KENTUCKY
KDDC Annual Report w w w. k y d a i r y. o r g
Milk Matters Annual Report Featuring KDDC Sponsors See inside
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Don’t Forget the Young Dairy Producer Conference & KY Dairy Partners Annual Meeting View the agenda on page 3
2013 KDDC Year in Review Kentucky’s dairy industry is constantly transitioning and 2013 ushered in changes in several areas. Continental Milk Producers, Inc. began marketing KY producer milk and U.C. Milk Co., Madisonville, closed its doors after 86 years of business. Saputo, Inc. a Montreal based dairy processor began procuring milk after having purchased the Morningstar-Murray milk processing plant in late 2012. The London plant, owned and operated by Grupo LALA, a Mexican based dairy company, began procuring independent milk in KY during 2013. The Kentucky Department of Agriculture rolled out a new brand, “Udderly Kentucky Milk”. Processed and bottled at the Prairie Farms, Inc. plant in Somerset and offered for retail at Walmart stores across the state. This KY only produced product guarantees a return of $0.07/gallon or $0.84/cwt. to producers whose milk is processed at the plant. Other marketing happenings saw Chaney’s Dairy milk being bottled and offered in Bowling Green Kroger stores along with 11 Houchens stores in the area. The Southeast Milk Antitrust Lawsuit parties came to a settlement with the biggest payout to dairy farmers in Federal Milk Marketing Orders 5 and 7 in dairy’s history. Although payments will continue for three more years, the Class Action suit was finalized in 2013. Mailbox milk prices have been very good over the course of 2013 averaging nearly $21.00/cwt in Marketing Orders 5 and 7. However, even with nearly record milk prices, feed costs have eaten into profit margins. As corn prices declined some in the waning months of 2013, protein prices held firm not providing much relief to dairy farmers. Even so, the first months of 2014 are shaping up for producers to capture some much needed relief. Record cull cow prices and milk exports are helping keep domestic supply in line with demand. The KDDC staff has been working hard on many fronts throughout the year to keep KY dairy farmers informed and up to speed on the happenings. The programs offered by KDDC, especially the MILK Program, paid out larger premiums than ever before in 2013. Not only that, when we look at the impact of the program since inception, it has exceeded even our best expectations. The Dairy Consultant and MILK Program are highlighted in the next paragraphs. Meetings/Dairy Promotions/KDDC Influence The KDDC regional dairy consultants, (DC) put in a lot of hours and logged many miles as they fulfilled their assigned duties throughout 2013. We also saw Northern KY Dairy Consultant, Willy Campbell say goodbye as he started a new job in October in his home county. The information
below comes from weekly reports provided by KDDC’s DC of farm visits, meetings attended, promotion events held and new program signees. • The DCs made 1,919 total dairy farms visits in 2013. Every dairy farm was visited, although producers were not available on every visit. • Dairy Meetings: 128 educational meetings were cumulatively attended by the DCs. • Dairy Promotions: 93 events across the state were attended including several where KY Kate was exhibited. More than 28,000 total attendees were at these events. • Nutrient Management and Water Quality meetings and the Floyd’s Fork TDL Meetings were attended with KDDC providing input to the KY Ag Water Quality Livestock Committee. • The KDDC Young Dairy Producers Conference and the KY Dairy Partners were held in Bowling Green, KY with over 300 people in attendance. The WI Dairy tour had 65 total attendees. • KDDC was invited and attended the National Dairy Leaders Coalition during the Professional Dairy Producers of Wisconsin Annual Business Conference. The KDDC MILK Program: The information below was gleaned from the MILK Program records accumulated since 2007. • Enrolled 28 percent of all dairy farmers in the state. (216/744 as of Dec. 2013) • Over 48 percent of all milk produced in KY annually is represented in the program. • More than 7,025 tanker loads (50,000 lbs. each) or over 351,267,216 lbs. of milk over base production was generated by MILK Program farmers since 2007. • Approximately $7 million in transportation cost savings to milk handlers by producing an additional 7,025 tanker loads of milk locally. • Increased income of more than $66. 9 million to producers for additional milk over base. • Distributed over $4.1 million in total premiums directly to participating KY dairy farmers. • Instrumental in lowering SCC of KY produced milk to 251,000 ml/1,000 by utilizing regional dairy consultants in collaboration with University of KY Dairy Extension. The KDDC MILK Program had a huge economic impact on dairy farmers, their communities and the state. When combining the $4.1 million Cont’d on page 2