For the first time, the dairy industry in Western Australia has come together and set a milk production increase goal of 85 million litre over the next two years.
The target was set to meet increasing demand within the state and abroad, Dairy Australia chairman Max Roberts said.
“With an average of 41,000 people migrating west each year and the enduring strength of key Asian markets, the demand for WA’s dairy has never been stronger.”
A prospectus outlining the business case for investment in WA’s dairy industry has been distributed to potential investors, bankers and those who provide services to the industry.
A benchmarking study, conducted by Red Sky for the 2005/06 season, found Western Australia had the cheapest forage costs and the highest average milk yield per cow of Australia’s dairying regions.
According to the recent report, “U.S. Dairy Ag Focus,” U.S. dairy exports grew by 24 percent and accounted for 11 percent of total U.S. dairy production in 2007.
Exports increased 24 percent by volume and 59 percent by value over 2006 with approximately 1.4 million metric tons valued at $2.9 billion being exported in 2007. Mexico, Southeast Asia and Canada account for the three largest destinations for U.S. dairy exports in 2007 making up about 60 percent of the export market.
“If production growth continues to exceed that of domestic consumption, as is forecast for 2008, exports are going to become increasingly important to the ongoing profitability of the U.S. dairy sector,” said Rabobank Food & Agribusiness Research and Advisory Managing Director Deborah Perkins. “The share of production being exported has increased from 5 percent in 2002 to approximately 11 percent in 2007. Historically, exports have been assisted by government support, but the recent growth has been based on commercial merits.”
Since 2002, global demand for dairy products has been increasing nearly 3 percent annually compared to a production increase of less than 2 percent. This imbalance of supply and demand resulted in a drawdown of stocks. However, it wasn’t until early 2007 that stocks were depleted, and by later that year, prices had increased by up to 150 percent year-over-year depending on the product.
“The prices of all products were trading at record levels, some by a considerable margin, enabling the United States to be competitive on the world market in products such as butter, skim milk powder and whey,” said Perkins.
One of the reasons that the U.S. dairy sector has looked at increasing its dairy exports, is a surplus of milk. For the last three years, milk production has grown more than 2 percent annually, but demand has grown less than 1.5 percent. In the coming year, production is forecast to increase by at least 2 percent again — due, in part, to additional cows and increased production per cow.
“To counter the difference between supply and demand, the dairy sector should take a two-fold approach,” Perkins said. “To address weakness in domestic demand, the dairy sector should continue educating consumers that dairy is an important component of a healthy lifestyle. Additionally, in terms of exports, the industry needs to change its view from simply a convenient way to dispose of surplus to a more focused portion of business operations in order to be successful in the long term.”
The dairy industry continues to become more global, and with the help of dairy checkoff dollars, the U.S. Dairy Export Council is pursuing growth opportunities for U.S. cheese worldwide, including Asia. Brian Baxter provided us with this report featuring Jeff McNeill, USDEC – Japan Director, that says that major progress has been made increasing U.S. cheese sales in Japan.
The Chinese company, Feihe Dairy, Beijing, has been named the “Most Energetic Brand” in the “Top Ten Best Infant Formula” category at the Annual Baby and Infant Industry Ceremony.Feihe is owned by American Dairy, Inc., one of the leading producers and distributors of infant formula, milk powder and soybean and walnut products in China.
The Baby and Infant Industry Ceremony is one of the largest annual events in the industry and awards companies involved in all aspects of infant care, ranging from infant formula producers to baby food and clothing manufacturers. Participating companies are evaluated by a group of industry experts and the public, who votes on the Internet. Nominating companies go through a three-stage elimination process, and receive awards based on their achievements during the year, which include titles such as “Most Socially Responsible,” “Most Competitive,” and “Most Energetic.”
Mr. Leng You Bin, Chief Executive Officer of American Dairy, stated, “Feihe is a nationally established and trusted brand in China. The award speaks to Feihe’s growth in recent years and its potential for future growth. We expect that Chinese consumers will continue to seek our brand for quality and consistency.”
Scientists and lawmakers in New Zealand are excited about the potential of milk, saying the country is only scraping the surface of milk’s potential.
The Government’s $700 million Fast Forward investment into science and innovation, announced last month, would make research possible.
“I have no doubt that some very smart scientists will also find ways to crack milk into a myriad of elements and lay the foundations for entirely new biotech industries,” said Minister of Agriculture Jim Anderton.
Massey University’s Riddet Institute co-director Harjinder Singh agreed, and said Mr Anderton had it right on the dot.
“It’s like a gold mine, if you like.”
Mr Anderton said there were exciting business opportunities in fields that used milk as an ingredient, able to be sold for as much as $US4000 a tonne. Nutriceuticals could sell for even more, he said.
“The challenge for our industry will be to harness these opportunities, instead of just supplying the raw ingredient, while someone else takes off with the intellectual property and all the associated returns from new products.”
There’s a new milk on the production line, one to help your baby settle down for a good night’s sleep. Called Good Night Milk, it is marketed by Cow & Gate, a company based in the UK.
Suitable for bottle-fed babies from six months onwards, Cow & Gate Good Night Milk is a nutritionally tailored milk which contains a special formulation of carbohydrates to make the formula thicker than regular follow-on milk. The addition of prebiotics means that Cow & Gate Good Night Milk is gentle on baby’s tum and can be used instead of your usual follow-on formula night feed to provide a warm and satisfying end to your baby’s day.
Vreba-Hoff Dairy, located in Hudson, Michigan, has announced it will be providing kosher milk to an Israeli food distributor. The dairy will ship 9.5 million pounds (1.15 million gallons) of whole milk to a kosher processing facility in Kentucky, which will convert the milk into powder and then ship to Israel. Once there, the powder will be used in kosher products that will be distributed internationally.
“This is such a great opportunity for us and a dynamic new direction for our products,” said Peter van der Vegt, a business development advisor to Vreba-Hoff. “It is a great honor to do business with such an outstanding international distributor.”
“Kosher” refers to food products that meet the dietary requirements of Jewish law. Kosher certification guarantees that the source of the ingredient and the status of the production equipment meet certain requirements, including superior sanitation levels and on-site rabbinical supervision. The distributor has referred to the products as “super kosher” because the procedures the dairy is following far exceed kosher criteria. These products also often meet the strict dietary requirements of other religions, including Islam.
Producing kosher milk requires a significant commitment at Vreba-Hoff, which is also working hard to develop additional products for U.S. distribution and consumption for the kosher market.
The Australian processor Dairy Farmers has received an initial bid from National Foods, owned by Japanese brewer Kirin Holdings. The deal could be worth $920 million. Dairy Farmers is owned by more than 2,000 Australian dairy producers. The company manufacturers branded milk, cheese and yogurt.
A deal would mark a significant ramp-up in Kirin’s presence in Australia, just a few months after it bought National Foods, one of the country’s largest food groups, for A$2.8 billion ($2.7 billion).
Dairy Farmers, which is owned by some 2,000 Australian farmers and makes Dairy Farmers brand milk, Coon cheese and Ski yoghurt, put itself up for sale last month. It said on Friday it has seen wide interest in a potential deal, which could be worth A$800 million-A$1 billion.
Nestle has opened a new ice cream factory in the Chinese city of Guangdong. The plant is part of the company’s plan to increase its market share in China.
The 22,000-sq-m plant will see the Swiss-based food giant treble its annual ice-cream output to 64 million litres. The facility cost 250 million Yuan (US$35.6 million) and will be utilized to push Nestle’s high-end ice-cream products in China to meet the growing demand in the country, Peter Brabeck-Letmathe was reported as saying at the opening ceremony. Nestle is the world’s largest food company. Since it entered the Chinese market in the 1980s, it has opened 20 factories, employing some 13,000 workers in 17 regions.
The EU has agreed to raise milk quotas by two-percent in April to help mitigate the rising cost of milk prices.
Milk quotas were introduced across most of the bloc in the 1980s because of the so-called milk-lakes which developed when farmers were producing more than Europe could consume or export.nNow the European Commission estimates that between 2007 and 2014, there will be added demand of 8m tonnes of dairy products in EU member states alone, particularly for cheese.
Dairy producers are also keen to tap emerging markets and the Polish and Dutch governments are in favour of a bigger increase in quotas. BBC Brussels correspondent Dominic Hughes says part of the growing demand has come from India and China as a result of rising living standards and changing eating habits.
The EU hopes to abolish the quota system altogether in 2015 but is keen to adopt a “soft landing” approach so as not to harm sensitive areas of the industry. The commission says quota levels will be reviewed every year until they are abandoned.
Posted: February 29, 2008 at 10:45 pm
By News Editor
One lucky and deserving Jersey breeder from New York will be among those attending the 18th annual International Conference of the World Jersey Cattle Bureau. Robin Denniston-Keller, from Bryon, New York is among one of the recipients of the 2008 International Young Jersey Breeders Educational Travel Award (JETA) which sponsors five young farmers to attend the conference in May 2008.
The five JETA winners will each present a paper at the 18th International Conference of the World Jersey Cattle Bureau on their ‘Jerseys at home’, visiting herds in the Island of Jersey, making new friends in the international Jersey world.
Robin, with her husband Kip, have developed Den-Kel Jerseys milking 80 cows averaging 20,440 pounds of milk (9,271 litres) and have 20 home-bred bulls on test with A.I. organizations. Robin is President of the New York Jersey Cattle Club and Vice President of the Genesee County of the New York Farm Bureau.
Other region winners are:
Ruben Dario Galvis Goez, from the Antioquia, Colombia in the Latin American region, Henrik Dalgaard Christensen, from Denmark in the European region, Wikus van der Merwe, from the Republic of South Africa in the African region, Lyna Beehre, from Northland, New Zealand in the Oceania region.
Posted: February 28, 2008 at 6:36 pm
By News Editor
The Canadian Food Inspection Agencyconfirmed on Tuesday a case of BSE in a 6-year-old dairy cow from Alberta. The animal’s carcass is under CFIA control, and no part of it entered the human food or animal feed system. The age and location of the infected cow are consistent with previous cases in Canada, and this case will not affect Canada’s Controlled Risk country status, as recognized by the World Organization for Animal Health.
Posted: February 25, 2008 at 6:11 pm
By News Editor
Four Canadian dairy producers will no longer be shipping their milk into the U.S., something that they had been doing illegally, potentially disrupting trade balances.
“The milk that’s come over the border is a drop in the bucket,” said Jessica Chittenden, a spokeswoman for the state Department of Agriculture and Markets. “But it’s the principle. Here are farmers producing milk outside of the U.S. They haven’t been following the rules.”
At issue is an international trade regulation govern quotas for dairy imports between the two countries.
In May 2003, the World Trade Organization ruled that Canadian dairy farmers should participate in a quota system. U.S. officials hoped that agreement would level the playing field for American producers.
Currently, New York and Canadian officials know of only four Canadian dairy producers that are sending the milk across the border. New York is the third largest dairy producing state, behind California and Wisconsin.
But this month a Canadian court issued a restraining order against the Ontario-based dairy farmers that would restrict them from exporting the milk to the United States.
Accepting Canadian milk isn’t illegal, state officials said, but could potentially upset trade balances. And while the farmers that sent their milk stateside aren’t hurting dairy sales in New York at this point, the state wants the practice to end.
State Department of Agriculture Commissioner Patrick Hooker had complained to U.S. Trade Representative Susan Schwab late last year that the issue hadn’t been resolved after the 2003 World Trade Organization ruling.
Posted: February 12, 2008 at 6:14 pm
By News Editor
A new milk powder plant will be built in New Zealand by the dairy cooperative Fonterra. The plant will take advantage of the projected growth in the international ingredients market. Construction is expected to be finished by the end of the year.
The construction, which will be situated at the company’s Edendale site in Southland, has been commissioned in preparation for an expected surge in milk production in the South Islands by 2012, said group chief executive officer Andrew Ferrier.
“Growing the Cooperative’s core business by substantially increasing its milk supply and expanding its processing capacity is key if we are to capitalize on strong market demand for our products,” he stated. “The new dryer will manufacture regular Ultra Heat Treatment (UHT) and instant whole milk powders, and will take the site’s peak processing capacity to over 15 million litres per day.”
Fonterra said that the construction was a vital step in expanding dairy ingredient production to meet increased global demand from its customers.
Besides the production of whole, skim and butter milk powders, the site will also have sufficient capacity to produce cheddar cheese for the Japanese, Middle East and Philippines markets, Fonterra said. The company will also produce whey cheese, casein, anhydrous milk fat and whey protein concentrate at the site.
Posted: February 11, 2008 at 7:09 pm
By News Editor
The Good Humor/Breyers Wisconsin office will close during the fourth quarter of 2008. The company, owned by Unilever, will transfer or terminate the 245 employees at the location.
The company said it is integrating its ice cream business into its North American organization, with a goal of having one operating company per country. Its North American operations are based in Englewood Cliffs, N.J.
Netherlands-based Unilever Group has operations around the world.
Gold Bond Ice Cream, founded by Thomas H. Lutsey Sr. of Green Bay in 1938, was one of the forerunners of the current company. Unilever acquired the Green Bay ice cream operations in 1993.
The sale is expected to be finalized by the end of February and will include the company’s three cheese plants in Little Chute, Weyauwega and Luxemburg, company officials said Wednesday.
Trega, based in Little Chute, Wis. said it has reached an agreement to be acquired by Agropur, Canada’s largest dairy cooperative with sales of about $2.4 billion in 2007. Terms of the sale were not disclosed, but it will be Agropur’s second U.S. acquisition since 2002.
“We are increasing our presence in the United States, and this business transaction is in direct link with our development strategy,” Agropur CEO Pierre Claprood said in a news release.
There are no plans to close any of the Wisconsin operations, which combined have 320 employees. All Wisconsin employees are being offered jobs at the same pay and benefits they receive now, said Doug Simon, Trega president.
Trega, established in 1940, is the combined company of Weyauwega Milk Products, Krohn Dairy Products and Simon’s Specialty Cheese. It has about $300 million in annual sales and processes about 650 million liters of milk a year.
Trega will continue operating under its Wisconsin management, with Simon reporting to the president of Agropur’s cheese and functional products division. Trega’s products include cheddar, feta, mozzarella and provolone cheeses. The company has a retail store in Little Chute, near Appleton, that’s a tourist attraction.
Posted: February 5, 2008 at 4:59 pm
By News Editor
National Milk Producers Federation (NMPF) has become a member of the Global Dairy Platform (GDP). This association of domestic and international dairy marketing organizations is working together to bolster the image of dairy foods. GDP is focused on creating new opportunities for dairy in emerging markets, with an emphasis on shared scientific research to augment nutrition policy, a friendlier regulatory environment, and enhanced consumer demand.
Posted: January 21, 2008 at 9:53 pm
By News Editor
International Dairy Foods Association (IDFA) President and CEO Connie Tipton has announced the support of the association’s dairy processors to FDA’s announced continued moratorium on milk and food from cloned animals. Portions of the statement appear below.
“We applaud Acting Secretary of Agriculture Chuck Connor for his common sense decision to continue the moratorium on milk from cloned animals while USDA and other government agencies review the implications that the approval of this niche technology would have on trade and public health. Numerous surveys reveal that consumers are not comfortable with the idea of buying milk from cloned cows, and more time is needed for the American public to gain a better understanding of this new technology.
“U.S. dairy exports have grown significantly during the past few years, reducing the cost of government support programs. However, milk and food from cloned animals have not been approved for consumption in most countries that are importing our products. Therefore, it would be prudent to wait until all major foreign trading partners have reviewed and approved the same cloning technology in their respective countries.
“Moving too fast on this technology without a thorough and deliberative dialogue at all levels could also unintentionally lead to reduced domestic consumption of milk, a nutrient-dense food that is an excellent source of nine essential nutrients, including protein and calcium. USDA’s Dietary Guidelines for Americans recommend at least three daily servings of dairy as part of a healthy diet.
“We are reassured that the Food and Drug Administration has confirmed that there are no health or safety issues with food from cloned animals. During the moratorium, we encourage the biotechnology industry to work with consumers to help them gain a full understanding of the technology.”
The companies will invest as much as 70 million reais ($39.5 million) in the plant, according to a statement sent from Nestle’s Brazil unit. The factory will be located in Palmeira das Missoes, in the Southern state of Rio Grande do Sul, and rank among Brazil’s five biggest dairies, Vevey, Switzerland-based Nestle said. Production capacity is projected at 1 million liters a day.
Nestle intends to double annual sales in Brazil by 2011 from 11 billion reais in 2006. The investments will boost yearly production by 50 percent. Fonterra, based in Auckland, is the world’s largest exporter of dairy products.
Posted: December 27, 2007 at 5:34 pm
By News Editor
Dairy products company Grupo Lactalis Iberia, a branch of dairy firm Lactalis, has entered into an agreement with food and beverages company Kraft Foods to acquire the Mama Luise cheese brand for an undisclosed sum.
According to media reports, the deal also includes the acquisition of Kraft Foods’ manufacturing facility in Zamora, Spain, which employs approximately 90 staff. This acquisition is expected to strengthen Lactalis’s position in the Spanish cheese market.
For the first time, the dairy industry in Western Australia has come together and set a milk production increase goal of 85 million litre over the next two years.
