.25 cents, then declined Thursday on offer-based sales of 2 cars at 74.75 cents.

WHEY MARKETS - JUNE 25 - 29, 2018RELEASE DATE - JUNE 27, 2018

Animal Feed Whey—Central: Milk Replacer: .2000 (NC) – .2400 (-4)

Buttermilk Powder: Central & East: .7350 (NC) – .8000 (NC) West: .7000 (NC) – .8200 (NC) Mostly: .7300 (NC) – .7800 (NC)

Casein: Rennet: 2.19000 (NC) – 2.5500 (NC) Acid: $2.9000 (NC) - $3.2000 (NC)

Dry Whey—Central (Edible): Nonhygroscopic: .2500 (+2½) – .4200 (+2) Mostly: .2850 (NC) – .3600 (NC) Dry Whey–West (Edible): Nonhygroscopic: .2975 (NC) – .4200 (+2) Mostly: .3000 (NC) – .3500 (NC)

Dry Whey—NE: .3000 (+2) — .4050 (+1½)

Lactose—Central and West: Edible: .1800 (NC) –.3900 (NC) Mostly: .2600 (+2) –.3300 (+1)

Nonfat Dry Milk —Central & East: Low/Medium Heat: .7525 (-¾) – .8500 (-1) Mostly: .7800 (-3) –.8250 (-2½) High Heat: .9350 (NC) – 1.0800 (NC)

Nonfat Dry Milk —Western: Low/Medium Heat: .7150 (NC) – .8450 (-1½) Mostly: .7500 (NC) –.8250 (-2) High Heat: .9300 (NC) – $1.0325 (-1¾)

California Weighted Average NFDM: Price Total Sales June 22 $0.7766 7,069,496 June 15 $0.7790 7,296,259 Whey Protein Concentrate—Central and West: Edible 34% Protein: .7200 (NC) – .9600 (NC) Mostly: .7400 (NC) – .8725 (+2¾)

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Restaurant Performance Index Fell Slightly In May As Expectations Index DeclinedWashington—The National Res-taurant Association’s Restaurant Performance Index (RPI) stood at 101.2 in May, down from April’s level of 101.3, the association reported today.

The RPI is constructed so that the health of the restaurant indus-try is measured in relation to a neutral level of 100. Index values above 100 indicate that key indus-try indicators are in a period of expansion, while values below 100 represent a period of contraction for key industry indicators.

The RPI consists of two compo-nents: the Current Situation Index and the Expectations Index. The Current Situation Index, which measures current trends in four industry indicators (same-store sales, traffic, labor and capital expenditures), stood at 100.6 in May, up from 100.5 in May.

Restaurant operators continued to report generally positive same-store sales results in May. Some 40 percent of operators reported a same-store sales increase between May 2017 and May 2018, while 30 percent reported a sales decline.

May represented the seventh consecutive month in which oper-ators reported a net increase in same-store sales.

By contrast, restaurant opera-tors in May reported a net decline in customer traffic for the second straight month. Some 29 percent of operators reported an increase in customer traffic between May 2017 and May 2018, while 47 percent reported lower customer traffic.

The Expectations Index, which measures restaurant operators’ six-month outlook for four indus-try indicators (same-store sales, employees, capital expenditures and business conditions), stood at 101.7 in May, down 0.4 percent from April.

Restaurant operators are some-what less optimistic about sales growth in the coming months. Some 39 percent of operators expected to have higher sales in six months (compared to the same period in the previous year), down from 47 percent in April.

Ten percent of restaurant opera-tors expect their sales volume in six months to be lower than it was during the same period in the pre-vious year.

Also, restaurant operators have mixed opinions about the direction of the overall economy. Twenty-two percent of operators said they expect economic conditions will improve in six months, down from more than four in 10 who reported similarly at the beginning of 2018.

And 17 percent of operators think economic conditions will worsen in six months — the high-est level since August 2017.