COLUMNISTS

Pandemic, weather and world economics changing by the day

John Oncken
There is still corn to be harvested.

As of last Sunday, 55 percent of Wisconsin’s corn for grain was harvested according to the weekly NASS/DATCP crop report. That's more than three weeks ahead of last year and a week ahead of the five-year average. The moisture content of corn was reported at 20 percent. (Note: That report is near a week old and harvesting both corn and beans has continued at a rapid pace since.) The important topsoil moisture levels were rated  81 percent adequate and 10 percent surplus - good numbers for over wintering. 

Getting weighed and sampled at Gavilon Grain.

I took a local look-see drive in parts of Dane county and noted a lineup of semis and grain wagons waiting to go through the scale and sampling at Gavilon Grain in DeForest and a huge pile of shelled corn in short-term storage. An employee told me the pile, now at about 320,000 bushels, would ultimately reach 500,000 bushels in size. “It will ultimately go to the ethanol plant at Friesland,” he added. 

The pile was getting bigger by the minute as new corn was being unloaded.

All in all Wisconsin farmers are in a fairly good state of being – except for falling milk prices as summarized in a recent report: “The Wisconsin all milk price for September was $17.70 per hundred, according to the latest USDA Agricultural Prices report. That's $1.70 lower than last month's price and $2.20 below year-ago levels. The U.S. all milk price for September was $17.90, 20 cents higher than Wisconsin's price. Twenty-one of the 24 major milk producing states had a lower price when compared with August.”  Not a good trend!

Exports on the rise – a good trend

Data released Tuesday show that eight months into 2020, the value and volume of U.S. dairy exports continues to grow at a double-digit pace. Volume on a milk solids basis was up 17 percent compared to last August, putting year-to-date performance up 16 percent. Value grew by 11 percent (YTD up 14 percent).

A bright spot: Shipments to China went from virtually nothing in August 2019 (173 tons) to 5,343 tons in August 2020, making it the third largest destination for U.S. milk powder for the month. Most major product categories booked strong gains in August. The August increase capped a full year—12 straight months—of year-over-year increases in aggregate U.S. dairy export volume.

Remember a few years ago when exports peaked and dairy analysts predicted a solid market for years to come? Then the bottom dropped out of the market and dairy prices tanked. Now dairy exports are on a big upswing but let’s not get too optimistic about a forever market...the world changes fast nowadays. 

The World Ag Outlook Board is forecasting a reduction of volatility for the dairy industry, and a return to normalcy next year.

Less volatility

The World Ag Outlook Board is forecasting a reduction of volatility for the dairy industry, and a return to normalcy next year. Chair Mark Jekanowski said the dairy industry, has suffered a lot of volatility this year. It started, he noted with the large scale lock down, then some reopening of food service, food service industry closing again, and then uncertainty about schools and colleges.

“So there’s been a ton of volatility in terms of demand for many of these products,” he said. “Especially cheese and butter products that are used in the food service industry.  In our forecast, we assume that that’s going to settle down a bit in 2021 and things are going to turn around to a bit more of a normal situation suggesting stronger prices for all of these products."

My comment: His guess is no better or worse than yours, mine, any dairy farmer or the man on the street. The pandemic, weather, and world economics can change by the day (and often do). My question — What is normal?

A better way?

There are several farm organizations and individuals who continually criticize the USDA’s apportionment of funds provided under the several coronavirus payment programs that have taken place or still to come. They say “the big dairies get all the money and the small family farms get so little.” I suspect that is true because the funds are probably apportioned according to individual farm production. And the bigger farms produce more milk than the smaller ones.

How else do you apportion the emergency funds? Do they do it based on every farm getting the same amount? That would certainly start a political, governmental, farm organization and farmer controversy. Remember, a big family dairy loses more dollars than a small dairy during such times as we’ve had in the past 8 months. Any ideas that you think are better than the current system?

Is the long history of holding Farm Tech Days on a county sponsored, local farm like this one near Lake Geneva about to end? Maybe.

Farm Tech Days - a change?

The 2023 Wisconsin Farm Technology Days may be held in the Wisconsin Dells area at the Badger Steam and Gas Engine Club grounds. WFTD General Manager Matt Glewen says the show's board has approached the organization about the possibility. If the proposal comes to fruition, it would be the first non-county hosted show in the event's six-decade history.

"We have not officially signed the contract yet, but the BSGE board is very excited about the prospects of hosting Farm Tech Days," Glewen said. "They have a great site with easy access to the Interstate and many other accommodations to help the show run smoothly."  

Times do indeed change!

John F. Oncken is owner of Oncken Communications,  He can be reached at 608-837-7406 or e-mail him at jfodairy2@gmail.com