Dairy buyout

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hurleyjd

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On the television there was a report of a dairy buyout. They report that it would suppress beef prices for a year. But after that everything would be okay for us. Maybe we do not kiss enough a$$ in Washington. We pay a good bit in the beef check off maybe it should be used to grease some palms. Just joshing about palms and a$$ kissing. As my father used to say every tub needs to sit on its own bottom. Every farmers operation should support its self with no help.
 

bigbull338

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the truth is dairy buyout would only hurt the weigh cow prices for a little while.an heres why.most all of the cows sent to packers go for hamberger.an the sellout period is spread out over 2 or 3 months.an the sellout is spread all over the US.not just in certain areas.
 

Howdyjabo

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The last Dairy buyout about broke us.
The price on EVERYTHING(cows and calves) tanked- and when the extra flow of beef finally ran out--- everyone of the Dairys that went out of business went into backgrounding calves-- and didn't have a clue how much they could afford to pay for stockers and still cash flow or they already had feed supplies on hand(paid for by our government) and didn't care if it really cash flowed---- so they pushed the price up beyond what we could afford.

And the sell off was not spread out-- it was SOOOO STUPID-- the areas that didn't have enough cows to supply local needs(smaller dairies) took the bailout and the glutted areas(big dairies) did not. It shook the cow/calf market in the rest of the country but right here it DEVASTATED it.
One thing on the upside- theres very few dairies left around here so it shouldn't be as bad locally.

If another Dairy buyout is in the works- I'm gonna lock in prices on calves before it hits- and as soon as it hits I'm gonna stockpile calves to sell when the Dairys start buying beef calves.
Last time I didn't have prices locked in- and I was too broke then(banks wouldn't even talk to me) to buy hard when the prices tanked.
 

mwj

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bigbull338":1glx22i6 said:
the truth is dairy buyout would only hurt the weigh cow prices for a little while.an heres why.most all of the cows sent to packers go for hamberger.an the sellout period is spread out over 2 or 3 months.an the sellout is spread all over the US.not just in certain areas.


If you check the cow cutouts and prices you will find that all of the high priced cuts go on plates not buns :cboy:
 

dun

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This year’s Cooperatives Working Together (CWT) herd retirement effort will remove the fewest dairy cows since the program began in 2003. It also will remove the lowest amount of potential milk production. Rounding out the triumvirate, it will also see the fewest herd buyout bids accepted.

CWT officials released the numbers for this fifth herd retirement last week. Dairy producers in 41 states submitted 609 bids, with 209 of them tentatively accepted.



Those 209 farms will sell to slaughter 25,474 cows. The projected one-year milk production that those cows will not put onto the market is 440.3 million pounds.

That 440.3 million pounds is just slightly more than two-tenths of one percent of this year’s projected U.S. total. Last month, the USDA’s Economic Research Service (ERS) predicted that the nation’s milk production would total 189.3 billion pounds this year.

The second-fewest bids were accepted in 2003, at 299. CWT accepted the most bids in 2005, with 442.

When it comes to cows, CWT removed its second-smallest amount in 2003, at 32,724. The privately funded program removed 64,069 cows in 2005, the most in its six-year history.


When it comes to potential milk production, CWT removed its second-lowest amount in 2003, at 609.2 million pounds. In 2005 it removed its most potential milk production n 117.36 million pounds.

Bob Cropp, an emeritus professor of agricultural economics at UW-Madison, thinks this latest CWT round will have “some” impact, even though few bids were accepted and less cows are being removed.

“This will help keep milk prices up,” he says. “How much, I can’t say.”

Cropp adds that he thought this latest version of CWT would draw more interest than it did, due to high feed costs. But, apparently, he says, strong milk prices trumped high feed costs.

The number of dairy farmers offering to sell their herds through CWT fell steadily until 2007. That year, 1,374 producers submitted bids, compared to 657 in 2005, 736 in 2004, and 2,038 in 2003.

This year, the highest number of “accepted” bids came from the Midwest, also called “region three.” This area consists of Wisconsin, Minnesota, Iowa, Illinois, Michigan, Indiana, Ohio and both Dakotas.

Region two n the Southeast states n had 38 bids accepted, followed by 36 for the Southwest, 30 for the Northeast, and 29 for the West.

Most of the cows will be removed from the West n California, Idaho, Montana, Nevada, Oregon, Utah, Washington and Wyoming. Dairy farmers there will sell to slaughter 9,078 cows.

Their counterparts in the Southwest will sell 5,189 cows, while those in the Southeast will sell 4,228. The Midwest will get rid of 4,124 cows, and the Northeast will lose 2,855.

Most of the eliminated milk production will also come from the West. The CWT cows from those eight states were projected to produce 162 million pounds if they were not slaughtered.

The next-largest cut in milk production is from the Southwest n Arizona, Colorado, Kansas, Nebraska, New Mexico, Oklahoma and Texas. There, 84 million pounds of milk will not be produced.

Thanks to CWT, the Midwest will lose 70 million pounds, while the Southeast loses 68 million. Finally, the Northeast will lose 65 million pounds of milk.

New wrinkles

This year’s CWT herd buyout has a couple of new wrinkles. First, round did not contain “regional safeguards.” That is, CWT officials did not try to limit the amount of milk production any of its five regions would lose.

The second new wrinkle is the offer to buy bred heifers. Christopher Galen, a spokesman for the National Milk Producers Federation (NMPF), which administers CWT, told Agri-View that only farms whose herd buyout bids were accepted can also sell its bred heifers for slaughter through CWT.

However, bred heifers do not have to go to slaughter with cows. But a farm whose bid was accepted did have to sell all its bred heifers n not just some of them n if it was going to sell any.

In all, this year’s CWT buyout will remove 358 bred heifers from participating farms. The Southeast leads with 172 bred heifers being sold, followed by the West with 101. Next come the Southwest with 36, the Midwest with 32, and the Northeast with 17.

Galen said there is no delay between the time a farm sells its cows through CWT and when it can begin milking again. Thus, a likely explanation for just 172 bred heifers going to slaughter.

“The price we offered (for bred heifers) was modest,” Galen added. “It was a flat fee of $1,050 per animal. It’s possible that a lot of people thought that was less than the market could return.”

Auditors are expected to start visiting the 209 farms with accepted bids this week. They will examine milk production records, inspect the herds, and ear tag each cow and bred heifer.

When that is all done farmers have 15 days to send their CWT animals to slaughter. Farmers get to keep the money from the slaughter, along with being paid the amounts of their accepted bids. Last year the average accepted bid was $5.50 for every hundredweight of milk the slaughtered cows would have produced.

CWT says all farmers who offered bids will be notified by Aug. 12 as to whether their bids were accepted. The amounts of the bids will be released by around Labor Day or the end of August, according to Galen.

In a news release, CWT says, “This latest round of CWT’s milk reduction program should help strengthen farm prices for milk at a time when dairy producers are suffering from rising feed and fuel costs.”
 

bigbull338

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most all of the dairies that sold out will retire completely esp those that sold all their bred heifers.if i sold out id keep my heifers.an go back in when they started calving.
 

TexasBred

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mwj":2f4ynws8 said:
bigbull338":2f4ynws8 said:
the truth is dairy buyout would only hurt the weigh cow prices for a little while.an heres why.most all of the cows sent to packers go for hamberger.an the sellout period is spread out over 2 or 3 months.an the sellout is spread all over the US.not just in certain areas.


If you check the cow cutouts and prices you will find that all of the high priced cuts go on plates not buns :cboy:

Ever tried to process a 5 year old dairy cow, thin as a rail producing 100 lbs. of milk a day?? Ain't just a lot of prime cuts there and I know you wouldn't want to pay $10 for a ribeye off her.
 

TexasBred

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bigbull338":f3v989j4 said:
most all of the dairies that sold out will retire completely esp those that sold all their bred heifers.if i sold out id keep my heifers.an go back in when they started calving.

Bull...I know 4 dairymen who recently liquidated in this most recent buyout. Two are already milking again and the other 2 plan to get started shortly. The whole thing is a complete joke. And milk prices continue to go down.
 

bigbull338

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bro the whole dairy buyout was a joke from the very beginning.now the cwt is all i would consider selling out on.if i was still milking.because the next morning after the cows left.i could fire the barn up an go back to milking.
 

GMN

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TexasBred":o2kic88p said:
bigbull338":o2kic88p said:
most all of the dairies that sold out will retire completely esp those that sold all their bred heifers.if i sold out id keep my heifers.an go back in when they started calving.

Bull...I know 4 dairymen who recently liquidated in this most recent buyout. Two are already milking again and the other 2 plan to get started shortly. The whole thing is a complete joke. And milk prices continue to go down.

Plus we get a % taken out of our checks for the cwt program, so its kind of like we are paying for others to to sell out their herds, and like you say TB this program was put into motion to keep milk prices from being too low, well next month its predicted they will fall to $12.41, so evidently its not working! HELLO!

Yet we still are paying for it, plus a diesel surcharge, don't even get me started on that!

GMN
 

TexasBred

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GMN......February Class III Milk Futures.....$9.36... March $9.70.....whoopeee...Still getting those 1950's milk prices on the farm.
 

bigbull338

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we was getting 1950s prices in the 70s 80s an 90s.id love to still be milking cows even with all the headaches.the $9.36 an $9.50/100 wont even pay the feed bill.ahhhhhhhh the good old days.
 

GMN

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TexasBred":1wnw6i54 said:
GMN......February Class III Milk Futures.....$9.36... March $9.70.....whoopeee...Still getting those 1950's milk prices on the farm.

Grade A won't fall under $10, never has never will. Last time it got close, DFA enacted some program via them and it never got under $10. I don't think prices will fall that low, maybe Grade M, not for Grade A. The MILC program will pay out something, but not enough to cover the difference.Time to buckle down, continue on or get out.

GMN
 

TexasBred

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GMN":3o5nkjz3 said:
TexasBred":3o5nkjz3 said:
GMN......February Class III Milk Futures.....$9.36... March $9.70.....whoopeee...Still getting those 1950's milk prices on the farm.

Grade A won't fall under $10, never has never will. Last time it got close, DFA enacted some program via them and it never got under $10. I don't think prices will fall that low, maybe Grade M, not for Grade A. The MILC program will pay out something, but not enough to cover the difference.Time to buckle down, continue on or get out.

GMN


Gov't price support use to be $13.10...don't know if it has changed or not. BUT, from that you have all your deductions so you're mailbox price may not be much over $10 a hundred-weight.
 

whitecow

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I just got this in an email from the TX Cattle Feeders Association....

Volume 43, Number 3.1
January 23, 2009

Bulletin:Dairy Buyout

Call Your Senator Immediately To Oppose The Dairy Buyout!Citing overproduction and economic hardships, dairy groups are urging Congress to include language in the economic stimulus bill that would use taxpayer funds to purchase nearly 320,000 head of older cows from dairy farmers.

TCFA and NCBA have contacted Members of the House and Senate to inform them about the consequences that a dairy buyout would have for cattle producers and urge them to oppose any such proposal.TCFA will continue its efforts to block this proposal in the Senate, but we also need your help.Please use the letter posted athttp://capwiz.com/beefusa/issues/aler ... 12482171as a template to write and send your own letters or make phone calls to your Senators.

The proposed buyout would remove approximately 6.5 billion gallons of milk from the market and increasing dairy prices.That might sound like a good idea to the dairy industry, but cattle feeders understand all too well the dramatic effects such a proposal would have on the beef market.A similar dairy buyout plan was implemented in 1986 and resulted in a 25% decrease in the price paid to producers for beef cattle and sent the cattle market to its lowest point in the last 30 years.In total, the beef industry saw a $1 billion loss from the 1986 buyout.

The dairy industry's initial efforts to include the buyout language in the House bill were stymied because a number of Congressmen raised concerns about the proposal, labeling it an earmark.However the dairy groups have redoubled their efforts in the Senate where a committee markup of the stimulus bill is scheduled for early next week.
 

TexasBred

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Whitecow, the dairy co-ops are probably telling everyone to write their congressmen and ask them to vote for the thing. Each just looking out for their own. I do hate to see that many cattle go to slaughter at one time, knowing that in the long run the dairy farm operator won't get one nickel increase in his milk prices related to this type action.........but..assuming he does..... it will be short lived.
 

bigbull338

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ok im going to pull the trigger an prolly get this thread locked down.theres a simple reason why they say we are over producing milk.an thats the dairymen flooding in here from other countries.an opening up dairies.that are financed by their home gov giving them low interest loans.thus forcing the family dairy out that milked from 30 to 100 cows.forcing the dairies that stayed to get big or get out.the dairies im talking about milk from 1000 to 4000 or more cows.an if you think im angry your right.its because of those dairies that we sold out.
 

GMN

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bigbull338":wxj8vhdk said:
ok im going to pull the trigger an prolly get this thread locked down.theres a simple reason why they say we are over producing milk.an thats the dairymen flooding in here from other countries.an opening up dairies.that are financed by their home gov giving them low interest loans.thus forcing the family dairy out that milked from 30 to 100 cows.forcing the dairies that stayed to get big or get out.the dairies im talking about milk from 1000 to 4000 or more cows.an if you think im angry your right.its because of those dairies that we sold out.

They say we are overproducing milk, yet they do the herd buyouts and brag how Xamount of cows have been taken out of production, causing less milk to be produced, which SHOULD BE causing prices to remain higher. Evidently its not working for whatever reason. Doesn't really matter why, because in the end, the result will be more dairies having to go out of business.

I'm angry too, that i have to do all the same amount of work, and more, and get paid about $12 less per cwt, as I was about this time a year ago. :mad:

Plus I'm mad that I have to just take it, and that the cost of living has skyrocketed, and that every time I turn on the news I hear some other company is laying off thousands of workers, and I think its only gonna get worse before it gets better.

THEN, I think, I am grateful for all the things I do have. I might not have a big fancy house, or alot of money, but I have some real good friends, a great family, and to me that is worth more than any amount of money in this whole topsy turvy world. :)

I think BB you are a good ally to the dairy farmers, maybe someday you can be involved in a dairy again,one of those neices or nephews..

GMN
 

bigbull338

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thanks ive got dairing in my blood.an it runs deep in my old bones.an if i was able to hold up to the long hours an backbraking work id still be milking cows.i hold on to the fact the kids might come home an start another dairy.but i doubt that day will come true.use old dairymen dont die.we just fade away an keep milking.
 

mwj

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Would you by any chance have a source for rolling herd milk-averages. The last time I milked was in the late sixty's and the advances since then have been huge. With improved genetic selection and tailored feed rations the production no. must be fairly high.
 

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