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Feed and Pay Price January 2022

By Ed Maltby, NODPA Executive Director

The USDA AMS reports for the months of October and November 2021 that the total fluid products sales of packaged fluid product shipped by milk handlers was 3.8 billion pounds of milk in both months which were lower than in 2020, but that was an abnormal year. For organic, the volumes of milk were 224 and 230 million pounds correspondingly, and the comparison with 2020 was -5.4% for October and -1.8% for November.

The charts below and the information on organic sales above are the information provided by the Federal Milk Marketing Orders (FMMO) for retail sales. Every region of the FMMO produces a monthly statistical report that is published up to 2 months in arrears of the usage. The FMMO data is derived from reports submitted by pooled handlers. The majority of organic milk is processed at FMMO pool plants that also process and manufacture conventional milk. But these reports do not give an accurate picture of utilization of organic milk, especially given the sales of organic yoghurt. Providing only part of the needed data, however, the information can also be combined to get an inaccurate picture of utilization of organic fluid milk in the marketplace and total sales of organic milk.

Estimated total US Sales of Fluid Milk Products (Class 1) for October 2021

Product Name

Sales of Organic Fluid Milk

Change from

Oct-21

2021 Year to date

Oct-20

Year to date

Million pounds

Percent

Organic Whole Milk

103

1,040

-0.6%

-1.1%

Flavored Whole milk

2

15

10.2%

96.3%

Organic Reduced Fat Milk (2%)

74

794

-11.4%

-3.00%

Organic Low Fat Milk (1%)

25

262

1.2%

-6.0%

Organic Fat Free Milk Skim

14

146

-18.4%

-11.2%

Organic Flavored Fat-Reduced Milk

6

70

-3.6%

3.7%

Other Fluid Organic Milk Products

0

1

158.0%

-3.2%

Total Fat Reduced Milk

119

1,273

-9.5%

-4.3%

Total Organic Milk Products

224

2,328

-5.4%

-2.6%

Estimated total US Sales of Fluid Milk Products (Class 1) for November 2021

Product Name

Sales of Organic Fluid Milk

Change from

Nov-21

2021 Year to date

Nov-20

Year to date

Million pounds

Percent

Organic Whole Milk

106

1,146

2.2%

-0.8%

Flavored Whole milk

2

17

30.3%

85.60%

Organic Reduced Fat Milk (2%)

78

872

-5.5%

-3.2%

Organic Low Fat Milk (1%)

25

287

7.6%

-5.0%

Organic Fat Free Milk Skim

14

160

-14.9%

-11.5%

Organic Flavored Fat-Reduced Milk

5

75

-27.0%

0.7%

Other Fluid Organic Milk Products

1

1

64.3%

14.9%

Total Fat Reduced Milk

123

1,396

-5.3%

-4.4%

Total Organic Milk Products

230

2,559

-1.8

-2.5

Federal Milk Market Order 1(FMMO-1), in New England, reports utilization of types of organic milk and cream by pool plants. In October and November 2021, Class 1 utilization of organic whole milk totaled 13.8 and 14.32 million pounds respectively, increasing from 12.25 million in October 2020, and increasing significantly from 11.8 million pounds in November 2020. The utilization of organic reduced fat milk in October and November 2021 was 15.66 and 16.75 million pounds respectively, an increase from 13.53 million pounds in October 202 and up from12.67 million pounds in November 2020. Year-to-date, there has been an increase of 11% (30.96 million pounds) of organic milk utilized as retail packaged product in the FMMO-1 from January to November 2021 as compared to January to November 2020. We have no independent tracking of sales of other organic dairy product.

UTILIZATION OF ORGANIC FLUID MILK PRODUCTS AND CREAM BY POOL PLANTS FMMO 1(Million pounds)

Fluid retail Organic Milk 2021

Fluid retail Organic Milk 2020

Increase/Decrease over 2020

JANUARY

31.32

23.93

31%

FEBRUARY

31.56

26.69

18%

MARCH

31.87

27.90

14%

APRIL

28.97

29.35

-1%

MAY

29.72

28.25

5%

JUNE

28.41

26.90

6%

JULY

25.50

26.70

-4%

AUGUST

27.18

24.70

10%

SEPTEMBER

30.26

29.70

2%

OCTOBER

29.47

25.78

14%

NOVEMBER

31.07

24.47

27%

In bad news for organic dairies whose winter ration includes purchased protein, USDA reports that the organic soybean feed price is the highest its been since their records started in 2008 and organic soybean meal is getting harder to find. USDA reports that spot transactions at the farmgate are averaging $34.62 per bushel for feed grade soybeans and $10.50 per bushel for feed grade yellow corn. One of the main factors influencing the price is the slowdown in imports caused by the Indian Agricultural and Processed Food Products Export Development Authority (APEDA). In October 2021 they barred four organic certifying agencies from registering any new processors or exporters of organic products, while also issuing a year-long suspension of OneCert International. The National Organic Program (NOP) is requiring all Indian operations recertify through an NOP recognized organization by July 12, 2022 if they wish to continue selling organic productions in the United States.

The Jacobsen reports that prices on the west coast for Chinese-origin organic soybean meals are quoted near $1,500 per short ton. U.S. domestic is offered between $1,550 to $1,700 per short ton. Organic soybean meal will continue to make its way down from Canada to the east coast of the United States, but the volumes will be a fraction of what arrived from India over the last few years. Mercaris notes the APEDA announcement followed a decision by the European Union, but has global implications. “The EU issued a blacklist to these organizations on the grounds of failing to meet regulatory standards,” says Ryan Koory, vice president of Economics for Mercaris.

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