https://www.rfdtv.com/keep-it-flowing-u-s-per-capita-dairy-consumption-returns-to-1950s-levels
NMPF Executive Vice President for Communications & Industry Relations Alan Bjerga discusses new USDA data showing that per-capita dairy consumption among Americans is back to 1950s levels, in an interview with RFD-TV. Robust holiday sales could push consumption to even higher levels. “We can do this, America,” Bjerga said.
By Allison Wilton, Coordinator, Economic Policy & Global Analysis, NMPF
High prices are supposedly the cure for high prices. That may not be the case with beef-on-dairy.
In recent years, the popularity of crossbred calves has grown exponentially as dairy farmers faced tight margins and beef cattle fetched record prices. Margins have improved on the dairy side, but the beef market has shown few signs of cooling down, suggesting a dairy herd boom is unlikely to materialize.
The beef herd is typically cyclical in nature, even as it has steadily shrunk since the 1990s. It’s now the smallest since 1951, leaving little supply cushion when weather or markets cause disruption. Droughts in 2022 and 2023 pushed many ranchers to liquidate herds; heifer and cow cull rates climbed in 2022 (up 4.8% and 10.9%, respectively), sparking the current cycle of high prices. Today, even with sky-high beef prices, calves on the ground at the beginning of 2024 were down 2.7% from the year earlier.
With drought in decline, ranchers may be looking to rebuild their herds. But a beef supply increase will take time. It will even result in higher prices in the short term as producers retain more heifers, which typically take at least two years to calve, and it will take another two years for those calves to be processed. Beef producers also operate under similar incentives as dairy farmers where today’s prices are pushing many to eschew a herd rebuild in favor of sending calves to market as soon as possible. These factors will all constrain the supply of beef animals for the next few years and support elevated prices for dairy-beef crosses.
Is change ahead?
Even as the beef herd is likely to remain constrained for the foreseeable future, two factors could still lower prices.
First, U.S. dairy farmers’ foray into beef crosses could shift supply dynamics in the beef market. U.S. farmers and ranchers purchased 9.4 million units of beef semen in 2023, according to the National Association of Animal Breeders, double as much as just five years ago. Notably, 85% of the beef semen purchased was by dairy farmers. Those calves have only recently made it to feedlots.
Second, several high-profile announcements of new feedlots specifically designed for dairy-beef crosses are likely to further entrench dairy’s investment in beef, permanently expanding the universe of potential beef production. Dairy could possibly cool off the beef market, but dairy’s own limitations to growing its herd naturally limit how many beef calves can come from dairy without seeing the dairy herd itself expand, which then would require switching away from beef — a highly unlikely outcome.
So, the beef herd is constrained for the foreseeable future and beef-on-dairy breeding has yet to provide enough supply to make today’s market more bearish. Demand for U.S. beef is unlikely to slow and remains relatively robust, even as consumers watch their spending. Meanwhile, global and domestic demand for protein, and specifically beef, has strengthened in recent years. U.S. beef exports grew 21% from 2015 to 2023. Tighter beef availability has limited exports so far this year (down 2% year-over-year), but growth remains the trend. Domestic demand has expanded as well, with domestic disappearance of beef 0.6% higher year-over-year in 2023, and per capita beef consumption has been rising as well.
With inflation cooling, consumers are likely to continue adding beef to their grocery carts. Until we see evidence that consumers are willing to switch from burgers to chicken or other proteins consistently, it appears beef prices are likely to remain strong and continue to limit the ability to grow the U.S. dairy herd in a meaningful way.
This column originally appeared in Hoard’s Dairyman Intel on Oct. 17, 2024.
By Nicole Ayache, Chief Sustainability Officer, NMPF and FARM
The National Dairy Farmers Assuring Responsible Management (FARM) Program will launch Environmental Stewardship (ES) Version 3 in the next few weeks, helping producers understand on-farm greenhouse gas emissions and reduction opportunities like never before.
FARM ES Version 3 uses a new scientific model, the Ruminant Farm Systems model. RuFaS offers the option to run scenarios to inform on-farm decisions on topics ranging from ration formulation to manure management strategies, cropping practices, and more. This update is timely, coming at a moment when U.S. dairy farmers are being asked to build on their legacy of natural resource stewardship and ramp up their greenhouse gas (GHG) reduction activities.
An example of the Version 3 program
The demand for GHG reductions is real and growing. Sixteen of the U.S.’s top 20 dairy processors have set a climate reduction target with the Science Based Targets initiative the leading global framework for companies to set voluntary GHG reduction goals, or have committed to setting one in the near future. Ten processors have targets that include Scope 3 emissions, which means they are looking for farm-level reductions. The voluntary carbon marketplace also shows this increasing demand: According to an analysis by McKinsey and Company, demand for voluntary carbon credits could rise by a factor of 15 by 2030.
FARM ES isn’t a carbon marketplace. But the upgraded platform gives farmers the insights and tools to assess the opportunities offered by carbon markets, supply chain inset projects, cost-share or incentive programs, and more. Farmers need access to robust, scientifically sound information so they can weigh options for reducing emission in ways that make sense for their business. Opportunities to reduce emissions can also mean reduced costs and increased productivity. The scenario analysis of the upgraded FARM ES evaluation tool includes an estimate of milk productivity changes and will grow to include financial analyses as these become available through RuFaS.
Just as with FARM ES Version 2, the upgraded platform continues to emphasize accuracy across different farm sizes, geographies, and styles. The data inputs are designed to be farmer friendly, and the core data required is similar to Version 2. Farmers also have the flexibility, but are not required, to input optional data such as reproductive programs, culling information, and farm cropping practices for more tailored results on emissions and carbon sequestration estimates.
A key focus for the rest of the year will be to collect farmer, FARM evaluator, and other stakeholder feedback, with plans to further refine the tool in 2025.
Farmers can reach out to their FARM Program evaluator to gain access to a FARM ES Version 3 platform once it launches. If the farm’s cooperative or processor does not yet participate in FARM ES, or if a farm would like to conduct a self-evaluation, reach out to dairyfarm@nmpf.org for guidance.
To learn more about the development of Version 3 and current FARM Environmental Stewardship efforts, please visit our website.
This column originally appeared in Hoard’s Dairyman Intel on Oct. 14, 2024.
NMPF Executive Vice President for Communications & Industry Relations Alan Bjerga discusses the reasons why dairy farmers may be an especially influential portion of the farm vote in an interview on RFD-TV. Because dairy farms tended to cluster around major metro areas, they’re disproportionately represented in some of this year’s most closely contested states in the competition for the White House.
NMPF President & CEO Gregg Doud said a port strike across the East Coast could cost dairy $32 million a week, and U.S. agriculture as a whole $320 million a week, in an interview with Fox Business. “We have got to make sure that we have these markets open,” Doud said, noting that even a short-term strike can cause longer-term disruptions.
Alan Bjerga, NMPF Executive Vice President of Communications, discusses how NMPF’s strong presence at the World Dairy Expo shows the breadth of the organization’s service to its members in an interview with WEKZ, Janesville, WI. NMPF-affiliated offerings include a panel on Federal Milk Marketing Order modernization, a seminar on succession planning, a look at women’s leadership in dairy and H5N1 biosecurity management on dairy farms. The National Dairy FARM Program will also be out in full force, Bjerga noted.
Shawna Morris, NMPF’s executive vice president for trade policy & global affairs, explains how Colombia moving to impose an additional tariff on U.S. milk powder exports is unjustified and unhelpful for dairy farmers and consumers in both nations. Morris speaks in an interview with RFD-TV.
By Jaime Castaneda, Executive Vice President, National Milk Producers Federation
NMPF and the U.S. Dairy Export Council (USDEC) are working to preserve market access for American dairy exports to Colombia following the Colombian government’s abrupt July 5 decision to initiate a politically driven “subsidies and countervailing measures” investigation into milk powder imports form the United States.
The move has little to do with U.S. milk and everything to do with Colombia’s domestic politics. In an effort to reverse slipping popularity with voters, the Colombian government has decided to misuse trade tools usually reserved for private industry to counter legitimate damage from “dumped” product sold at below market rates. In contrast to this, Colombia’s government has instead launched this case on its own, alleging that U.S. milk powder exports from 2020 to 2023 were unduly subsidized by U.S. government programs and damaged Colombian dairy producers. Unfortunately, due to the investigation’s political nature, the Colombian government could impose tariffs on imported U.S. milk powder products as early as September 16. That would be certain to stifle trade to the market.
NMPF and USDEC have been working with U.S. exporting cooperatives and companies, legal teams, and the U.S. government to submit a strong, data-driven defense proving that this investigation is without merit.
In their counterarguments, NMPF and USDEC note that the investigation is baseless for many reasons, including:
Because of the political nature of this investigation, a fair result is not guaranteed, which means that U.S. government intervention may be necessary. NMPF and USDEC are urging U.S. Trade Representative Katherine Tai and U.S. Department of Agriculture Secretary Tom Vilsack to use all available tools to respond forcefully should Colombia impose tariffs on U.S. milk powder imports despite the lack of evidence meriting such a result.
Congress is also paying attention. A letter sent by the bipartisan leads of the U.S. House of Representative’s Agricultural Trade Caucus to the Colombian Ambassador to the United States highlights the U.S. dairy industry’s long-standing commitment to work with its Colombian counterparts and encouraged the two industries to work together to strengthen the dairy sectors in both countries instead of pursuing meritless investigations.
Colombia’s investigation will play out over months, starting with preliminary results and potential provisional measures as early as September 16, followed by a public hearing and additional comment periods.
At stake is $70 million in annual U.S. milk powder exports to Colombia.
While not a trivial amount by any means, this investigation could also set a dangerous precedent for like-minded governments to imitate. Over the past several years, protectionist sentiments have grown around the world, and Latin America is no exception. The region has become a battleground in the effort to preserve existing trade opportunities, flaring up from Peru and Ecuador to Brazil and Mexico.
While cooperating with the investigation, NMPF and USDEC continue to engage with policymakers and allied organizations to seek a positive conclusion. Regardless of which way this investigation turns out, it’s important for the United States to respond forcefully and let its trading partners know that such maneuvers will not be tolerated.
This column originally appeared in Hoard’s Dairyman Intel on Sept. 5, 2024.
NMPF Executive Vice President Alan Bjerga talks about how dairy can offer nutritious solutions to all consumers in an interview with RFD-TV. The current drafting of a new version of the Dietary Guidelines for Americans is featuring concerns over lactose intolerance and the nutritional barrier it presents some consumers. Bjerga points out the wide range of low-lactose and lactose-free products, which represents an important part of dairy’s future.
NMPF Executive Vice President of Communications Alan Bjerga discusses the plethora of low- and no-lactose dairy products available to meet America’s nutritional needs in an interview with Dairy Radio Now. With societal concerns about equitable nutrition access informing conversations over the upcoming Dietary Guidelines, dairy needs to make it clear that it’s a nutrition solution for all, Bjerga says.
By Paul Bleiberg, Executive Vice President, Government Relations, National Milk Producers Federation
Milk and dairy products supply 13 essential nutrients, including three that continue to be identified as nutrients of public health concern: calcium, potassium, and vitamin D.
The U.S. Department of Agriculture and the Department of Health and Human Services have historically recognized dairy’s important value in the Dietary Guidelines for Americans, which are updated once every five years and are due next year. The 2025-2030 Dietary Guidelines should continue to maintain dairy as a distinct food group, one that does not include plant-based imitation products that are not nutritionally equivalent to real milk and do not deliver dairy’s unique nutrient package.
But before the new guidelines are completed, Congress has the opportunity this year to highlight dairy as a nutrition powerhouse that cannot be easily replicated. Below the radar of a tumultuous presidential election year, the bipartisan DAIRY PRIDE Act, introduced in both houses of Congress, has steadily picked up additional support, with nearly 50 members now cosponsoring the House measure.
The DAIRY PRIDE Act directs the Food and Drug Administration (FDA) to enforce dairy standards of identity, which are rooted in dairy’s critical nutrient profile and the fact that milk is the product of an animal that can’t be replicated by substitute ingredients or concocted in a lab. Standards of identity were developed to promote honesty and fair dealing in the interest of consumers. These terms, including “milk” and “cheese,” have come to carry distinct meaning in the minds of consumers, with built-in expectations for nutritional values.
FDA’s continued failure to require the proper labeling of plant-based alternative products is a public health problem, plain and simple. When consumers make misguided, but well-intentioned, decisions to purchase imitation products in place of real dairy, the result will be more and more Americans not meeting the recommended intake of dairy outlined in the Dietary Guidelines for Americans. Multiple public health organizations have given voice to this concern, urging that young children not be fed most plant-based alternatives in place of real dairy as their nutrition profiles are largely not equivalent.
After years of anticipation, FDA issued proposed guidance last year intended to address this topic. But while the agency acknowledged the nutritional inferiority of most plant-based imitation products relative to real dairy, FDA still made no attempt to dissuade the makers of these products from labeling them using dairy terms – the true cause of consumer confusion.
The DAIRY PRIDE Act would fix this by deeming mislabeled dairy imitators as misbranded. It then would require FDA to promptly require the proper labeling of alternative products – without the unfettered use of dairy terms. This pro-public health, truth-in-labeling bill would spotlight dairy as a unique source of essential, underconsumed nutrients and can swiftly pass Congress before year’s end.
This column originally appeared in Hoard’s Dairyman Intel on Aug. 15, 2024.
