Dairy prices that plunged, then skyrocketed, have settled – for a moment. But volatility should be expected as long as COVID-19 makes its way through the economy, said Peter Vitaliano, chief economist for the National Milk Producers Federation.

“It has been indeed a roller coaster,” Vitaliano said in an NMPF podcast released today. Vitaliano, who writes NMPF’s monthly Dairy Market Report, said the extent of coronavirus-related closures this fall and how much farmers increase milk production will remain significant questions for the rest of the year. To subscribe to the Dairy Market Report, click here.

To listen to the full discussion, click here. You can also find this and other NMPF podcasts on Apple Podcasts, Spotify and SoundCloud. Broadcast outlets may use the MP3 file. Please attribute information to NMPF.

 

A bipartisan coalition of House lawmakers today sent a letter urging the U.S. government to proactively enforce the United States-Mexico-Canada Agreement’s (USMCA) dairy-related provisions. This letter is being applauded by the U.S. dairy industry, as the benefits that USMCA secures for America’s dairy farmers, processors and exporters will only be realized if the deal is fully enforced.

Representatives Ron Kind (D-WI), Tom Reed (R-NY), Collin Peterson (D-MN), Glenn “GT” Thompson (R -PA), Anthony Brindisi (D-NY), Russ Fulcher (R-ID), Xochitl Torres Small (D-NM), and Anthony Gonzalez (R-OH) led this effort. In total, 104 members of Congress signed the letter.

“A strong demand for U.S. dairy exports abroad drives economic growth and creates jobs here at home. USMCA is designed to allow the U.S. industry to fulfill this demand from two of our largest dairy customers and we cannot allow Canada or Mexico to undermine the important gains secured in this trade deal. We are working alongside Congress, the U.S. Trade Representative and the U.S. Department of Agriculture to ensure Canada and Mexico are held accountable to their trade commitments,” said Tom Vilsack, president and CEO of the U.S. Dairy Export Council.

According to the International Trade Commission, if USMCA is implemented as negotiated, U.S. dairy exports are projected to increase by more than $314 million a year.

“The support for today’s bipartisan letter demonstrates the incredible impact the U.S. dairy industry has across the country, supporting our rural economies and fulfilling an essential role in feeding America. USMCA is a modernized trade deal that represents new opportunities for our farmers and processors after years of rural recession and the new challenges presented by the current crisis. We must utilize USMCA’s enforcement mechanisms to bring home its hard-fought wins for America’s dairy farmers,” said Jim Mulhern, president and CEO of National Milk Producers Federation.

Specific provisions of concern to the U.S. dairy industry highlighted in this letter include Canada’s administration of its dairy Tariff Rate Quotas (TRQ), the full and transparent elimination of Classes 6 and 7 and related dairy pricing program disciplines, and the enforcement of the side letter agreements with

Mexico that protect market access for U.S. common names cheeses. Urgent enforcement is needed as Canada and Mexico have already demonstrated reluctance to adhere to their trade obligations, as exhibited by Canada’s recently announced TRQ allocations that run counter to the intent of USCMA to expand access to the Canadian dairy market.

The Dietary Guidelines for Americans Committee’s scientific report reaffirms dairy’s important role in a healthy diet, but government officials need to take into account evolving science that shows the benefits of dairy fats when it releases its final report, said Miquela Hanselman, NMPF’s manager for regulatory affairs, during a virtual meeting of the U.S. Department of Agriculture and the Department of Health and Human Services discussing the report.

“The committee, correctly in our view, maintained dairy as its own group and did not allow the inclusion of any plant-based beverages or foods other than fortified soy beverage,” Hanselman said. “Furthermore, the committee gave a nod to dairy’s nutrient density, and included it in food recommendations developed for 6-24 months.

Still, there’s work to do, she added.

“The Committee did fall short on one topic: the recognition of the newer science on dairy fats. Although we are pleased that the committee didn’t lower the saturated fats daily limit, we wish they had included the newer science on dairy fats in their recommendation. While the committee did acknowledge the need for more research and analysis on fat sources and food matrices, they failed to include the breadth of science that already exists in this area in their review. For this reason, we urge USDA and HHS to review the scientific literature on dairy foods at all fat levels and draw their own conclusions.”

The final 2020 Dietary Guidelines for Americans are expected to be released later this year. Dairy advocates have until Aug. 13 to submit written comments on the guidelines by joining NMPF’s call to action here. A copy of Hanselman’s testimony is here. Full audio of Hanselman’s testimony is here. Broadcast outlets may use the MP3 file. Please attribute information to NMPF.

This article was written by NMPF Trade Manager Tony Rice for United Dairymen of Arizona’s Fall 2020 magazine.

As 2020 began, America’s dairy farmers and dairy cooperatives looked forward to expanded trade opportunities. The recent accord reached on the Japan Phase One agreement, the soon-to-be-completed Phase One trade agreement with China, and the imminent final passage of the United States-Mexico-Canada Agreement (USMCA) all represented hope for our industry after years of low milk prices and a persistent rural recession.

For Arizona, the modernized trade rules ushered in by USMCA were particularly important, as they helped restore certainty to our trade relationship with Mexico, a more than $150 million market for Arizona dairy exports in 2019.[1]

What no one anticipated at the start of this year was a global pandemic that would create immense challenges for U.S. dairy exports to markets around the world, including Mexico. Unfortunately, the Mexican government, under the leadership of President Andrés Manuel López Obrador, has compounded these difficulties by also raising new concerns about potential new trade barriers and heeding calls from some domestic producers to seek to limit competition through protectionist policies. To add insult to injury, a few members of the Mexican Congress are also bowing to pressures from a single farm group in Mexico and, as such, are revisiting a push to impose import taxes on dairy products – a notion that dairy has successfully defeated before and will again.

As the coronavirus pandemic took hold in the spring, the U.S. dairy industry saw a dramatic drop in dairy exports to Mexico, as demand normally driven by schools, restaurants and other food service establishments fell. The value of U.S. dairy exports to Mexico in May fell nearly 30% when compared to the year before.

The flow of U.S. dairy exports was, for a time, restricted even further as the Mexican Ministry of Health imposed limitations on the issuance of import permits, a step that further hindered already tight dairy supply chains. NMPF, working closely with UDA and USDEC, stepped in immediately to coordinate with government officials on both sides of the border to keep U.S. dairy products flowing uninterrupted and Mexican grocery store shelves stocked.

Additional challenges quickly emerged as Mexico published a discriminatory draft cheese Conformity Assessment Procedure (CAP) that threatens to introduce more complications for U.S. cheese exports due to proposed new testing requirements that would treat imports differently than domestic products and subject U.S. cheeses to burdensome testing requirements. This CAP conflicts with USMCA’s intent to improve trade flows. It’s also inconsistent with Mexico’s international trade obligations to provide equitable treatment to imported goods.

Unfortunately, the Mexican government has yet to implement regulations enabling it to enforce the negotiated side letters in USMCA that establish protections for American-made cheeses with common names, such as parmesan and gouda. Enforcement of these agreements is critical to secure the full range of protections for common cheeses negotiated within USMCA, especially as Mexico and the European Union move toward implementation of the trade agreement reached in 2018.

NMPF, working hand in hand with UDA and USDEC, tackles each of these trade roadblocks, is continually advocated for Arizona dairy interests and exports by remaining engaged with the U.S. Trade Representative, the U.S. Department of Agriculture and other government and industry stakeholders. We will continue to fight for trade policies that break down trade barriers, strengthen the U.S. working relationship with Mexico, and bring home tangible benefits to the rural communities in Arizona and beyond that continue the essential work of producing high-quality American-made dairy products.

[1] Per UDA press release: https://azgovernor.gov/governor/news/2020/04/governor-ducey-requests-export-assistance-arizonas-dairy-farmers

 

The release of the scientific report of the U.S. Dietary Guidelines Advisory Committee has brought predictable criticism from dairy’s detractors, annoyed that a high-nutrient food they dislike for various, easy-to-debunk reasons provides important benefits throughout life and offers essential nutrients Americans otherwise lack without it.

The committee’s scientific report, which is open for public comment through this Thursday, is explicit about dairy’s benefits. The panel report also provides a road map showing what the next dietary guidelines panel needs to see to emphasize dairy’s dietary benefits even further. The panel report is worth a thank-you note – and a nudge forward in evaluation of fats — from dairy advocates. In fact, a letter is all set up and ready to go, the only catch being that it has to be sent by Thursday.

Some highlights from the 835-page report released last month:

• Dairy is recommended for consumption within all three healthy eating patterns featured in the report, with three servings per day recommended in the Healthy U.S. style eating pattern and Healthy Vegetarian Style patterns and two servings per day in the Healthy-Mediterranean pattern;

• Americans need more dairy in their diets. 88 percent of them fall short of the panel’s recommendations. That includes 79 percent of 9-13-year-olds, who rely heavily on the school-lunch program to meet nutritional needs.
• The committee recognized milk as a nutrient-rich beverage that contributes positively to under-consumed nutrients, including potassium, calcium, phosphorus, magnesium, vitamins A and D, and others;
• Low-fat and nonfat dairy foods are recommended as nutrient-dense building blocks of a healthy diet; and
• In the committee’s first-ever recommendations for birth through 24 months, yogurt and cheese are recognized as complementary feeding options for infants ages 6-12 months, and dairy foods (milk, cheese and yogurt) are included in healthy eating patterns for toddlers 12-24 months.

The report, which the federal government will use when it sets its official Dietary Guidelines for Americans later this year, could have gone even further. Despite mounting evidence of the neutral to beneficial health impact of milkfat, the committee did not fully address the issue. This is disappointing, but the report does still takes a step in the right direction by laying groundwork for dairy’s health benefits to be recognized even more fully in the next dietary guidelines. Tucked on page 791 is a recommendation to:

Examine the effects of different food sources of saturated fats, including animal (e.g., butter, lard) and plant (e.g., palm vs coconut oils) sources, different food matrices that encompass saturated fats (e.g., saturated fats in cheese vs yogurt), and different production techniques (e.g., refined deodorized bleached vs virgin coconut oil) on health outcomes.

Translation: Recent studies showing that dairy fats may be higher-quality and more beneficial than other types of fats are intriguing, but more of them are needed to upend at least five decades of conventional wisdom. That’s the kind of statement from which nutrition scientists can take their cues – and sends a strong signal to them, and to government officials, that it’s time for the long-overdue re-evaluation of whole milk that’s needed to boost healthy diets.

But as we continue building toward that end, it’s important to let the panel know its reaffirmation of dairy was noticed, even as science needs to be nudged forward. The National Milk Producers Federation has a call-to-action campaign on its website (you can go to it directly here) meant to help dairy advocates send the positive message the USDA and Department of Health and Human Services needs to receive as it finalizes the government guidelines. The comment deadline is Aug. 13.

Good things are going dairy’s way. Higher retail sales, along with a greater appreciation of dairy farmers and their cooperatives in a time of crisis, are reasons to be upbeat despite today’s challenges. The Dietary Guidelines are another help – and their improvement is a cause worth pursuing.

The U.S. Department of Agriculture (USDA) Agricultural Marketing Service once again approved the National Dairy Farmers Assuring Responsible Management (FARM) Animal Care Program’s animal welfare standards, determining that the program’s 4^th version meets the requirements of the International Organization for Standardization (ISO) Technical Specification. FARM was the first animal-care program in the world to have its updated standards verified through this process.

“The ISO certification for the FARM Program demonstrates its importance and validates our industry’s commitment to animal care not only domestically but also in the world market,” said Jim Mulhern, president and CEO of the National Milk Producers Federation, which administers the FARM program.

The assessment to the ISO standard determines whether animal welfare programs meet international standards for animal care as set by an independent standards-setting organization. FARM was evaluated to ensure that the standards in Version 4.0 of its Animal Care program meet the highest quality in species-specific welfare practices.

The World Organization for Animal Health (OIE) and ISO work together to help farmers and programs like FARM standardize and implement their animal care guidelines. The OIE, the World Trade Organization-recognized body for setting animal health and welfare standards affecting international trade, adopted dairy cattle welfare standards in 2015.

FARM was the first livestock program in the world recognized for the technical specification in 2018. It repeated the USDA verification process to provide an additional level of assurance for the improvements made to the program in its fourth iteration. The verification by USDA signifies to FARM Program participants that its standards are among the best in the world; it also signals to consumers they can have confidence their dairy products were produced in accordance with the highest level of science-based animal care.

NMPF made two crucial staff moves in July, adding its first-ever communications director for the National Dairy Farmers Assuring Responsible Management (FARM) Program and promoting a key staff member in trade policy.

Leighona Bernstein comes to the FARM team from CropLife International, the global trade association of the plant science industry, to direct FARM communications efforts to both internal and external stakeholders. Key to that mission will be weaving the stories of dairy producers into larger industry narratives, as well as providing timely and important information on FARM’s efforts to ensure best practices across dairy farms nationwide.

“Leighona brings the perfect mix of member-focused communications with external outreach experience,” said Emily Yeiser-Stepp, NMPF’s vice president for FARM and the director of the program. “The FARM Program looks forward to her impact in developing further value for all of our stakeholders.”

Leighona’s focus on agriculture began during her years as a nationally competitive equestrian at Oklahoma State University. After graduation she worked at Oklahoma Today magazine before joining CropLife International. She began at NMPF, which administers the FARM program, on July 13.

Also this month, NMPF promoted Tony Rice, who joined NMPF as its Trade Policy Coordinator in June 2019, to Trade Policy Manager.

Rice comes from a dairy farm family in Pennsylvania. He’s been an integral part of the trade team since joining NMPF, playing a crucial role in a range of trade policy activities from developing more robust trade-data analysis to supporting the creation of materials that inform the dairy industry about trade policy on topics such as geographical indications and the USMCA trade agreement.

“Tony has jumped into our wide swath of activities on trade policy topics with both feet, playing a key role in allowing NMPF take on an even more active role on the key trade issues so important to shaping returns to dairy farmers. He’s efficiently and quite effectively contributed to our work on beneficial trade agreements, trade data analysis and communicating to our members and the wide industry information they need to know about the policy landscape,” said Shawna Morris.

In his new role, he will take on a broader role in managing projects supporting U.S. efforts to boost U.S. dairy exports and improve market access through leveling the playing field.

At their June meeting, the NMPF Scholarship Committee selected three graduate students to receive scholarships as part of the 2020 NMPF National Dairy Leadership Scholarship Program. These students are conducting research in areas that will benefit dairy cooperatives and producers. Scholarship were awarded to:

• Ellen Lai, a PhD candidate in Integrative Genetics and Genomics at the University of California, Davis, whose research focuses on improving production and welfare of Holstein cattle by providing genetic tools to reduce lameness caused by foot warts and sole ulcers.
• Conor McCabe, a MS candidate in Animal Science at Purdue University, studying tissue mobilization in transition dairy cows.
• Mateus Peiter, a PhD candidate in Animal Science at the University of Minnesota studying the use of automated technologies to improve animal health and herd management on dairy farms.

Congratulations!

CWT assisted member cooperatives in securing 48 contracts to sell 1.7 million pounds of American-type cheeses, 41,888 pounds of butter, 13.1 million pounds of whole milk powder, 1.157 million pounds of anhydrous milkfat (AMF), and 776,027 pounds of cream cheese to customers in Asia, Central and South America, the Middle East, and Oceania. The product will be shipped to customers in 11 countries in those six regions of the world during the months of July 2020 through January 2021.

These contracts bring the 2020 total of CWT-assisted product sales contracts to 22.2 million pounds of cheese, 6.3 million pounds of butter, 31.3 million pounds of whole milk powder, 3.1 million pounds of AMF and 4.4 million pounds of cream cheese. These transactions will move the equivalent of 694.2 million pounds of milk on a milkfat basis overseas.

Exporting dairy products is critical during these challenging times to the viability of dairy farmers and their cooperatives across the country.  Whether or not a cooperative is actively engaged in exporting cheese, butter, anhydrous milkfat, cream cheese, pasteurized process cheese, or whole milk powder, the moving products into world markets is essential. CWT provides a means to move domestic dairy products to overseas markets by helping to overcome U.S. dairy’s trade disadvantages.

The amounts of dairy products and related milk volumes reflect current contracts for delivery, not completed export volumes. CWT will pay export assistance to the bidders only when export and delivery of the product is verified by the submission of the required documentation.

All cooperatives and dairy farmers are encouraged to add their support to this important program. Membership forms are available at http://www.cwt.coop/membership.