By Ed Maltby, NODPA Executive Director
The Agricultural Marketing Service (AMS) reported January and February 2023 estimated organic fluid product sales. Sales of organic fluid milk products in January 2023 were 258 million pounds, up 4.8 percent from January 2022, and in February 2023 they were 218 million pounds, down 3.1 per cent from February 2022. In January 2023, fluid organic whole milk sales of 125 million pounds were up 10.2 percent compared to a year earlier. Reduced fat milk (2%) sales were 85 million pounds, up 1.1 percent from the previous year. This increase marked the highest monthly volume of fluid organic milk sales for one month except for early 2021 where sales were skewed because of the COVID pandemic. As a reminder, the December 2022 organic fluid sales were 9% lower than December 2021, so this may be a correction of data. February 2023 organic whole milk fluid sales were 106 million pounds, up 2.2 percent from February 2022. The organic reduced-fat milk fluid sales in February 2023 were 243 million pounds, down 7.2 percent from February 2022. The average retail price for organic milk in January 2023 was $4.81 per half gallon, and in January 2022 it was $4.26.
|
Product Name |
Sales of Organic Fluid Milk |
Change from |
||
|
|
Jan-23 |
2023 Year to date |
Jan-22 |
2022 Year to date |
|
|
Million pounds |
Percent |
||
|
Organic Whole Milk |
125 |
125 |
10.2% |
10.2% |
|
Flavored Whole milk |
1 |
1 |
-60.9% |
-60.9% |
|
Organic Reduced Fat Milk (2%) |
85 |
85 |
1.1% |
1.1% |
|
Organic Low-Fat Milk (1%) |
27 |
27 |
1.3% |
1.3% |
|
Organic Fat Free Milk Skim |
13 |
13 |
-6.8% |
-6.8% |
|
Organic Flavored Fat-Reduced Milk |
7 |
7 |
8.7% |
8.7% |
|
Other Fluid Organic Milk Products |
0 |
0 |
0.0% |
0.0% |
|
Total Fat Reduced Milk |
132 |
132 |
0.9% |
0.9% |
|
Total Organic Milk Products |
258 |
258 |
4.8% |
4.8% |
|
Product Name |
Sales of Organic Fluid Milk |
Change from |
||
|
|
Feb-23 |
2023 Year to date |
Feb-22 |
Year to date |
|
|
Million pounds |
Percent |
||
|
Organic Whole Milk |
106 |
231 |
2.20% |
6.4% |
|
Flavored Whole milk |
1 |
1 |
-61.60% |
-61.20% |
|
Organic Reduced Fat Milk (2%) |
70 |
155 |
-6.10% |
-2.3% |
|
Organic Low-Fat Milk (1%) |
22 |
49 |
-8.80% |
-3.5% |
|
Organic Fat Free Milk Skim |
13 |
26 |
-20.30% |
-13.9% |
|
Organic Flavored Fat-Reduced Milk |
6 |
13 |
24.60% |
15.7% |
|
Other Fluid Organic Milk Products |
0 |
1 |
106% |
262.5% |
|
Total Fat Reduced Milk |
111 |
243 |
-7.20% |
-3.1% |
|
Total Organic Milk Products |
218 |
476 |
-3.20% |
1.00% |
The March 2023 retail surveys of selected supermarkets in 30 US cities by USDA, identifies the retail prices of half gallon of organic whole milk. The prices ranged from a low of $3.99 in multiple cities to a high of $6.49 in Pittsburgh, PA. The simple average price, $4.79, for March 2023 is lower than the previous month.
In a recent report from a livestock auction in New York, organic cull cows traded slightly below the conventional cows in March 2023. The average high price for the conventional cull cows was $1.12 per hundredweight, compared to an average high price of $0.92 per hundredweight for organic cull cows. The average price for conventional cull cows was $0.80 per hundredweight, compared to an average of $0.88 per hundredweight for organic cull cows.
Federal Milk Market Order 1, in New England, reports utilization of types of organic milk by pool plants. During February 2023, fluid organic whole milk utilization totaled 16.73 million pounds, up from 16.09 million pounds the previous year. The utilization of fluid organic reduced fat milk, 14.92 million pounds, decreased from 17.56 million pounds a year ago. In March 2023, the fluid whole milk utilization totaled 19.187 million pounds, an increase of 3.81 million pounds from March 2022, or approximately 27%. For fluid organic reduced fat milk, the 18.19 million pounds in fluid utilization in March 2023 was an increase from the 16.19 million in March 2022.
|
UTILIZATION OF ORGANIC FLUID MILK PRODUCTS AND CREAM BY POOL PLANTS IN FEDERAL MILK MARKETING ORDER 1 (Million pounds) |
||||||
|
|
Fluid retail Organic Milk 2023 |
Fluid retail Organic Milk 2022 |
Fluid retail Organic Milk 2021 |
Fluid retail Organic Milk 2020 |
Increase/Decrease of 2023 over 2022 |
Increase/Decrease of 2022 over 2021 |
|
JANUARY |
37.00 |
29.14 |
31.32 |
23.93 |
27% |
-7% |
|
FEBRUARY |
31.65 |
33.65 |
31.56 |
26.69 |
-6% |
7% |
|
MARCH |
37.37 |
31.56 |
31.87 |
27.90 |
19% |
-1% |
|
APRIL |
|
33.23 |
28.97 |
29.35 |
|
15% |
|
MAY |
|
30.49 |
29.72 |
28.25 |
|
3% |
|
JUNE |
|
31.53 |
28.41 |
26.90 |
|
11% |
|
JULY |
|
29.44 |
25.50 |
26.70 |
|
15% |
|
AUGUST |
|
32.12 |
27.18 |
24.70 |
|
18% |
|
SEPTEMBER |
|
35.00 |
30.26 |
29.70 |
|
16% |
|
OCTOBER |
|
34.83 |
29.47 |
25.78 |
|
18% |
|
NOVEMBER |
|
31.13 |
31.07 |
24.47 |
|
0.18% |
|
DECEMBER |
|
33.78 |
31.36 |
28.13 |
|
8% |
|
ANNUAL |
68.65 |
385.90 |
356.68 |
322.50 |
|
8% |
Mercaris supplies data on the average pay price for organic milk over the spot price. There was not a significant amount of trading on the Spot Market in February 2023. Processors and buyers report that organic milk is short in the Northeast.
|
U.S. Organic Dairy Prices (U.S. Dollars per CWT) |
||
|
Date |
Spot Fluid Milk Price |
Fluid Milk Pay Price |
|
Mar-22 |
$ 33.21 |
$ 28.54 |
|
Apr-22 |
$ 32.72 |
$ 29.59 |
|
May-22 |
$ 33.88 |
$ 28.77 |
|
Jun-22 |
$ 35.88 |
$ 29.05 |
|
Jul-22 |
$ 35.88 |
$ 28.37 |
|
Aug-22 |
$ 37.05 |
$ 29.66 |
|
Sep-22 |
$ 37.05 |
$ 29.66 |
|
Oct-22 |
$ 36.08 |
$ 29.66 |
|
Nov-22 |
$ 36.08 |
$ 29.66 |
|
Dec-22 |
$ 35.15 |
$ 31.60 |
|
Jan-23 |
$ 34.98 |
$ 31.60 |
|
Data from Mercarus March 2023 |
||
Update on action by USDA to provide Targeted Relief to organic dairy farm families
The details of the USDA Farm Service Agency’s (FSA) newly announced Organic Dairy Marketing Assistance Program (ODMAP), which has funding of $100 million from the Commodity Credit Corporation (CCC), have become clearer over the last few months. The program will cover 75 percent of projected 2023 marketing costs for eligible organic dairy producers - targeting small and mid-sized operations. The payments will be paid in dollars per cwt based on 2022 milk production, and FSA will be using USDA’s AMS estimated marketing dollars on a per hundredweight basis with a 5-million-pound cap. The costs will include estimates of milk haulage, check off dollars, and other deductions based on conventional data provided by the Federal Milk Marketing Order (FMMO) because there is a shortage of organic data. Since the program will be using the CCC funds, the money can only be paid for projected future marketing dollars. It cannot be used for loss of income in previous years. The initial projections are that producers will receive approximately 82 cent/cwt, but this may change slightly. The program is currently going through the approval process that all federal programs must follow. At the time of writing (4/24/2023), it is at the USDA Office of General Council (OGC) and after that will have to be approved by the Office of Information and Regulatory Affairs (OIRA), Office of Management and Budget (OMB). From there it will be published on the Federal Register with an immediate starting date. To receive the money, producers will need to visit their local FSA office with proof of organic certification and 2022 production records. The local FSA office will upload the information and verification of organic status to the FSA database, with payment following ‘quickly.’ USDA expects that the program will be available by the middle of May 2023. Organic Farmers Association (OFA) has been facilitating a weekly National Organic Dairy meeting including NODPA, WODPA, MOFGA, NOFA VT, NOFA NY and individual organic dairy farmers from the Midwest supported by regional members of Congress, to present a common approach in advocating for the program. By monitoring its progress through several meetings with the USDA, the group has made it plain that this is a relatively small amount of money for the large losses sustained by producers. While we do not expect that the payments will make the producer’s whole, we are urging USDA to immediately issue a second round that producers can instantly apply for as the program has already been through the approval process. We will be advocating that, between the two rounds of payment, we will be able to get the total payment closer to $2/cwt. Not enough but a payment that might cover a few months of winter feed. There are separate state initiatives, both Vermont, initiated by NOFA VT, and Maine, proposed by MOFGA, have had proposals before their annual budget committees for targeted relief for organic dairy producers in 2023.
In 2022, the Dairy Margin Coverage (DMC) program made payments for only two of the twelve months, but it will pay an average of $1.56/cwt for $9.50/cwt coverage for January 2023 and February milk covered at the Tier I, $9.50 level will receive an indemnity payment of $3.31. The January margin was $7.94/cwt, $1.82 lower than December’s and the February 2023 margin was $6.19. A two-month drop of $3.10/cwt in the U.S. average all-milk price, to $21.60/cwt, accounted for most of the margin drop. A rise in the soybean meal price accounted for about two-thirds of the remaining margin fall, but higher corn and premium alfalfa prices contributed lesser amounts as well. Available forecasts from the DMaP (Dairy Markets and Policy) indicate that the monthly DMC margins will remain below $9.50/cwt until September and average just below $8/cwt for this entire calendar year. For the average size organic dairy (120 cows) they would earn approximately $37,000 from DMC in 2023.
Maple Hill Creamery is actively seeking more milk and has had two pay price increases plus a promised distribution to their producers from their Climate Smart USDA grant of $20 million – ‘Growing the Supply and Market for Climate-Smart Grass-Fed Organic Dairy via Maple Hill Creamery.’ For more details on how this will work with the grants to CROPP Cooperative ($25 million) and Danone North America ($70 million) see article, Climate-Smart Commodities: Organic Milk Processors’ Grants, on the NODPA home page and in the May 2023 NODPA E-News.
Reports and anecdotes from producers report that CROPP Cooperative is looking for more milk, especially from small to mid-size dairies, but with no promise of an increase in pay price that we have been informed about.
USDA AMS reports that organic feed corn was $11.19/bushel FOB the farm in March 2023 and $10.99 in April 2023. Mercaris reports that organic whole and cracked corn imports remained below last year’s levels, despite the return of organic cracked corn imports in February. Combined U.S. imports of organic whole and cracked corn reached 191,000 MT through March of the 2022/23 marketing year, down 19% year to year. Organic feed soybean was trading at $24.59/bushel FOB the farm in March 2023 and $25.12/bushel in April 2023. Organic soybean meal is averaging $1,255 per short ton (ST) during the first quarter 2023. Total organic soybean imports through March of the 2022/23 marketing year were up 6% from the prior marketing year at 125,000 MT.
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