WEBVTT

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Welcome to the Bullvine Weekly Roundup, your

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go -to podcast for the latest and most critical

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news in the dairy and livestock industry. And

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today, we're diving into the top stories that

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have shaped the week. From shocking events in

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Lancaster County to global market shifts, we've

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got you covered. Let's get started. Our first

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story takes us to Lancaster County, Pennsylvania,

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where a series of senseless livestock shootings

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has left farmers devastated. The attacks have

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sparked an outpouring of community support and

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raised urgent questions about rural security.

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OK, so, you know, when you picture like Lancaster

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County, Pennsylvania, you probably imagine, you

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know. peaceful farms and those horse -drawn buggies

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right yeah like a slower pace of life right exactly

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like this pocket of tradition but recently a

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really unsettling story has been coming out of

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this community right like imagine waking up you

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know on a normal morning Yeah. Not to the, you

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know, sounds of a farmyard, but to like this

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shocking discovery of devastation. Wow. Like

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valuable livestock just senselessly gunned down.

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Oh my God. In like a pre -dawn attack. Yeah.

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It's the kind of news that makes you just stop

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and think. you know no matter where you live

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absolutely this is not just some local crime

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story right it really sends ripples way beyond

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lancaster county because it touches on how we

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live yeah you know like where our food comes

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from the people who produce it their hard work

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and livelihoods right and that sense of security

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we all kind of count on right in our communities

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whether they're rural or urban so in this deep

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dive we're going to unpack what happened with

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these livestock shootings we want to go beyond

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just the headlines you know and really try to

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understand like the impact and why this story

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should matter to you yeah it should and to do

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that we've been looking at you know the story

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as it's unfolded out of Lancaster County right

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and what's really striking is how much this has

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disrupted a community known for being tight -knit

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yeah like everyone supports each other that's

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really been shattered yeah what's really fascinating

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and concerning right away is this suggestion

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of coordination in these attacks Right. It wasn't

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just a single isolated act. Multiple dairy farms

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were targeted. Yeah. In those early morning hours.

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On Saturday, March 15th. Yeah, like pre -dawn.

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Right. It implies that there was a deliberate

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effort to cause widespread damage. Right. And

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to really instill fear within the farming community.

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The details, you know, that are emerging talk

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about Collarine Township. Yes. Specifically around

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like Schoolhouse Road near Georgetown Road, where

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two dairy cows were found dead around 11 a .m.

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Wow. And it was the owner who had to make that

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discovery. Oh, my gosh. And it's important to

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remember, these weren't just anonymous cows,

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right? Right. These were productive dairy animals.

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Yeah. It represents a huge financial investment

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in years of careful breeding. Precisely. The

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economic impact here is really crucial to understand.

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Right. Each of these cows isn't just an animal.

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It's a vital part of a business, a source of

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income. Yeah. You know, representing long -term

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planning and dedicated care. Right. The financial

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loss goes way beyond just the cost of the animal.

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What's truly concerning is that cascading effect.

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It's beyond the immediate loss of milk production.

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It impacts breeding lines, future herd growth,

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and even the farmer's ability to secure loans.

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This isn't just about replacing an animal. It's

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about rebuilding a core component of their business.

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And the attacks weren't limited to a cholerane

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township. The same perpetrators apparently moved

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on to Sadsbury Township along South Vintage Road,

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and they targeted more animals there. A horse

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was shot. Thankfully, it survived. But another

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cow died from its injuries. The fact that multiple

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locations were targeted and different types of

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livestock really suggests a level of planning

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and intent that's concerning. The authorities

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investigating these incidents were examining

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evidence at multiple sites in the southeastern

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part of the county. So the full scope of this

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crime spree might be even wider than we initially

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understood. But amidst all this really disheartening

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news, it's been inspiring to see how the community

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has rallied. It's that classic, you know... neighbors

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helping neighbors thing it's so vital in agricultural

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communities yeah it plays out in real time right

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this is where you see that lend a hand spirit

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yeah that's so essential to the strength of rural

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communities right it kicks into action and almost

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immediately a fundraiser was set up online right

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to help these farm families deal with the unexpected

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veterinary bills yeah and to begin that long

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process of replacing the cows they've lost. And

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it really brings home the point that we were

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making about... These animals being so much more

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than just livestock. Right. They're integral

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to the farm's entire operation and the family's

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livelihood. Replacing them is a huge undertaking.

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Right. Not just in terms of cost, but also the

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lost potential for future production. What's

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been interesting is just how quickly that support

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network kicked in. Right. It says a lot about

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the deep interconnectedness within the agricultural

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community. Yeah. You know what they say? The

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person you help out today might be the one you

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need to rely on tomorrow. There's a profound

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understanding of shared vulnerability and the

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absolute necessity of mutual support in this

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way of life. But this incident also really shows

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some of the unique security challenges that rural

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farms often face. Like so often these operations

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are located in pretty isolated areas with maybe

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minimal natural surveillance. And potentially

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less of a law enforcement presence. Right. Compared

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to more densely populated urban centers. That

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very isolation, while often. part of the appeal

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and character of rural living, does create a

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distinct set of security vulnerabilities, it

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can inadvertently make these farms easier targets

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for people with criminal intentions. Right. The

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fact that these people could move between multiple

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farm locations in the predawn hours undetected

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raises serious questions about the security measures

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in these areas. And it's prompting a lot of important

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questions for dairy producers, not just in Lancaster

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County, but all over the country. Yeah, for sure.

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Like how visible are your barns and pastures

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from public roads? Is there enough lighting?

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Yeah. Have you considered security cameras, especially

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at entry points? Right. What's your emergency

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response plan? Do your insurance policies cover

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livestock losses from criminal acts? Those are

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all incredibly critical questions to think about.

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A security specialist actually said something

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really important. Okay. Dairy operations often

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invest so much in their herds, but might overlook

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basic security measures that could cost a fraction

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of the loss of even one animal. Right. Simple

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things like lighting. Yeah. Managing who has

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access. Even inexpensive game cameras can make

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a difference. Sobering thought, isn't it? It

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is. Like no one wants to turn their farm into

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a fortress, but this really shows the need to

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address these vulnerabilities. You know, that

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peaceful rural lifestyle we cherish does come

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with risks that we maybe haven't fully appreciated

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until now. It's true. And there are some really

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practical, immediate action steps that are being

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encouraged for dairy producers. Right. And anyone

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who cares about our food supply first is to support

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those affected in Lancaster County by contributing

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to that online fundraiser. Right. Any amount

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can help these families recover. Absolutely.

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The second crucial step. Yeah. And this is something

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anyone can consider. Right. Every farm to look

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at their security. Yeah. You know, reviewing

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and enhancing security measures around livestock

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areas. And the motion activated lights, trail

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cameras, or even more comprehensive security

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systems. Has become more critical than ever.

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Right. Thirdly, vigilance within the community

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is key. Yeah. Reporting any suspicious vehicles

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or individuals to the authorities immediately.

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Right. Could prevent future incidents or help

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the investigation. The call is also going out

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to share information. Yes. You know, if you hear

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about similar incidents, make sure those are

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reported and that information is shared within

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farming networks. So we can create a broader

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awareness and maybe identify patterns that might

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otherwise go unnoticed. Finally, and this is

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especially important for anyone listening, who

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might know anything about these shootings in

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Lancaster County? Right. You're urged to contact

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the Pennsylvania State Police in Lancaster. Yeah.

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Even small pieces of information could be really

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valuable to the investigation. Beyond these immediate

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actions, this event brings up a bigger, more

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systemic question. Yeah. How are crimes that.

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target agricultural operations viewed and prosecuted

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compared to other types of property crime. This

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is a really important point to consider. These

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weren't just random acts of vandalism. They were

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calculated attacks on agricultural livelihoods.

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And there's a concern that these types of crimes

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in rural areas may not get the same attention

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from law enforcement. or carry the same penalties

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as similar crimes in urban settings. And the

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information even suggests that there have been

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similar livestock shootings in neighboring counties

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in recent years with what many felt were insufficient

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consequences. This potential disparity in how

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society values and protects farming operations

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is a serious concern. It is a concern for the

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future. What's both fascinating and troubling

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is this being described as agricultural terrorism

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right while that term itself is loaded yeah it

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shows that these acts don't just impact individual

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farmers right they threaten our whole food production

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system yeah If people can target livestock with

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a low risk of consequences, then every farm is

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more vulnerable. So as the investigation continues

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in Lancaster County, it's clear that this story

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has implications beyond that community. It does,

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for sure. It reminds us of the vulnerabilities

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in rural areas, the importance of community support,

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and the need for a conversation about how we

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value and protect those who produce our food.

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So as we wrap up this deep dive, let's go over

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some key takeaways. Okay. On Saturday, March

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15th, multiple dairy farms in Lancaster County,

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specifically in Coleraine and Sadsbury townships,

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were targeted in coordinated livestock shootings.

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Right. This resulted in the loss of valuable

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cows and a horse. And beyond the purchase price.

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Yeah. These farmers face huge financial losses.

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Potentially up to $92 ,000 per cow. Wow. When

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you consider their lifetime milk production potential.

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But in this tough situation, the community has

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shown incredible resilience. They have. By organizing

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support through that Give Sen Go fundraiser.

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Which really shows the solidarity in the agricultural

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community. Right. However, the incident also

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highlights the security vulnerabilities that

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many rural farms face. Right. Due to their isolation

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and sometimes limited law enforcement. Yeah.

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This really emphasizes the importance of proactive

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security measures. Like improved lighting and

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surveillance. Exactly. And it's a call to action

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for anyone in agriculture to be vigilant. Yeah.

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Report suspicious activity. Share information

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about similar incidents. And if you know anything

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about the Lancaster County shootings. You need

00:11:44.610 --> 00:11:46.850
to contact the authorities. Finally, this incident

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raises a really important question. Do crimes

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targeting agricultural operations get the same

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attention and consequences as other property

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crimes? Despite their potential impact on our

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food system. And the livelihoods of those who

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sustain it. Exactly. As Lancaster County farmers

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rally together, another tragedy reminds us of

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the importance of safety on the farm. Let's turn

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to Ohio, where a heartbreaking loss is teaching

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valuable lessons. Reid Hostetler's untimely death

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due to preventable equipment failure has sent

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shockwaves through the dairy community. His story

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underscores the need for stricter safety protocols

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and better awareness on farms worldwide. We've

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been talking a lot about how tight -knit the

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dairy farming world is and about relying on safety

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and how strong the community is. And that kind

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of brings us to this really sad event that happened

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with Reid Hostetler. Yeah, it was a really sad

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day for the farming community in Marshallville,

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Ohio, back on March 5th, 2025. Wow. When Reed

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passed away and he was only 31. So young. And,

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you know, this deep dive that we're going to

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have today is, you know, it's more than just

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recounting the events that happened. It's about

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understanding, you know, all the different pieces

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of this. you know, remembering Reed and what

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he did and kind of extracting some fundamental

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truths about, you know, farm safety and how these

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communities, you know, really step up and support

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one another. Absolutely. And I think, you know,

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like you were saying, it's so important to, you

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know, we're going to delve into what made Reed

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such a vital part of this community, how they

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all came together when this awful thing happened.

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And I think most importantly, we're going to

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examine what this means for safety on farms like

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this and specifically thinking about manure storage.

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Exactly. So why don't we start by getting a clearer

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picture of Reed himself? Yeah, I think the thing

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that really strikes you is that Reed was more

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than just, you know, a guy that milked cows.

00:13:42.779 --> 00:13:45.480
He was a co -owner of Eleanor Dairy Farm. Okay.

00:13:45.700 --> 00:13:48.740
And so he was really invested in every aspect

00:13:48.740 --> 00:13:51.159
of the operation. Wow. And, you know, people

00:13:51.159 --> 00:13:54.100
who knew him talked about how good he was mechanically.

00:13:54.220 --> 00:13:56.860
Like if something had an engine or gears, Reed

00:13:56.860 --> 00:13:59.960
could fix it. Oh, wow. Which on a modern farm,

00:14:00.039 --> 00:14:02.299
that's super valuable. Yeah, that's a huge asset.

00:14:02.559 --> 00:14:04.980
Yeah. And then on top of that, he also had really

00:14:04.980 --> 00:14:08.080
good business sense. Oh, wow. Which is something

00:14:08.080 --> 00:14:10.639
you really need in today's dairy industry. Absolutely.

00:14:10.879 --> 00:14:12.519
So, you know. I mean, it really, you know, like

00:14:12.519 --> 00:14:15.299
you said, it challenges that simple image of

00:14:15.299 --> 00:14:17.940
just a farmer. Right. I mean, clearly he was

00:14:17.940 --> 00:14:20.519
wearing a lot of hats and, you know, he was working

00:14:20.519 --> 00:14:22.200
the land, but it sounds like he had all these

00:14:22.200 --> 00:14:24.779
other experiences too. Yeah. You know, he hiked

00:14:24.779 --> 00:14:26.940
a big part of the Appalachian Trail. That's right.

00:14:27.370 --> 00:14:29.269
Which, you know, to do that, you have to be pretty

00:14:29.269 --> 00:14:31.389
tough and tenacious. Definitely take some grit.

00:14:31.590 --> 00:14:33.830
And he was a bull rider. That's right. Which,

00:14:33.909 --> 00:14:36.190
I mean, come on, that's pretty fearless. That's

00:14:36.190 --> 00:14:38.690
not for the faint of heart. No, it's not. No.

00:14:38.750 --> 00:14:41.110
And then, you know, also he went to Thailand

00:14:41.110 --> 00:14:43.850
to do mission work. Yeah. And that just shows,

00:14:43.929 --> 00:14:46.070
you know, how much he cared about helping other

00:14:46.070 --> 00:14:48.110
people. Yeah. He was really committed to helping

00:14:48.110 --> 00:14:51.129
others. That's for sure. Yeah. So that's just,

00:14:51.149 --> 00:14:52.730
you know, really paints a picture of somebody

00:14:52.730 --> 00:14:55.500
who lived life to the fullest. Yeah, he embraced

00:14:55.500 --> 00:14:58.000
it with passion and purpose. Yeah. You know,

00:14:58.000 --> 00:14:59.539
and that's what makes it all the more heartbreaking

00:14:59.539 --> 00:15:02.200
for his family. Yeah. You know, he leaves behind

00:15:02.200 --> 00:15:05.799
his wife, Abby, and three really young kids.

00:15:05.899 --> 00:15:08.879
Yeah. Bear, who's four, Claire, who's two. Oh,

00:15:08.879 --> 00:15:11.840
my gosh. And little Axe, who's only one. Oh,

00:15:12.019 --> 00:15:15.019
that's just heartbreaking. Yeah, it's just unimaginable,

00:15:15.039 --> 00:15:16.860
you know, the kind of void that they're facing

00:15:16.860 --> 00:15:19.620
now. It really is devastating. But, you know,

00:15:19.639 --> 00:15:21.460
one of the bright spots, and I think we saw this

00:15:21.460 --> 00:15:24.220
in the research too, is just how quickly the

00:15:24.220 --> 00:15:25.919
Marshallville community came together to support

00:15:25.919 --> 00:15:29.879
them. You know, it really shows you how strong

00:15:29.879 --> 00:15:32.200
and interconnected these farming communities

00:15:32.200 --> 00:15:34.600
are. Well, it's almost instinctive the way that

00:15:34.600 --> 00:15:37.379
they mobilized. You know, neighbors didn't wait

00:15:37.379 --> 00:15:39.639
to be asked. They just stepped in right away

00:15:39.639 --> 00:15:41.600
to make sure that, you know, things kept running.

00:15:42.240 --> 00:15:44.620
L &R dairy farm. Right. Taking care of the animals.

00:15:44.679 --> 00:15:47.320
Taking care of the animals, all the daily stuff.

00:15:47.620 --> 00:15:51.679
Wow. They organized meals for the family. And

00:15:51.679 --> 00:15:54.559
most importantly, they offered that, you know,

00:15:54.559 --> 00:15:56.700
that emotional support that's so important at

00:15:56.700 --> 00:15:59.399
a time like this. I mean, it really, it wasn't

00:15:59.399 --> 00:16:02.279
just practical help, you know, they also gave

00:16:02.279 --> 00:16:04.860
a lot of financial support too. Yeah, that's

00:16:04.860 --> 00:16:07.960
right. The GoFundMe was just incredible how generous

00:16:07.960 --> 00:16:10.879
people were. Yeah. And that really underscores,

00:16:10.879 --> 00:16:13.179
you know, that sense of shared responsibility

00:16:13.179 --> 00:16:16.259
that they have in the dairy community. You know,

00:16:16.279 --> 00:16:19.019
it reminds us that even though farming can be

00:16:19.019 --> 00:16:22.559
kind of a solitary profession, when times get

00:16:22.559 --> 00:16:25.580
tough, there's a really powerful safety net.

00:16:25.919 --> 00:16:28.100
Absolutely. You know, and it's there waiting

00:16:28.100 --> 00:16:31.379
to be activated. Yeah. And I think if we zoom

00:16:31.379 --> 00:16:34.139
out a little bit, it just speaks to what makes

00:16:34.139 --> 00:16:37.019
these agricultural communities so unique. Right.

00:16:37.220 --> 00:16:39.659
You know, it's generations of shared experience.

00:16:39.919 --> 00:16:42.620
Understanding the challenges of farm life. Yeah.

00:16:42.639 --> 00:16:45.000
The ups and downs. Yeah. And just that sense

00:16:45.000 --> 00:16:48.240
that, you know, we're all in this together. We're

00:16:48.240 --> 00:16:50.679
in this together. And when one family hurts,

00:16:50.899 --> 00:16:53.759
the whole community hurts. That's right. And

00:16:53.759 --> 00:16:56.090
that's what we see. you know, and how they respond.

00:16:56.350 --> 00:16:57.990
Yeah, it's a real demonstration of their values.

00:16:58.149 --> 00:17:01.230
Absolutely. So this tragedy has also brought

00:17:01.230 --> 00:17:02.830
up something really important that we need to

00:17:02.830 --> 00:17:05.670
talk about, you know, and that's safety on dairy

00:17:05.670 --> 00:17:08.450
farms. Right. And specifically when it comes

00:17:08.450 --> 00:17:12.109
to manure storage. Yeah, that's right. And I

00:17:12.109 --> 00:17:14.509
think the first step is just understanding the

00:17:14.509 --> 00:17:16.769
risks that are already there. You got it. Manure

00:17:16.769 --> 00:17:18.750
storage is just part of modern dairy farming,

00:17:18.849 --> 00:17:21.490
but it's really dangerous if you're not careful.

00:17:22.140 --> 00:17:24.200
Right. There are two main risks that we have

00:17:24.200 --> 00:17:26.480
to be aware of. OK, let's break those down. So

00:17:26.480 --> 00:17:29.799
the first one is these toxic gases that can form.

00:17:29.920 --> 00:17:32.200
Right. How does that happen and what makes them

00:17:32.200 --> 00:17:35.460
so dangerous? Well, when manure decomposes, it

00:17:35.460 --> 00:17:38.539
releases gases naturally. Things like hydrogen

00:17:38.539 --> 00:17:41.779
sulfide, which is super toxic. Yeah. Methane,

00:17:41.779 --> 00:17:44.700
carbon dioxide and ammonia. Wow. So it's not

00:17:44.700 --> 00:17:47.180
just one thing, it's a whole cocktail of dangerous

00:17:47.180 --> 00:17:49.420
stuff. That's right, and they can build up really

00:17:49.420 --> 00:17:52.039
quickly. Okay. Especially if you're agitating

00:17:52.039 --> 00:17:54.420
the manure. Right, like when you're mixing it?

00:17:54.519 --> 00:17:56.180
Yeah, exactly, when you're mixing it before you

00:17:56.180 --> 00:17:58.559
use it as fertilizer. So it can happen suddenly

00:17:58.559 --> 00:18:01.400
then? Yeah, because when you agitate it... all

00:18:01.400 --> 00:18:03.740
those gases get released really fast. So it's

00:18:03.740 --> 00:18:05.559
not just something that builds up slowly over

00:18:05.559 --> 00:18:07.880
time. Not necessarily, no. This could happen

00:18:07.880 --> 00:18:10.599
during regular work on the farm. Exactly. And

00:18:10.599 --> 00:18:12.680
that's why it's so important to understand how

00:18:12.680 --> 00:18:15.559
these gases work. Yeah. So we can, you know,

00:18:15.559 --> 00:18:18.099
keep everyone safe. Yeah. And, you know, I remember

00:18:18.099 --> 00:18:21.380
in the research, Dr. Thomas Sanderson from Iowa

00:18:21.380 --> 00:18:23.619
State University. Right. I know Dr. Sanderson.

00:18:23.759 --> 00:18:25.380
Yeah. He's done a lot of research on farm safety.

00:18:25.559 --> 00:18:28.079
He's the expert. And he was saying that during

00:18:28.079 --> 00:18:31.390
agitation, the hydrogen sulfide levels, can just

00:18:31.390 --> 00:18:34.470
spike. Yeah, super fast. Like really fast. Yeah,

00:18:34.549 --> 00:18:37.309
in just a few minutes. Wow, that's scary. Yeah,

00:18:37.390 --> 00:18:39.089
it's definitely something to watch out for. Yeah,

00:18:39.150 --> 00:18:40.789
so that's definitely something to be aware of.

00:18:40.869 --> 00:18:42.890
And then the other risk you mentioned was physical

00:18:42.890 --> 00:18:45.650
entrapment. Yeah, right. What's the danger there?

00:18:45.869 --> 00:18:48.509
So liquid manure, you know, it's really thick

00:18:48.509 --> 00:18:50.829
and dense. Right. Almost like a slurry. Yeah.

00:18:50.869 --> 00:18:53.089
So if you fall in, it's really hard to get out.

00:18:53.210 --> 00:18:55.490
Oh, gosh. You could drown, you could suffocate.

00:18:55.730 --> 00:18:58.170
Oh, wow. And the thick liquid can actually suck

00:18:58.170 --> 00:19:00.470
you in. So you can't even pull yourself out.

00:19:00.569 --> 00:19:02.910
Right. It makes it even harder to escape. Gosh,

00:19:02.970 --> 00:19:05.609
that's a really scary thought. Yeah. So knowing

00:19:05.609 --> 00:19:08.329
all of this, what are some things the dairy farms

00:19:08.329 --> 00:19:12.470
can do to be safer around manure storage? We

00:19:12.470 --> 00:19:14.470
got to be proactive. Yeah. The most important

00:19:14.470 --> 00:19:16.369
thing is to protect the storage areas themselves.

00:19:17.019 --> 00:19:18.980
Okay, how do you do that? So first you put up

00:19:18.980 --> 00:19:22.019
a strong fence all the way around to keep people

00:19:22.019 --> 00:19:25.420
and animals out. And then you put locks on all

00:19:25.420 --> 00:19:27.539
the gates. And then you've got to have clear

00:19:27.539 --> 00:19:31.160
warning signs at every entrance so people know

00:19:31.160 --> 00:19:34.000
it's dangerous. Right, right. And then I guess

00:19:34.000 --> 00:19:35.799
you'd also want to have something to keep the

00:19:35.799 --> 00:19:39.740
tractors and equipment away from the edge. Exactly.

00:19:39.740 --> 00:19:42.259
You need barriers to stop them from getting too

00:19:42.259 --> 00:19:44.730
close. Okay, so that makes sense. Yeah, just

00:19:44.730 --> 00:19:46.549
keeping people away in the first place. Right.

00:19:46.609 --> 00:19:48.630
Prevention is key. But what about, you know,

00:19:48.630 --> 00:19:51.890
using technology or something to monitor the

00:19:51.890 --> 00:19:54.470
area? Are there any tools that can help? Yeah,

00:19:54.609 --> 00:19:58.869
definitely. So there are personal hydrogen sulfide

00:19:58.869 --> 00:20:01.130
monitors. Okay. They're like little devices you

00:20:01.130 --> 00:20:03.849
wear. And if the hydrogen sulfide gets too high,

00:20:03.930 --> 00:20:05.710
they'll set off an alarm. Oh, that's pretty cool.

00:20:05.869 --> 00:20:08.029
Yeah. And then ventilation is really important

00:20:08.029 --> 00:20:11.119
too. Okay. Especially in... enclosed spaces like

00:20:11.119 --> 00:20:14.660
the barns yeah exactly okay you need good airflow

00:20:14.660 --> 00:20:17.819
to keep the gases from building up right so you

00:20:17.819 --> 00:20:20.920
can use natural ventilation or you can use fans

00:20:20.920 --> 00:20:24.079
fans okay and you know with any equipment like

00:20:24.079 --> 00:20:26.619
that yeah you gotta check it regularly make sure

00:20:26.619 --> 00:20:28.619
it's working properly right right and then just

00:20:28.619 --> 00:20:32.180
having a plan you know like a set of steps For

00:20:32.180 --> 00:20:33.920
when you're doing something like agitating the

00:20:33.920 --> 00:20:36.980
manure. Exactly. You need clear procedures. Yeah.

00:20:37.099 --> 00:20:39.319
So everyone knows what to do and how to stay

00:20:39.319 --> 00:20:42.200
safe. Okay. So it's a combination of, you know,

00:20:42.200 --> 00:20:44.640
keeping people out and then using technology

00:20:44.640 --> 00:20:47.279
to warn you if something's wrong. Right. What

00:20:47.279 --> 00:20:50.079
about the actual work that you do around manure

00:20:50.079 --> 00:20:53.440
storage? Are there any specific practices that

00:20:53.440 --> 00:20:55.940
are safer? Yeah. The Farm Safety Association

00:20:55.940 --> 00:20:58.640
has some good recommendations. What do they say?

00:20:59.019 --> 00:21:01.579
Well, one of the simplest things is to always

00:21:01.579 --> 00:21:03.920
work with a buddy. Okay. That way someone can

00:21:03.920 --> 00:21:06.059
help you if something happens. Right. So you're

00:21:06.059 --> 00:21:08.319
not out there alone. Exactly. And it's really

00:21:08.319 --> 00:21:10.599
important to be able to communicate. Yeah. So

00:21:10.599 --> 00:21:14.299
use radios or hand signals. Okay. So you can

00:21:14.299 --> 00:21:16.259
let each other know if there's a problem. Right.

00:21:16.299 --> 00:21:17.980
And then I guess you'd want to have really specific

00:21:17.980 --> 00:21:20.369
instructions for. Anything you're doing with

00:21:20.369 --> 00:21:22.250
the manure. That's right. Detailed protocols

00:21:22.250 --> 00:21:25.289
for things like agitation and transfer. Okay.

00:21:25.369 --> 00:21:27.309
And those protocols need to be followed every

00:21:27.309 --> 00:21:29.630
single time. No cutting corners. No cutting corners.

00:21:29.650 --> 00:21:32.329
And always make sure there's plenty of ventilation

00:21:32.329 --> 00:21:35.170
whenever you're working with manure. Okay. And

00:21:35.170 --> 00:21:37.450
then another really basic thing. Yeah. Is to

00:21:37.450 --> 00:21:39.730
stay away from the edge of the pit when you're

00:21:39.730 --> 00:21:42.049
operating equipment. Just common sense. Exactly.

00:21:42.190 --> 00:21:44.170
Common sense, but it's easy to forget sometimes.

00:21:44.529 --> 00:21:46.390
So it sounds like a lot of it comes down to,

00:21:46.410 --> 00:21:49.619
you know, planning ahead. being really careful

00:21:49.619 --> 00:21:51.480
and following all the safety rules. Right. You

00:21:51.480 --> 00:21:53.400
got to be meticulous and you got to be aware

00:21:53.400 --> 00:21:56.099
of your surroundings. Yeah. Are there any resources

00:21:56.099 --> 00:21:59.259
out there that can help farmers, you know, put

00:21:59.259 --> 00:22:01.660
all of this into practice? Oh, yeah. There's

00:22:01.660 --> 00:22:05.220
tons of resources. You can talk to your local

00:22:05.220 --> 00:22:08.079
agricultural extension office. They can give

00:22:08.079 --> 00:22:10.880
you advice specific to your farm. Okay. And a

00:22:10.880 --> 00:22:13.049
lot of... Insurance companies actually offer

00:22:13.049 --> 00:22:15.730
free safety assessments. Oh, wow. So they'll

00:22:15.730 --> 00:22:18.009
come out to your farm and help you identify any

00:22:18.009 --> 00:22:20.230
potential hazards. Oh, that's great. Yeah, it's

00:22:20.230 --> 00:22:22.289
really helpful. And then OSHA has guidelines

00:22:22.289 --> 00:22:24.589
specifically for manure storage. That's right.

00:22:24.789 --> 00:22:26.769
Oh, okay. And there are a bunch of farm safety

00:22:26.769 --> 00:22:29.710
organizations that offer training programs and

00:22:29.710 --> 00:22:32.509
educational materials. So there's really no excuse

00:22:32.509 --> 00:22:35.569
for not knowing how to be safe. Right. The information

00:22:35.569 --> 00:22:38.380
is out there if you look for it. And that brings

00:22:38.380 --> 00:22:41.279
us back to the community aspect. It's not just

00:22:41.279 --> 00:22:44.640
about each farm doing their own thing. It's about

00:22:44.640 --> 00:22:47.140
working together. Exactly. So how can the community

00:22:47.140 --> 00:22:50.460
help with safety? Well, farmers can share information

00:22:50.460 --> 00:22:53.180
with each other. You know, if someone finds a

00:22:53.180 --> 00:22:55.500
safety measure that works really well, they can

00:22:55.500 --> 00:22:57.619
tell their neighbors about it. Right. And neighbors

00:22:57.619 --> 00:22:59.680
can check in on each other. Yeah. Especially

00:22:59.680 --> 00:23:01.519
when someone's doing something risky. Right.

00:23:01.559 --> 00:23:04.200
Like agitating manure. Yeah. To make sure everything's

00:23:04.200 --> 00:23:06.960
OK. Exactly. And some communities even pool their

00:23:06.960 --> 00:23:09.779
money together. Oh, wow. To buy expensive safety

00:23:09.779 --> 00:23:12.259
equipment. Oh, that's a great idea. Yeah. So

00:23:12.259 --> 00:23:14.559
everyone can benefit. That's really smart. And

00:23:14.559 --> 00:23:18.619
I guess just talking about safety more openly.

00:23:18.799 --> 00:23:22.349
Yeah. You know, making it. okay to ask for help.

00:23:22.430 --> 00:23:25.190
Exactly. Create a culture of safety. Yeah. And

00:23:25.190 --> 00:23:26.710
it seems like that's already happening, you know,

00:23:26.730 --> 00:23:28.430
with how they all rallied around Reed's family.

00:23:28.589 --> 00:23:30.910
Right. They really came together to support each

00:23:30.910 --> 00:23:34.529
other. So hopefully that same spirit can help

00:23:34.529 --> 00:23:36.650
prevent something like this from happening again.

00:23:36.789 --> 00:23:39.390
I hope so. Yeah. You know, it's just a reminder

00:23:39.390 --> 00:23:43.150
that farming can be dangerous. It's a tough job.

00:23:43.529 --> 00:23:45.789
Yeah. And we need to do everything we can to

00:23:45.789 --> 00:23:47.809
keep each other safe. Absolutely. And if we all

00:23:47.809 --> 00:23:51.349
work together to improve safety. We're honoring

00:23:51.349 --> 00:23:54.769
Reed's memory in a really meaningful way. Yeah,

00:23:54.849 --> 00:23:56.750
it's about protecting other families from going

00:23:56.750 --> 00:23:58.650
through the same thing. Right, it becomes a shared

00:23:58.650 --> 00:24:01.210
responsibility. Yeah, and we know the dairy community

00:24:01.210 --> 00:24:03.630
is strong. They are. So they can definitely do

00:24:03.630 --> 00:24:05.309
this. They can support each other and keep each

00:24:05.309 --> 00:24:08.470
other safe. So, you know, it's not just about

00:24:08.470 --> 00:24:11.410
remembering Reed. It's about making sure that

00:24:11.410 --> 00:24:16.170
his legacy includes a commitment to safety. Absolutely.

00:24:16.670 --> 00:24:18.430
And I think that's something that everyone in

00:24:18.430 --> 00:24:20.650
the agricultural world can get behind. I think

00:24:20.650 --> 00:24:23.829
so, too. It's just a really powerful story of

00:24:23.829 --> 00:24:26.950
community and resilience. It is. And a reminder

00:24:26.950 --> 00:24:29.470
that we all need to be looking out for each other.

00:24:29.630 --> 00:24:33.690
That's right. So, you know, I guess as we think

00:24:33.690 --> 00:24:35.829
about all of this. Yeah. The loss of reed is

00:24:35.829 --> 00:24:38.289
just a huge reminder of how strong the dairy

00:24:38.289 --> 00:24:40.549
community is. Absolutely. And how important it

00:24:40.549 --> 00:24:42.970
is to be safe. You know, especially when it comes

00:24:42.970 --> 00:24:45.769
to manure pits. Absolutely. There are real dangers

00:24:45.769 --> 00:24:47.829
there. Yeah. And we need to take them seriously.

00:24:47.910 --> 00:24:50.549
No doubt about it. So for our listeners out there.

00:24:50.690 --> 00:24:53.039
Yeah. What can you do? Think about what we've

00:24:53.039 --> 00:24:55.460
talked about today. Yeah. And think about how

00:24:55.460 --> 00:24:59.819
you can make your farm safer. Maybe talk to your

00:24:59.819 --> 00:25:01.960
neighbors about it. Yeah. You know, share some

00:25:01.960 --> 00:25:04.960
ideas and look out for each other. Yeah, absolutely.

00:25:05.299 --> 00:25:06.960
And, you know, we've mentioned some resources

00:25:06.960 --> 00:25:09.619
today, so check those out. Yeah, there's a lot

00:25:09.619 --> 00:25:12.279
of help available. And, you know, once again,

00:25:12.319 --> 00:25:14.160
we just want to send our condolences to Abby

00:25:14.160 --> 00:25:16.440
and the kids. Yeah. And the whole Marshallville

00:25:16.440 --> 00:25:19.160
community. Our hearts go out to them. From personal

00:25:19.160 --> 00:25:22.349
loss to financial vulnerability. Our next story

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shifts focus to the hidden risks revealed by

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collapsing egg prices. The egg market collapse

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has exposed financial weak points in dairy operations.

00:25:31.849 --> 00:25:35.150
This urgent analysis highlights how price volatility

00:25:35.150 --> 00:25:38.019
can impact your farm and offers strategies to

00:25:38.019 --> 00:25:40.779
safeguard against future shocks. Okay, so you've

00:25:40.779 --> 00:25:42.619
sent us some really interesting stuff this time.

00:25:42.759 --> 00:25:45.460
A lot of it seems to be about how stable are

00:25:45.460 --> 00:25:48.059
markets, really, and specifically you're asking

00:25:48.059 --> 00:25:50.680
about the dairy market. Yeah. I mean, it's no

00:25:50.680 --> 00:25:52.079
wonder, right? I mean, you're looking at what

00:25:52.079 --> 00:25:54.019
happened recently with, you know, another big

00:25:54.019 --> 00:25:56.799
part of agriculture and wondering, like, could

00:25:56.799 --> 00:25:58.940
that same kind of thing happen to dairy? Right.

00:25:59.210 --> 00:26:01.250
Exactly. So today what we really want to do is

00:26:01.250 --> 00:26:03.589
sort of like get into all this information you've

00:26:03.589 --> 00:26:05.470
sent and figure out like what are the warning

00:26:05.470 --> 00:26:07.750
signs? What are the things that could go wrong

00:26:07.750 --> 00:26:10.250
in the dairy market? And how can our listeners

00:26:10.250 --> 00:26:13.130
be, you know, prepared for those possibilities?

00:26:13.529 --> 00:26:16.549
Yeah. And I think a good place to start is with

00:26:16.549 --> 00:26:20.329
something that seems unrelated at first, but

00:26:20.329 --> 00:26:22.529
actually might be like a canary in the coal mine.

00:26:22.589 --> 00:26:25.680
Okay. The egg market. Uh -huh. Recently saw some

00:26:25.680 --> 00:26:27.559
really dramatic shifts, and those shifts could

00:26:27.559 --> 00:26:30.299
be a warning for dairy, even though they're different

00:26:30.299 --> 00:26:33.160
products. Right. But we need to understand what

00:26:33.160 --> 00:26:35.839
happened with eggs to see why it matters for

00:26:35.839 --> 00:26:37.660
dairy. Okay, so let's dive into this egg thing.

00:26:37.779 --> 00:26:40.519
What exactly went down? The numbers are pretty

00:26:40.519 --> 00:26:43.400
shocking, to be honest. Okay. Wholesale egg prices,

00:26:43.599 --> 00:26:47.380
they just completely tanked, like plummeted 48%.

00:26:47.380 --> 00:26:51.759
Oh, wow. Went from $8 .05 a dozen down to $4

00:26:51.759 --> 00:26:56.539
.15 a dozen. This wasn't a slow, gradual decline.

00:26:56.900 --> 00:27:00.140
No. This happened over just a few weeks. Wow.

00:27:00.680 --> 00:27:03.160
Late February, early March of this year. So that's

00:27:03.160 --> 00:27:05.359
a huge drop. And it happened fast, what was going

00:27:05.359 --> 00:27:07.420
on. Yeah. And I think that's the really important

00:27:07.420 --> 00:27:10.980
thing to notice here. It wasn't a gentle easing

00:27:10.980 --> 00:27:13.160
down of the market. Right. It was like, boom,

00:27:13.200 --> 00:27:16.420
sudden drop. Yeah. And what drove that was basically

00:27:16.420 --> 00:27:19.059
consumers hitting their limit. They just said

00:27:19.059 --> 00:27:20.980
no more. They just said these prices are too

00:27:20.980 --> 00:27:24.069
high. We're not buying it anymore. Right. And

00:27:24.069 --> 00:27:26.410
that's a really crucial lesson for dairy farmers

00:27:26.410 --> 00:27:28.369
to be aware of. Because it could happen to them,

00:27:28.369 --> 00:27:31.390
too. Exactly. Consumers have a lot of power when

00:27:31.390 --> 00:27:33.049
they decide they're not willing to pay a certain

00:27:33.049 --> 00:27:35.650
price anymore. OK, so for anyone out there who's

00:27:35.650 --> 00:27:38.170
thinking, you know, my business is milk and dairy

00:27:38.170 --> 00:27:41.609
products. This egg thing seems pretty irrelevant.

00:27:41.990 --> 00:27:43.890
I want to make sure we connect the dots for them.

00:27:44.009 --> 00:27:46.690
Like, why should they care about this egg market

00:27:46.690 --> 00:27:51.220
crash? Well, the thing is, eggs and dairy. They

00:27:51.220 --> 00:27:53.759
have some important similarities when it comes

00:27:53.759 --> 00:27:55.940
to how they're produced and sold. Okay. Both

00:27:55.940 --> 00:27:57.839
of them are perishable. Right. They go bad if

00:27:57.839 --> 00:27:59.980
you don't use them. Exactly. You can't just let

00:27:59.980 --> 00:28:01.480
them sit around forever. And the other thing

00:28:01.480 --> 00:28:03.859
is their production isn't easily adjustable.

00:28:04.099 --> 00:28:06.240
Right. Like you can't just turn off the milk

00:28:06.240 --> 00:28:08.519
tap or tell the chickens to stop laying so many

00:28:08.519 --> 00:28:11.500
eggs, right? Exactly. It takes time to ramp production

00:28:11.500 --> 00:28:14.940
up or down. So if demand suddenly drops, you

00:28:14.940 --> 00:28:16.880
can end up with a lot of product you can't easily

00:28:16.880 --> 00:28:18.559
get rid of. Oh, that's a good point. I hadn't

00:28:18.559 --> 00:28:20.339
thought of it like that. And remember, this egg

00:28:20.339 --> 00:28:22.880
price crash, it happened right before Easter

00:28:22.880 --> 00:28:25.519
and Passover. Those are usually times when egg

00:28:25.519 --> 00:28:27.380
demand goes up because of all the baking and

00:28:27.380 --> 00:28:30.099
cooking people do. Right. So the fact that prices

00:28:30.099 --> 00:28:32.859
still plummeted, even with those holidays coming

00:28:32.859 --> 00:28:35.779
up, it suggests that consumer price resistance,

00:28:36.039 --> 00:28:39.619
it can overpower even seasonal increases in demand.

00:28:40.039 --> 00:28:41.920
So even though, you know, there's a certain time

00:28:41.920 --> 00:28:44.059
of year when people usually buy more of something,

00:28:44.160 --> 00:28:45.579
if the price is too high, they're just going

00:28:45.579 --> 00:28:48.279
to say no. Exactly. Yeah. It's a powerful reminder.

00:28:49.480 --> 00:28:52.119
that consumer behavior can really shift quickly.

00:28:52.460 --> 00:28:56.160
Wow. Okay, so we've got this sort of like case

00:28:56.160 --> 00:28:58.559
study almost of what happened with eggs. Now

00:28:58.559 --> 00:29:01.279
let's talk specifically about dairy. Are there

00:29:01.279 --> 00:29:03.039
people out there who are looking at this and

00:29:03.039 --> 00:29:05.440
saying, hmm, this might be something we need

00:29:05.440 --> 00:29:07.559
to worry about in milk too? Yeah, absolutely.

00:29:08.259 --> 00:29:12.019
There are... dairy economists who are definitely

00:29:12.019 --> 00:29:15.200
paying attention to this egg situation and wondering

00:29:15.200 --> 00:29:17.500
if there are some parallels to dairy. Okay, like

00:29:17.500 --> 00:29:19.539
who are some of the experts we should be listening

00:29:19.539 --> 00:29:21.940
to? Well, you've got folks at places like Cornell

00:29:21.940 --> 00:29:24.720
University. They have a program called ProDairy.

00:29:24.819 --> 00:29:27.299
They're really focused on the economics of dairy

00:29:27.299 --> 00:29:29.220
farming. And then you've got the University of

00:29:29.220 --> 00:29:31.039
Wisconsin -Madison. They have their Center for

00:29:31.039 --> 00:29:34.839
Dairy Profitability. And both of these groups,

00:29:34.940 --> 00:29:36.839
they're starting to kind of sound the alarm a

00:29:36.839 --> 00:29:38.650
little bit. They're looking at what happened

00:29:38.650 --> 00:29:41.829
with eggs and they're saying, OK, are there any

00:29:41.829 --> 00:29:45.390
signs that something similar could happen with

00:29:45.390 --> 00:29:47.490
milk? And what are they finding? Well, it's not

00:29:47.490 --> 00:29:49.670
a perfect one to one comparison. You know, eggs

00:29:49.670 --> 00:29:51.450
and milk are different. Right. But there are

00:29:51.450 --> 00:29:53.670
enough similarities that I think it's worth paying

00:29:53.670 --> 00:29:55.650
attention to. OK. And, you know, I do remember

00:29:55.650 --> 00:29:59.710
reading something by a dairy economist from Wisconsin.

00:30:00.250 --> 00:30:02.450
I think his name was Dr. Mark Stevenson. Yeah,

00:30:02.490 --> 00:30:04.549
he's really well respected in the field. And

00:30:04.549 --> 00:30:07.130
he was kind of saying that. you know dairy might

00:30:07.130 --> 00:30:08.970
be a little bit different from eggs in terms

00:30:08.970 --> 00:30:11.849
of how consumers react to price changes yeah

00:30:11.849 --> 00:30:14.609
that's right he was pointing out that historically

00:30:14.609 --> 00:30:18.130
the demand for dairy products it hasn't always

00:30:18.130 --> 00:30:21.569
been as sensitive to price swings as eggs have

00:30:21.569 --> 00:30:24.470
been okay so in other words Even if milk prices

00:30:24.470 --> 00:30:26.910
go up a little bit, people don't necessarily

00:30:26.910 --> 00:30:29.450
immediately stop buying it. Like they still need

00:30:29.450 --> 00:30:31.589
their milk for their cereal and their coffee.

00:30:31.670 --> 00:30:34.109
Right, exactly. And he also highlighted that

00:30:34.109 --> 00:30:37.089
the dairy sector, it has a lot more variety in

00:30:37.089 --> 00:30:39.269
terms of products. You've got your liquid milk,

00:30:39.329 --> 00:30:41.950
of course, but you've also got cheese, yogurt,

00:30:42.190 --> 00:30:44.190
butter, ice cream, all these different things.

00:30:44.390 --> 00:30:46.670
Right. So it's not just one single product like

00:30:46.670 --> 00:30:49.609
eggs. Exactly. And that diversity in the dairy

00:30:49.609 --> 00:30:52.460
market, it could potentially help. to kind of

00:30:52.460 --> 00:30:55.140
cushion the blow if one particular category,

00:30:55.440 --> 00:30:59.180
if milk prices spike, for example, maybe people

00:30:59.180 --> 00:31:00.859
will just switch to more yogurt or something.

00:31:01.059 --> 00:31:03.619
Okay. So it's not a perfect analogy to eggs,

00:31:03.720 --> 00:31:07.380
but even with those differences, those experts

00:31:07.380 --> 00:31:10.019
are still saying, hmm, this egg thing is worth

00:31:10.019 --> 00:31:12.019
paying attention to. Yeah, absolutely. I think

00:31:12.019 --> 00:31:14.339
it's a wake -up call. Okay. It shows that consumers

00:31:14.339 --> 00:31:17.839
are not afraid to push back on prices. And when

00:31:17.839 --> 00:31:20.230
they do, the effects can be... really sudden

00:31:20.230 --> 00:31:22.809
and really dramatic. And we are starting to see

00:31:22.809 --> 00:31:25.089
some signals within the dairy market itself that

00:31:25.089 --> 00:31:27.410
maybe things aren't quite as stable as we thought

00:31:27.410 --> 00:31:29.650
they were. What kinds of signals are we talking

00:31:29.650 --> 00:31:31.930
about? Well, the USDA, they recently revised

00:31:31.930 --> 00:31:34.950
their forecast for milk prices. They actually

00:31:34.950 --> 00:31:38.670
lowered their projection from $23 .05 per hundredweight

00:31:38.670 --> 00:31:42.990
down to $22 .60. Okay, so that's not a huge drop.

00:31:43.289 --> 00:31:45.880
Not a huge drop, but it's significant. Because,

00:31:46.000 --> 00:31:47.519
you know, in the dairy industry, margins are

00:31:47.519 --> 00:31:49.680
already pretty tight. Right. Every penny counts.

00:31:49.940 --> 00:31:52.960
Exactly. And this price adjustment, it's happening

00:31:52.960 --> 00:31:54.740
at the same time that dairy farmers are facing

00:31:54.740 --> 00:31:58.259
all kinds of rising costs. Like what? Feed costs,

00:31:58.519 --> 00:32:01.660
energy costs, labor costs. All those things are

00:32:01.660 --> 00:32:05.180
going up. Right. So this kind of mirrors what

00:32:05.180 --> 00:32:07.960
was happening in the egg market before those

00:32:07.960 --> 00:32:12.299
prices crashed. Input costs were high. And then,

00:32:12.339 --> 00:32:15.519
boom, demand just fell off a cliff. So we might

00:32:15.519 --> 00:32:17.539
be seeing the same kind of setup in dairy right

00:32:17.539 --> 00:32:20.000
now. It's a possibility that we need to be aware

00:32:20.000 --> 00:32:23.559
of. Okay. And another thing that's kind of adding

00:32:23.559 --> 00:32:28.779
to the uncertainty is that the USDA, their projections

00:32:28.779 --> 00:32:31.359
for dairy product prices have been a little bit

00:32:31.359 --> 00:32:33.579
volatile lately. Like they're going up and down.

00:32:33.779 --> 00:32:35.640
Yeah. At first they were projecting increases,

00:32:35.799 --> 00:32:38.640
then they had to adjust them downwards. And all

00:32:38.640 --> 00:32:40.869
of this volatility suggests that... Maybe the

00:32:40.869 --> 00:32:43.230
market's trying to find its footing. Right. Maybe

00:32:43.230 --> 00:32:45.430
it's not sure which way it's going to go. Exactly.

00:32:45.430 --> 00:32:47.930
And that can make it really hard for dairy farmers

00:32:47.930 --> 00:32:50.869
to plan for the future. Okay. So we've got these

00:32:50.869 --> 00:32:53.670
signs that consumer demand might be softening.

00:32:53.970 --> 00:32:56.029
Maybe prices are a little bit too high. We're

00:32:56.029 --> 00:32:57.430
not really sure what's going to happen with demand.

00:32:59.180 --> 00:33:01.519
There's another big factor in all of this, right?

00:33:01.740 --> 00:33:04.920
Yeah. And that's these alternative proteins that

00:33:04.920 --> 00:33:06.680
are coming onto the market. That's right. And

00:33:06.680 --> 00:33:08.700
the timeline for those alternatives becoming

00:33:08.700 --> 00:33:11.500
really competitive, it's sped up quite a bit.

00:33:11.619 --> 00:33:13.940
Oh, really? Like how soon are we talking? Well,

00:33:13.980 --> 00:33:16.440
the projections are showing that plant -based

00:33:16.440 --> 00:33:19.980
alternatives, you know, those are already out

00:33:19.980 --> 00:33:21.819
there. They're already pretty popular. Yeah.

00:33:21.900 --> 00:33:24.839
And they're either already at price parity with

00:33:24.839 --> 00:33:27.059
traditional animal products or they're about

00:33:27.059 --> 00:33:29.759
to be. Wow. And then you've got proteins that

00:33:29.759 --> 00:33:32.420
are made from microorganisms like fungi and yeast.

00:33:32.640 --> 00:33:35.400
Okay. Those are actually expected to hit price

00:33:35.400 --> 00:33:37.920
parity as early as this year. This year. Wow.

00:33:38.240 --> 00:33:41.180
Yeah. And then even further out, you've got these

00:33:41.180 --> 00:33:42.900
cultured proteins, you know, the ones that are

00:33:42.900 --> 00:33:44.960
grown in a lab. Right. These are called lab -grown

00:33:44.960 --> 00:33:47.380
meat and stuff. Exactly. And those are projected

00:33:47.380 --> 00:33:49.740
to be cost competitive within the next decade.

00:33:49.900 --> 00:33:52.279
So that's not that far off. No, it's not. And

00:33:52.279 --> 00:33:54.019
that must be pretty concerning for the dairy

00:33:54.019 --> 00:33:56.650
industry. It is. I think it's something that

00:33:56.650 --> 00:33:59.589
they need to be taking very seriously because

00:33:59.589 --> 00:34:04.630
it means that relying on just being cheaper than

00:34:04.630 --> 00:34:07.670
the alternatives, that's not going to be enough

00:34:07.670 --> 00:34:09.650
anymore. Especially if consumers are already

00:34:09.650 --> 00:34:11.610
starting to push back on prices anyway, right?

00:34:11.650 --> 00:34:14.019
Exactly. You've got this kind of... Perfect storm

00:34:14.019 --> 00:34:16.300
brewing. You've got consumers who are becoming

00:34:16.300 --> 00:34:19.019
more price sensitive and you've got these alternatives

00:34:19.019 --> 00:34:21.139
that are becoming more affordable and more appealing.

00:34:21.360 --> 00:34:24.019
Right. And so if dairy prices stay high and these

00:34:24.019 --> 00:34:26.199
alternatives are cheaper, well, people are just

00:34:26.199 --> 00:34:28.579
going to switch over. That's the risk. And once

00:34:28.579 --> 00:34:31.900
those consumers make that switch, they might

00:34:31.900 --> 00:34:33.679
not come back. Right. They might just decide

00:34:33.679 --> 00:34:35.599
that, you know, the alternative is good enough

00:34:35.599 --> 00:34:37.860
and it's cheaper. So why bother going back to

00:34:37.860 --> 00:34:40.380
the traditional dairy? Exactly. And one of the

00:34:40.380 --> 00:34:43.000
things that's really changing the game. with

00:34:43.000 --> 00:34:45.440
these alternatives is this technology called

00:34:45.440 --> 00:34:47.440
precision fermentation. Precision fermentation,

00:34:47.579 --> 00:34:49.699
what's that? So it's kind of like brewing, but

00:34:49.699 --> 00:34:52.239
instead of brewing beer, you're brewing specific

00:34:52.239 --> 00:34:54.940
proteins. Like milk proteins. Yeah, exactly.

00:34:55.380 --> 00:34:58.320
They can use this process to create things like

00:34:58.320 --> 00:35:01.260
beta -lactoglobulin. Beta -lactoglobulin. That's

00:35:01.260 --> 00:35:03.159
one of the main proteins in whey. Oh, okay. And

00:35:03.159 --> 00:35:04.940
they can also make different types of casein.

00:35:05.190 --> 00:35:07.050
Right. Those are the proteins in milk. Right.

00:35:07.110 --> 00:35:09.429
And the key here is that these proteins that

00:35:09.429 --> 00:35:11.630
they're making through fermentation, they're

00:35:11.630 --> 00:35:14.070
not just similar to the ones in cow's milk. They're

00:35:14.070 --> 00:35:16.550
identical. Wow. So it's not like a plant -based

00:35:16.550 --> 00:35:18.610
milk that's trying to taste kind of like milk.

00:35:19.329 --> 00:35:21.650
This is actually the same stuff. Exactly. It's

00:35:21.650 --> 00:35:24.550
molecularly identical. Okay. So does that mean

00:35:24.550 --> 00:35:27.110
that, you know, the argument that traditional

00:35:27.110 --> 00:35:29.010
milk has all these unique nutritional things

00:35:29.010 --> 00:35:31.030
that you can't get anywhere else, that's not

00:35:31.030 --> 00:35:32.969
true anymore. Well, it's getting more complicated.

00:35:33.210 --> 00:35:37.210
Okay. It's true that traditional milk has a really

00:35:37.210 --> 00:35:41.210
complex nutritional profile with a lot of different

00:35:41.210 --> 00:35:43.369
components that we're still learning about. Right.

00:35:43.510 --> 00:35:46.570
And those might be harder to replicate exactly

00:35:46.570 --> 00:35:49.889
through fermentation or other methods. Okay.

00:35:49.989 --> 00:35:51.789
But for a lot of people, the main thing they

00:35:51.789 --> 00:35:54.429
care about is the protein content. Sure. And

00:35:54.429 --> 00:35:57.150
if they can get that same protein from a source

00:35:57.150 --> 00:36:00.690
that doesn't involve cows and it's cheaper, well,

00:36:00.750 --> 00:36:03.119
that's a pretty compelling argument. Okay, so

00:36:03.119 --> 00:36:05.019
this is a lot for dairy farmers to think about.

00:36:05.079 --> 00:36:07.340
Yeah, it's a lot to digest. And I'm wondering,

00:36:07.500 --> 00:36:10.880
you know, are some parts of the country more

00:36:10.880 --> 00:36:13.219
vulnerable to these pressures than others? Yeah,

00:36:13.239 --> 00:36:15.119
definitely. And there's actually a tool that's

00:36:15.119 --> 00:36:17.639
been developed to assess this. It's called the

00:36:17.639 --> 00:36:20.769
U .S. Regional Vulnerability Index. The U .S.

00:36:20.789 --> 00:36:22.889
Regional Vulnerability Index. Okay. And it looks

00:36:22.889 --> 00:36:25.530
at different factors like consumer behavior in

00:36:25.530 --> 00:36:27.650
different parts of the country and how much competition

00:36:27.650 --> 00:36:29.690
there is from alternative proteins and things

00:36:29.690 --> 00:36:32.349
like that. Okay. And what it shows is that California,

00:36:32.570 --> 00:36:34.710
it's actually facing the highest vulnerability

00:36:34.710 --> 00:36:37.349
right now. Really? California? Yeah, they have

00:36:37.349 --> 00:36:40.150
a score of 4 .6 out of 5 on this index. Wow,

00:36:40.289 --> 00:36:43.030
so that's pretty high. Why is California so vulnerable?

00:36:43.570 --> 00:36:46.409
Well... It's probably a combination of things.

00:36:46.610 --> 00:36:49.289
You know, California tends to have higher concentrations

00:36:49.289 --> 00:36:51.869
of people who are already maybe a little bit

00:36:51.869 --> 00:36:54.309
more price sensitive. Okay. They're also more

00:36:54.309 --> 00:36:57.530
likely to be aware of and have access to these

00:36:57.530 --> 00:37:00.010
alternative protein options. Right. So it's kind

00:37:00.010 --> 00:37:02.070
of like the perfect storm for dairy vulnerability.

00:37:02.630 --> 00:37:04.889
Hmm. On the other end of the spectrum, who's

00:37:04.889 --> 00:37:06.750
doing the best? On the other end of the spectrum,

00:37:06.849 --> 00:37:08.869
you've got the upper Midwest. Okay. They have

00:37:08.869 --> 00:37:10.889
the lowest vulnerability score, three out of

00:37:10.889 --> 00:37:13.489
five. So they're doing pretty well. Why is that?

00:37:13.980 --> 00:37:17.679
Well, probably because dairy is such a big part

00:37:17.679 --> 00:37:19.719
of the culture there. Right. People have been

00:37:19.719 --> 00:37:22.159
drinking milk and eating cheese for generations,

00:37:22.280 --> 00:37:24.900
and they might be a little bit less likely to

00:37:24.900 --> 00:37:27.860
switch to alternatives. Okay, so you've got California

00:37:27.860 --> 00:37:31.019
at one end, the upper Midwest at the other. What

00:37:31.019 --> 00:37:33.199
about the retail country? Yeah, so the Northeast

00:37:33.199 --> 00:37:35.719
scores pretty high on this vulnerability index,

00:37:36.000 --> 00:37:40.079
4 .3 out of 5. Wow. And then the Southeast is

00:37:40.079 --> 00:37:43.039
kind of in the middle, 3 .6. The southwest is

00:37:43.039 --> 00:37:45.260
a little bit higher at 4 .1. Right. And then

00:37:45.260 --> 00:37:47.079
Wisconsin, which you might think would be really

00:37:47.079 --> 00:37:50.239
low, given how much dairy they produce. Right.

00:37:50.300 --> 00:37:51.820
They're actually a little bit higher than the

00:37:51.820 --> 00:37:55.219
upper Midwest overall. They're at the 3 .1. Interesting.

00:37:55.619 --> 00:37:57.559
So, yeah, it really varies across the country.

00:37:58.000 --> 00:37:59.940
Okay. So given all this stuff we've been talking

00:37:59.940 --> 00:38:02.320
about, like what can dairy farmers actually do?

00:38:05.179 --> 00:38:08.579
It can feel like that. But the point isn't to

00:38:08.579 --> 00:38:11.420
scare people. It's to give them tools to be prepared.

00:38:11.719 --> 00:38:14.199
Okay, good. And there are things that dairy farmers

00:38:14.199 --> 00:38:16.539
can do to protect themselves and their businesses.

00:38:16.800 --> 00:38:18.119
Okay, good. I was hoping you were going to say

00:38:18.119 --> 00:38:20.119
that. So there are four main strategies that

00:38:20.119 --> 00:38:21.739
I want to talk about. Okay, let's hear them.

00:38:21.960 --> 00:38:25.199
The first one is what I call setting up a price

00:38:25.199 --> 00:38:28.440
sensitivity detection system. A price sensitivity

00:38:28.440 --> 00:38:31.380
detection system. What is that? It basically

00:38:31.380 --> 00:38:34.780
means that you need to actively figure out where

00:38:34.780 --> 00:38:37.480
that breaking point is for your consumers. OK,

00:38:37.519 --> 00:38:39.599
so like how much are they willing to pay before

00:38:39.599 --> 00:38:43.300
they say no more? Yeah, exactly. And this applies

00:38:43.300 --> 00:38:45.719
whether you're selling your products directly

00:38:45.719 --> 00:38:47.840
to consumers or if you're going through wholesale

00:38:47.840 --> 00:38:52.780
channels. OK. The key is to not just assume that

00:38:52.780 --> 00:38:55.159
you know what your customers are willing to pay.

00:38:55.840 --> 00:39:00.099
You need to actually test it and find out. So

00:39:00.099 --> 00:39:02.039
how would a dairy farm actually do that? Like,

00:39:02.079 --> 00:39:03.699
are they supposed to be doing market research

00:39:03.699 --> 00:39:06.619
surveys and all that stuff? Well, for farms that

00:39:06.619 --> 00:39:10.059
sell directly to consumers, it can be as simple

00:39:10.059 --> 00:39:12.179
as trying out different prices for their products.

00:39:12.340 --> 00:39:14.519
Like maybe they run a special for a week and

00:39:14.519 --> 00:39:17.219
see how sales respond. Or maybe they raise the

00:39:17.219 --> 00:39:19.119
price a little bit and see if people stop buying.

00:39:19.500 --> 00:39:21.119
They could also just talk to their customers,

00:39:21.340 --> 00:39:23.820
get feedback, ask them what they think about

00:39:23.820 --> 00:39:25.320
the prices. Right, just have a conversation.

00:39:25.739 --> 00:39:28.059
Exactly. For farms that sell through wholesale

00:39:28.059 --> 00:39:30.900
markets, it's more about... Staying in close

00:39:30.900 --> 00:39:34.400
contact with their processors. Get data on what's

00:39:34.400 --> 00:39:36.139
selling at retail at different price points.

00:39:36.500 --> 00:39:40.079
See how sales fluctuate when prices change seasonally.

00:39:40.139 --> 00:39:42.699
And keep an eye on what's happening with those

00:39:42.699 --> 00:39:45.000
alternative products in their markets. And the

00:39:45.000 --> 00:39:46.659
interesting thing is that research has shown

00:39:46.659 --> 00:39:50.539
that farms that actually do this, that actively

00:39:50.539 --> 00:39:53.780
monitor and respond to price sensitivity, they

00:39:53.780 --> 00:39:56.239
tend to do better financially. So there's a real

00:39:56.239 --> 00:39:58.440
payoff to paying attention to those price signals.

00:39:59.000 --> 00:40:01.559
Exactly. And it's not just about reacting after

00:40:01.559 --> 00:40:04.079
the fact. It's about being proactive and anticipating

00:40:04.079 --> 00:40:06.420
those changes. Okay. So that's the first strategy.

00:40:06.539 --> 00:40:08.920
What's the second one? The second strategy is

00:40:08.920 --> 00:40:11.199
product diversification. Product diversification.

00:40:11.460 --> 00:40:14.679
Okay. But I don't just mean making five different

00:40:14.679 --> 00:40:17.000
kinds of cheddar cheese. Okay. This is about

00:40:17.000 --> 00:40:18.860
thinking about diversification in two different

00:40:18.860 --> 00:40:22.340
ways. Okay. The first way is what I call processing

00:40:22.340 --> 00:40:24.739
depth. Processing depth. So this is about moving

00:40:24.739 --> 00:40:28.449
beyond just selling raw milk. You know, raw milk

00:40:28.449 --> 00:40:31.170
that's like the most basic level, primary level

00:40:31.170 --> 00:40:33.789
of dairy production. Okay. But you can go further

00:40:33.789 --> 00:40:36.389
than that. You can start doing more processing

00:40:36.389 --> 00:40:38.590
on the farm. Like what? Well, maybe you start

00:40:38.590 --> 00:40:41.050
making yogurt or some simple fresh cheeses. Okay.

00:40:41.190 --> 00:40:43.409
That would be the secondary level of processing.

00:40:43.630 --> 00:40:46.489
Then maybe you move into aged cheeses, specialty

00:40:46.489 --> 00:40:48.510
butters, that kind of thing. Okay. That's the

00:40:48.510 --> 00:40:51.170
tertiary level. And then you can even go further.

00:40:51.659 --> 00:40:54.679
and start creating these really unique, high

00:40:54.679 --> 00:40:56.900
value specialty items. Like what kinds of things

00:40:56.900 --> 00:40:58.800
are we talking about? Could be anything from

00:40:58.800 --> 00:41:02.699
really unique artisanal cheeses to flavored butters

00:41:02.699 --> 00:41:06.539
to dairy based desserts. You know, get creative.

00:41:06.699 --> 00:41:08.940
Oh, I like that. That's the quaternary level

00:41:08.940 --> 00:41:11.159
of processing. So you're basically saying that

00:41:11.159 --> 00:41:13.500
the more steps you take in the processing chain,

00:41:13.760 --> 00:41:16.960
the more diversified your products become. Exactly.

00:41:16.960 --> 00:41:19.679
And that gives you more options. If one market

00:41:19.679 --> 00:41:22.250
starts to soften. Yeah. you can shift your focus

00:41:22.250 --> 00:41:24.150
to another one. Okay, so that's processing depth.

00:41:24.289 --> 00:41:25.949
What's the other dimension of diversification?

00:41:26.369 --> 00:41:28.590
The other dimension is market channel diversity.

00:41:28.610 --> 00:41:30.590
There's a channel diversity. So instead of just

00:41:30.590 --> 00:41:33.610
relying on those big commodity wholesale markets,

00:41:33.710 --> 00:41:37.010
which can be really volatile, you can start exploring

00:41:37.010 --> 00:41:39.989
other ways to reach consumers. Like what? Well,

00:41:40.030 --> 00:41:42.170
you could set up a farm store and sell directly

00:41:42.170 --> 00:41:45.010
to people. You could sell online through your

00:41:45.010 --> 00:41:48.000
own website. Or through farmers markets, you

00:41:48.000 --> 00:41:50.219
could partner with local restaurants and cafes

00:41:50.219 --> 00:41:53.460
who are looking for high quality local ingredients.

00:41:53.739 --> 00:41:55.559
Right. Those farm to table places are really

00:41:55.559 --> 00:41:57.760
popular now. Exactly. And you could even look

00:41:57.760 --> 00:42:00.059
into exporting your products to other countries.

00:42:00.380 --> 00:42:03.440
So the basic idea is don't put all your eggs

00:42:03.440 --> 00:42:06.260
in one basket. Exactly. And research has actually

00:42:06.260 --> 00:42:09.260
shown that farms that have more diverse market

00:42:09.260 --> 00:42:12.659
channels, they tend to have much less fluctuation

00:42:12.659 --> 00:42:15.400
in their income when markets get rough. Okay.

00:42:15.420 --> 00:42:19.559
So diversify, diversify, diversify. Got it. What's

00:42:19.559 --> 00:42:22.320
the third strategy? The third strategy is to

00:42:22.320 --> 00:42:24.659
invest in technology that gives you market flexibility.

00:42:24.900 --> 00:42:27.340
Okay. Technology that gives you market flexibility.

00:42:27.559 --> 00:42:29.989
So that's different from just... you know, buying

00:42:29.989 --> 00:42:31.750
the latest and greatest equipment that's going

00:42:31.750 --> 00:42:33.550
to make you more efficient. Right. It's not just

00:42:33.550 --> 00:42:35.590
about being efficient. It's about being able

00:42:35.590 --> 00:42:38.329
to adapt quickly when the market changes. Okay.

00:42:38.389 --> 00:42:40.610
Because if you can't adjust your production or

00:42:40.610 --> 00:42:44.809
your products when consumer demand shifts, you're

00:42:44.809 --> 00:42:47.010
going to get left behind. That makes sense. And

00:42:47.010 --> 00:42:49.070
there's actually a way to kind of assess this.

00:42:49.469 --> 00:42:51.550
They call it the market volatility protection

00:42:51.550 --> 00:42:54.030
score. The market volatility protection score.

00:42:54.150 --> 00:42:55.969
Okay. Who came up with that? The Dairy Innovation

00:42:55.969 --> 00:42:58.010
Hub at the University of Wisconsin -Madison,

00:42:58.110 --> 00:43:00.010
they developed it. Okay, so how does it work?

00:43:00.349 --> 00:43:02.409
They basically look at different technologies

00:43:02.409 --> 00:43:04.670
that dairy farmers might invest in and they rate

00:43:04.670 --> 00:43:06.929
them on how well those technologies can help

00:43:06.929 --> 00:43:09.690
them adapt to market changes. Okay, so like what

00:43:09.690 --> 00:43:13.469
kinds of technologies get high scores on this

00:43:13.469 --> 00:43:16.230
market volatility protection score? Well, things

00:43:16.230 --> 00:43:19.329
like precision feeding systems. Okay. And advanced

00:43:19.329 --> 00:43:22.460
herd management software. Those tend to do really

00:43:22.460 --> 00:43:24.599
well because they give you a lot of control over

00:43:24.599 --> 00:43:27.219
your inputs and your production levels so you

00:43:27.219 --> 00:43:28.900
can make adjustments quickly if you need to.

00:43:29.000 --> 00:43:31.199
So you can respond to the market in real time.

00:43:31.480 --> 00:43:34.079
Exactly. And investing in on -farm milk processing

00:43:34.079 --> 00:43:36.239
equipment, that also gets a pretty good score

00:43:36.239 --> 00:43:38.539
because it gives you the ability to change what

00:43:38.539 --> 00:43:40.719
products you're making. Right. If demand for

00:43:40.719 --> 00:43:43.360
milk goes down, you can switch to making cheese

00:43:43.360 --> 00:43:46.760
instead. Exactly. Yeah. But things like robotic

00:43:46.760 --> 00:43:49.219
milking systems, those might be great for efficiency.

00:43:49.539 --> 00:43:51.519
Yeah. But they don't necessarily give you that

00:43:51.519 --> 00:43:53.920
same level of flexibility to quickly change your

00:43:53.920 --> 00:43:56.159
production. OK. So they might get a lower score

00:43:56.159 --> 00:43:58.599
and then things like renewable energy systems.

00:43:58.659 --> 00:44:00.280
Those are really important for sustainability

00:44:00.280 --> 00:44:02.659
and long term cost reduction. Right. But again,

00:44:02.719 --> 00:44:04.480
they might not have a huge impact on your ability

00:44:04.480 --> 00:44:08.400
to quickly adapt to market changes. So it's all

00:44:08.400 --> 00:44:10.300
about picking the right technologies for your

00:44:10.300 --> 00:44:13.719
specific. needs and goals. Exactly. And it's

00:44:13.719 --> 00:44:16.119
worth noting that there are also things that

00:44:16.119 --> 00:44:19.099
the industry as a whole can do to help stabilize

00:44:19.099 --> 00:44:21.719
the market. Okay. Like what? Well, the National

00:44:21.719 --> 00:44:23.219
Milk Producers Federation, they've been talking

00:44:23.219 --> 00:44:25.940
a lot about the importance of better market coordination

00:44:25.940 --> 00:44:28.320
and maybe some policy changes that could help

00:44:28.320 --> 00:44:31.519
smooth out those price swings. So it's not just

00:44:31.519 --> 00:44:33.460
about individual farms. It's about the whole

00:44:33.460 --> 00:44:36.980
system working together. Exactly. Okay. So we've

00:44:36.980 --> 00:44:39.019
talked about price sensitivity detection. We've

00:44:39.019 --> 00:44:41.699
talked about product diversification and we've

00:44:41.699 --> 00:44:43.980
talked about investing in flexible technology.

00:44:44.280 --> 00:44:47.000
That's three. What's the fourth strategy? The

00:44:47.000 --> 00:44:49.280
fourth strategy is about building value beyond

00:44:49.280 --> 00:44:52.760
just price. Building value beyond just price.

00:44:52.960 --> 00:44:54.760
Okay, what does that mean? It means that you

00:44:54.760 --> 00:44:57.099
need to give consumers a reason to choose your

00:44:57.099 --> 00:45:00.019
products, even if they're not the absolute cheapest

00:45:00.019 --> 00:45:02.420
option on the shelf. Okay, so how do you do that?

00:45:02.679 --> 00:45:04.800
Well, one example is focusing on consistently

00:45:04.800 --> 00:45:07.619
high quality. Okay. You know, going above and

00:45:07.619 --> 00:45:10.039
beyond the minimum standards, really making sure

00:45:10.039 --> 00:45:12.099
that your products are the best they can be.

00:45:12.179 --> 00:45:14.119
So you're building a reputation for excellence.

00:45:14.599 --> 00:45:18.619
Exactly. And where it's legally allowed, producers

00:45:18.619 --> 00:45:20.820
could work together to kind of pool their resources

00:45:20.820 --> 00:45:23.719
and market their products collectively. Okay.

00:45:23.760 --> 00:45:25.219
That's interesting. So it's like a cooperative

00:45:25.219 --> 00:45:27.739
approach. Right. And another thing is developing

00:45:27.739 --> 00:45:31.119
unique value -added products. Okay. You know,

00:45:31.139 --> 00:45:33.239
things that you can't find just... anywhere.

00:45:33.679 --> 00:45:36.260
Things that have a story behind them, a connection

00:45:36.260 --> 00:45:38.260
to your farm or your region. Right. So you're

00:45:38.260 --> 00:45:40.280
giving people something special, something they

00:45:40.280 --> 00:45:42.260
can't get from those big industrial producers.

00:45:42.539 --> 00:45:44.199
Exactly. And then you've got brand development,

00:45:44.340 --> 00:45:47.300
you know, creating a recognizable brand that

00:45:47.300 --> 00:45:50.760
people trust and that they associate with positive

00:45:50.760 --> 00:45:53.800
things like sustainability or animal welfare

00:45:53.800 --> 00:45:57.000
or supporting local farmers. Right. So it's not

00:45:57.000 --> 00:45:59.820
just milk, it's... you know, milk from a farm

00:45:59.820 --> 00:46:01.940
that I believe in and that I feel good about

00:46:01.940 --> 00:46:04.860
supporting. Exactly. And there's some good examples

00:46:04.860 --> 00:46:07.280
of this if you look at the Canadian dairy system.

00:46:07.420 --> 00:46:09.800
Oh, interesting. Okay. They've been pretty successful

00:46:09.800 --> 00:46:12.159
at building a strong brand and a sense of value

00:46:12.159 --> 00:46:14.380
around their dairy products. And they've been

00:46:14.380 --> 00:46:17.300
able to kind of weather those price storms a

00:46:17.300 --> 00:46:20.050
bit better. because of that? Yeah, I think so.

00:46:20.130 --> 00:46:22.650
And there are also some cautionary tales. You

00:46:22.650 --> 00:46:24.190
know, there are examples of dairy industries

00:46:24.190 --> 00:46:28.090
that kind of resisted innovation or got complacent

00:46:28.090 --> 00:46:29.650
because they thought they were protected and

00:46:29.650 --> 00:46:31.630
they ended up struggling. Right. So even if things

00:46:31.630 --> 00:46:33.710
seem stable right now, you can't just rest on

00:46:33.710 --> 00:46:35.889
your laurels. Exactly. You've got to be constantly

00:46:35.889 --> 00:46:37.469
looking ahead and thinking about what's next.

00:46:37.900 --> 00:46:40.340
Okay, so we've talked about four main strategies

00:46:40.340 --> 00:46:42.380
for dairy farmers to kind of protect themselves

00:46:42.380 --> 00:46:45.280
from these market pressures. Are there any other

00:46:45.280 --> 00:46:48.039
sort of like red flags, warning signs that they

00:46:48.039 --> 00:46:51.539
should be on the lookout for? Yeah, there are

00:46:51.539 --> 00:46:54.480
some specific things that can indicate that consumers

00:46:54.480 --> 00:46:57.079
are starting to hit that breaking point on price.

00:46:57.340 --> 00:47:00.079
Okay, like what? Cornell's ProDairy program,

00:47:00.380 --> 00:47:04.260
they've identified five key warning signs. Five

00:47:04.260 --> 00:47:07.510
key warning signs. Okay, I'm all ears. The first

00:47:07.510 --> 00:47:11.130
one is if you see the gap between retail prices

00:47:11.130 --> 00:47:14.130
and farm prices widening. Okay. So what that

00:47:14.130 --> 00:47:16.829
means is that processors and retailers, they're

00:47:16.829 --> 00:47:19.050
absorbing some of those price increases instead

00:47:19.050 --> 00:47:21.449
of passing them on to consumers. Okay, but that

00:47:21.449 --> 00:47:23.809
can't last forever, right? No, eventually it

00:47:23.809 --> 00:47:26.289
puts pressure back on farm gate prices because

00:47:26.289 --> 00:47:27.949
those processors and retailers, they're going

00:47:27.949 --> 00:47:29.789
to start pushing back and saying, we can't keep

00:47:29.789 --> 00:47:31.489
taking the hit on this. Right, they need to make

00:47:31.489 --> 00:47:33.949
a profit too. Exactly. So that's warning sign

00:47:33.949 --> 00:47:36.449
number one. Warning sign number two is if you

00:47:36.449 --> 00:47:39.210
see inventory levels starting to rise. Inventory

00:47:39.210 --> 00:47:41.110
levels. Okay. Like what kinds of inventory? Well,

00:47:41.150 --> 00:47:42.889
particularly things like cheese and butter. If

00:47:42.889 --> 00:47:45.250
you see those stockpiles growing and it doesn't

00:47:45.250 --> 00:47:47.750
seem to be for any seasonal reason, that's a

00:47:47.750 --> 00:47:49.710
sign that demand might be slowing down. Okay.

00:47:49.769 --> 00:47:52.250
Warning sign number three is if you see private

00:47:52.250 --> 00:47:55.739
label market share increasing. Private label

00:47:55.739 --> 00:47:57.500
market share. Okay, so that's like the store

00:47:57.500 --> 00:48:00.400
brand stuff. Exactly. And when consumers start

00:48:00.400 --> 00:48:02.440
switching from those name brand dairy products

00:48:02.440 --> 00:48:05.519
to the cheaper store brands, that's a sign that

00:48:05.519 --> 00:48:07.519
price is becoming a much bigger factor in their

00:48:07.519 --> 00:48:09.599
decisions. Okay, so they're trading down to save

00:48:09.599 --> 00:48:12.900
money. Exactly. Warning sign number four is if

00:48:12.900 --> 00:48:15.599
you see purchase frequency declining. Purchase

00:48:15.599 --> 00:48:17.519
frequency, okay. So that means that people are

00:48:17.519 --> 00:48:20.420
just buying dairy products less often. Okay.

00:48:20.829 --> 00:48:22.610
And that could be because they're trying to be

00:48:22.610 --> 00:48:25.349
more budget conscious or it could be because

00:48:25.349 --> 00:48:27.590
they're finding alternatives that they like better.

00:48:28.010 --> 00:48:30.710
Okay, so it's a sign that maybe dairy isn't as

00:48:30.710 --> 00:48:33.110
essential to their diet as it used to be. Right,

00:48:33.170 --> 00:48:35.610
exactly. And then the fifth warning sign is substitution

00:48:35.610 --> 00:48:38.469
within dairy categories. Substitution within

00:48:38.469 --> 00:48:40.150
dairy categories. Okay, so like what does that

00:48:40.150 --> 00:48:42.230
mean? It means that maybe people are switching

00:48:42.230 --> 00:48:45.789
from premium cheeses to more basic cheeses. Okay.

00:48:46.550 --> 00:48:49.219
Or... They're switching from organic milk to

00:48:49.219 --> 00:48:51.219
conventional milk. Right. So they're still buying

00:48:51.219 --> 00:48:53.460
dairy, but they're choosing the cheaper options.

00:48:53.579 --> 00:48:55.300
Exactly. And that's another sign that they're

00:48:55.300 --> 00:48:57.059
hitting that price limit. Okay. So those are

00:48:57.059 --> 00:48:59.719
five really concrete things that people can watch

00:48:59.719 --> 00:49:01.679
for. Yeah. They're all things that you could

00:49:01.679 --> 00:49:03.300
track and measure and they can give you an early

00:49:03.300 --> 00:49:05.980
warning. Yeah. That, you know, maybe some changes

00:49:05.980 --> 00:49:08.280
are coming. Okay. That's really helpful. No,

00:49:08.300 --> 00:49:10.420
you mentioned earlier a case study of a dairy

00:49:10.420 --> 00:49:13.880
farm that had done a good job of kind of diversifying

00:49:13.880 --> 00:49:16.199
and being prepared for these kinds of challenges.

00:49:16.579 --> 00:49:18.800
Yeah, Maplewood Dairy in Vermont. They're a great

00:49:18.800 --> 00:49:20.780
example. Okay, tell me about them. So they had

00:49:20.780 --> 00:49:22.440
gone through some tough times a few years ago

00:49:22.440 --> 00:49:25.820
when milk prices dropped and they realized that

00:49:25.820 --> 00:49:28.199
they needed to do something different. Okay.

00:49:28.260 --> 00:49:30.159
So they started making their own cheese on the

00:49:30.159 --> 00:49:33.340
farm. Okay. They opened up a farm store so they

00:49:33.340 --> 00:49:35.980
could sell directly to consumers. They started

00:49:35.980 --> 00:49:38.599
selling online. And they also partnered with

00:49:38.599 --> 00:49:41.719
some local food co -ops. OK, so they really diversified

00:49:41.719 --> 00:49:43.780
their market channels. Exactly. And they also

00:49:43.780 --> 00:49:45.699
really focus on their brand. OK. You know, they

00:49:45.699 --> 00:49:48.679
emphasize their pasture -raised practices, their

00:49:48.679 --> 00:49:51.539
commitment to sustainability, all those things

00:49:51.539 --> 00:49:53.199
that consumers are looking for. So they were

00:49:53.199 --> 00:49:55.559
giving people a reason to choose their products

00:49:55.559 --> 00:49:58.880
beyond just the price. Exactly. And it worked

00:49:58.880 --> 00:50:01.179
when conventional milk prices dropped again last

00:50:01.179 --> 00:50:04.349
fall. Maplewood's revenue only went down by 6%.

00:50:04.349 --> 00:50:06.550
Wow, that's pretty impressive compared to the

00:50:06.550 --> 00:50:09.250
17 % drop that a lot of other farms experienced.

00:50:09.769 --> 00:50:12.409
Yeah, it's a huge difference. And the owner of

00:50:12.409 --> 00:50:16.769
the farm, he's been really vocal about the importance

00:50:16.769 --> 00:50:19.269
of paying attention to price sensitivity and

00:50:19.269 --> 00:50:22.980
being proactive about... adapting to market changes.

00:50:23.260 --> 00:50:24.900
Okay. So that's a really encouraging example.

00:50:25.059 --> 00:50:27.000
Yeah. It shows that it can be done. Okay. So

00:50:27.000 --> 00:50:28.360
I think we've covered a lot of ground today,

00:50:28.440 --> 00:50:29.940
but I want to make sure that we leave our listeners

00:50:29.940 --> 00:50:32.880
with the key takeaways. Yeah, absolutely. So

00:50:32.880 --> 00:50:34.820
the big thing is that what happened in the egg

00:50:34.820 --> 00:50:37.179
market, that price collapse, it's not just an

00:50:37.179 --> 00:50:39.440
isolated incident. Right. It's a warning sign

00:50:39.440 --> 00:50:41.800
for the entire agricultural industry, including

00:50:41.800 --> 00:50:44.380
dairy. Exactly. And the reason it's a warning

00:50:44.380 --> 00:50:46.960
sign is because it shows how quickly consumer

00:50:46.960 --> 00:50:49.920
behavior can shift. Yeah. And when consumers...

00:50:50.460 --> 00:50:53.199
decide they're not willing to pay a certain price

00:50:53.199 --> 00:50:56.280
anymore, the effects can be really dramatic and

00:50:56.280 --> 00:50:59.119
really fast. And the dairy industry is facing

00:50:59.119 --> 00:51:01.880
this kind of double whammy right now. Yeah. On

00:51:01.880 --> 00:51:03.519
the one hand, you've got consumers who are getting

00:51:03.519 --> 00:51:05.539
more and more price sensitive. And on the other

00:51:05.539 --> 00:51:08.099
hand, you've got these alternative proteins that

00:51:08.099 --> 00:51:09.659
are getting cheaper and better all the time.

00:51:09.780 --> 00:51:12.860
And so the old playbook of just focusing on efficiency

00:51:12.860 --> 00:51:16.280
and producing as much milk as possible, as cheaply

00:51:16.280 --> 00:51:18.579
as possible, that might not be enough anymore.

00:51:19.119 --> 00:51:20.739
It's not enough. You need to be thinking about

00:51:20.739 --> 00:51:23.039
diversification. You need to be thinking about

00:51:23.039 --> 00:51:25.440
market flexibility. You need to be thinking about

00:51:25.440 --> 00:51:27.760
building a strong brand and a loyal customer

00:51:27.760 --> 00:51:29.739
base. You need to be thinking about all of those

00:51:29.739 --> 00:51:31.800
things. Yeah. You need to be proactive. You need

00:51:31.800 --> 00:51:33.860
to be adaptable. Yeah. And you need to be really

00:51:33.860 --> 00:51:35.699
in tune with what your customers want. Okay.

00:51:35.780 --> 00:51:38.119
So that's a lot to think about. It is. And for

00:51:38.119 --> 00:51:40.099
anyone listening out there, you know, we encourage

00:51:40.099 --> 00:51:42.760
you to take some time to really think about this.

00:51:42.960 --> 00:51:44.960
Yeah. Think about what's happening in your region.

00:51:45.000 --> 00:51:47.500
Think about how prepared you are for these potential

00:51:47.500 --> 00:51:49.960
changes. Look at those warning signs that we

00:51:49.960 --> 00:51:51.500
talked about. See if any of them are starting

00:51:51.500 --> 00:51:54.059
to show up in your market. And don't be afraid

00:51:54.059 --> 00:51:56.139
to reach out for help if you need it. There are

00:51:56.139 --> 00:51:58.099
resources out there. There are people who can

00:51:58.099 --> 00:52:00.679
help you navigate this. Okay, great. So we've

00:52:00.679 --> 00:52:03.440
given you a lot to digest today. We have. But

00:52:03.440 --> 00:52:05.760
hopefully it's been helpful. I hope so. While

00:52:05.760 --> 00:52:08.280
some markets struggle, others are seeing unexpected

00:52:08.280 --> 00:52:11.940
surges. Let's explore how butter prices are defying

00:52:11.940 --> 00:52:15.400
predictions. Butter prices have skyrocketed by

00:52:15.400 --> 00:52:19.150
27%, catching many off guard. as USDA forecasts

00:52:19.150 --> 00:52:22.030
remain bleak. This story unpacks the factors

00:52:22.030 --> 00:52:24.289
behind this surge and what it means for producers

00:52:24.289 --> 00:52:26.889
moving forward. Right, so we're diving into some

00:52:26.889 --> 00:52:29.469
interesting stuff in the dairy world today. Yeah,

00:52:29.489 --> 00:52:33.409
definitely. We've got this kind of strange situation

00:52:33.409 --> 00:52:36.530
on our hands. Yeah. Butter prices in Europe have

00:52:36.530 --> 00:52:39.409
absolutely exploded, like up 27 % compared to

00:52:39.409 --> 00:52:41.550
a year ago. Right. You'd think, okay, boom, dairy

00:52:41.550 --> 00:52:44.150
market must be on fire. Everyone's making money.

00:52:44.389 --> 00:52:47.190
Yeah, you would think. But then you see the USDA.

00:52:48.059 --> 00:52:50.480
you know, right here in the U .S., they're actually

00:52:50.480 --> 00:52:53.639
lowering their outlook for milk prices in 2025.

00:52:54.340 --> 00:52:57.719
Yeah, it's a real head -scratcher, isn't it?

00:52:57.840 --> 00:52:59.860
It is. So that's what we're going to unpack today.

00:53:00.099 --> 00:53:02.260
Yeah. Why are we seeing these, you know, these

00:53:02.260 --> 00:53:05.739
seemingly conflicting signals? Yeah. What's really

00:53:05.739 --> 00:53:08.340
driving this? Absolutely. And most importantly,

00:53:08.400 --> 00:53:10.119
what does it mean for, you know, anyone listening

00:53:10.119 --> 00:53:12.280
out there? Right. For their dairy operation?

00:53:12.480 --> 00:53:15.190
Absolutely, because that's... That's the real

00:53:15.190 --> 00:53:17.750
takeaway here. This isn't just about some, you

00:53:17.750 --> 00:53:20.750
know, abstract market data. This is about understanding

00:53:20.750 --> 00:53:23.510
the forces that are shaping the industry. Exactly.

00:53:23.510 --> 00:53:25.989
And ultimately what it means for your, you know,

00:53:26.030 --> 00:53:28.550
for your bottom line. Exactly. And we've got

00:53:28.550 --> 00:53:31.630
some really interesting information to dig into

00:53:31.630 --> 00:53:33.550
today. Yeah. We're going to be looking at market

00:53:33.550 --> 00:53:35.789
reports. Yeah. You know, actual price data. Right.

00:53:35.869 --> 00:53:38.849
And then we've got those USDA projections for

00:53:38.849 --> 00:53:42.230
2025. Yeah. The USDA outlook is always interesting.

00:53:42.780 --> 00:53:45.139
It is. Gives us a kind of a glimpse into, you

00:53:45.139 --> 00:53:47.179
know, what they're thinking, where they see things

00:53:47.179 --> 00:53:49.179
headed. Yeah. So let's get into it. All right,

00:53:49.179 --> 00:53:50.699
let's do it. So one of the first things that

00:53:50.699 --> 00:53:54.280
really jumps out is this real divide between

00:53:54.280 --> 00:53:58.119
the value of fat and the value of protein. Yeah,

00:53:58.159 --> 00:54:01.920
absolutely. It's stark, isn't it? It is. And,

00:54:02.000 --> 00:54:03.840
you know, the numbers coming out of Europe are

00:54:03.840 --> 00:54:06.619
pretty remarkable. Butter prices, like you said,

00:54:06.739 --> 00:54:10.860
up over 27%. Right. Cheddar curd, you know. almost

00:54:10.860 --> 00:54:14.360
19 percent higher wow mozzarella cheese almost

00:54:14.360 --> 00:54:16.940
16 percent right and this is all compared to

00:54:16.940 --> 00:54:19.679
last year but then on the flip side you've got

00:54:19.679 --> 00:54:22.199
skim milk powder right which is you know your

00:54:22.199 --> 00:54:24.539
protein side of things right only up a little

00:54:24.539 --> 00:54:27.019
over one percent yeah and in fact it even dipped

00:54:27.019 --> 00:54:29.619
a bit this past week wow so there's a clear preference

00:54:29.619 --> 00:54:33.340
for fat right now yeah it seems that way um and

00:54:33.340 --> 00:54:35.760
and you know one of the things that that we saw

00:54:35.760 --> 00:54:40.110
that really really highlighted this was this

00:54:40.110 --> 00:54:43.289
quote. Oh yeah, I remember that. It said, the

00:54:43.289 --> 00:54:45.929
days of being paid for white water are numbered.

00:54:46.349 --> 00:54:49.510
The market is screaming for fat while protein

00:54:49.510 --> 00:54:53.510
values struggle. Yeah, that's a pretty powerful

00:54:53.510 --> 00:54:56.650
statement. It is. And it really gets to the heart

00:54:56.650 --> 00:54:59.030
of this shift we're seeing. Right. The market

00:54:59.030 --> 00:55:01.869
is placing a premium on fat. Right. And if you're

00:55:01.869 --> 00:55:03.829
a dairy producer, that's something you really

00:55:03.829 --> 00:55:06.190
need to pay attention to. Yeah. So what does

00:55:06.190 --> 00:55:09.110
that mean for producers? Well, it means thinking

00:55:09.110 --> 00:55:11.969
strategically about how they can, you know, maximize

00:55:11.969 --> 00:55:14.949
the fat content in their milk. Right. We're talking

00:55:14.949 --> 00:55:16.429
about things like nutrition. Right. You know,

00:55:16.429 --> 00:55:18.389
making sure the cows are getting the right feed.

00:55:18.489 --> 00:55:20.690
Right. To optimize for fat production. Right.

00:55:20.690 --> 00:55:22.829
And even, you know, looking at genetics. Yeah.

00:55:22.849 --> 00:55:25.070
Breeding for cows that naturally produce milk

00:55:25.070 --> 00:55:27.429
with a higher fat content. It's not just about

00:55:27.429 --> 00:55:30.090
volume anymore. It's about the components. It's

00:55:30.090 --> 00:55:32.670
about producing the type of milk that the market.

00:55:33.119 --> 00:55:36.000
is demanding. Exactly. So we've got this clear

00:55:36.000 --> 00:55:38.440
signal from Europe. Yeah. Strong demand for fat.

00:55:38.619 --> 00:55:41.380
But then you've got the USDA and their outlook.

00:55:41.619 --> 00:55:43.360
Yeah. And it's almost like they're looking at

00:55:43.360 --> 00:55:45.820
a different world. Yeah. It is interesting, isn't

00:55:45.820 --> 00:55:48.320
it? It is. Because they've actually lowered their

00:55:48.320 --> 00:55:52.199
forecast for the all milk price in 2025 by a

00:55:52.199 --> 00:55:54.320
full dollar. A whole dollar. That's significant.

00:55:54.559 --> 00:55:58.300
It's now down to $21 .60 per hundred weight.

00:55:58.659 --> 00:56:01.559
Right. And that's per hundred pounds of milk.

00:56:02.039 --> 00:56:03.519
Right. Just to clarify. For anyone who's not

00:56:03.519 --> 00:56:06.219
familiar with the term. Yeah. And it's not just

00:56:06.219 --> 00:56:08.019
the price. Right. They've also lowered their

00:56:08.019 --> 00:56:11.820
production forecast slightly. Yeah. From, what,

00:56:11.880 --> 00:56:17.059
about 102 .92 million tons down to 102 .6 million

00:56:17.059 --> 00:56:18.900
tons. Right. And what's interesting is they're

00:56:18.900 --> 00:56:22.500
attributing that to a... A decrease in milk production

00:56:22.500 --> 00:56:25.550
per cow. Right. Which is kind of counterintuitive.

00:56:25.550 --> 00:56:27.909
It is because you would think with all the advancements

00:56:27.909 --> 00:56:30.429
in genetics. Yeah. And management practices.

00:56:30.570 --> 00:56:32.670
Right. You'd think we'd be getting more milk

00:56:32.670 --> 00:56:34.469
per cow. All right. So what's going on there?

00:56:34.630 --> 00:56:38.409
Well, it's hard to say for sure, but it suggests

00:56:38.409 --> 00:56:41.590
that they're anticipating some other factors.

00:56:41.630 --> 00:56:44.110
Right. That might be impacting milk yield. Like

00:56:44.110 --> 00:56:46.500
what could use be? Well, it could be things like,

00:56:46.500 --> 00:56:49.019
you know, broader economic conditions. Maybe

00:56:49.019 --> 00:56:53.380
they're seeing some signs of, you know, a slowdown

00:56:53.380 --> 00:56:56.159
in consumer spending. Right. Which could impact

00:56:56.159 --> 00:56:59.119
demand for dairy products. Yeah, makes sense.

00:56:59.320 --> 00:57:01.659
Or it could be shifts in international trade.

00:57:01.800 --> 00:57:03.820
Right. You know, maybe they're anticipating changes

00:57:03.820 --> 00:57:06.659
in import -export patterns. Right. That could

00:57:06.659 --> 00:57:08.860
affect overall milk supply. Yeah, so it's not

00:57:08.860 --> 00:57:10.800
just about what's happening on the farm. Exactly.

00:57:10.820 --> 00:57:13.639
It's about these bigger macroeconomic trends

00:57:13.639 --> 00:57:16.320
as well. Right. And, you know, the USDA is looking

00:57:16.320 --> 00:57:18.019
at all of that when they're making their forecasts.

00:57:18.300 --> 00:57:20.579
And these downward revisions aren't affecting

00:57:20.579 --> 00:57:23.519
all types of milk equally. Right. Class 3 milk,

00:57:23.679 --> 00:57:26.500
which is, you know, often used for cheese. Right.

00:57:26.639 --> 00:57:29.119
Class 4 milk, which is used for butter and milk

00:57:29.119 --> 00:57:31.639
powder. Right. Those are facing even steeper

00:57:31.639 --> 00:57:35.159
declines. Yeah. The forecast for class 3 milk

00:57:35.159 --> 00:57:40.559
is down $1 .15. Wow. To $17 .95 per hundredweight.

00:57:40.889 --> 00:57:43.389
Right. And class four milk is down 90 cents to

00:57:43.389 --> 00:57:46.250
$18 .80. Right. So that's going to be a, you

00:57:46.250 --> 00:57:48.829
know, real concern for producers whose milk goes

00:57:48.829 --> 00:57:51.329
into those categories. Absolutely. Because, you

00:57:51.329 --> 00:57:53.489
know, their profitability is directly tied to

00:57:53.489 --> 00:57:57.150
those prices. Right. And there's this warning

00:57:57.150 --> 00:57:59.090
that really stood out to me. Oh, yeah. I remember

00:57:59.090 --> 00:58:01.949
that. It said, are you basing your expansion

00:58:01.949 --> 00:58:04.949
decisions on government forecasts that change

00:58:04.949 --> 00:58:08.170
dramatically monthly? That's a dangerous game

00:58:08.170 --> 00:58:10.780
few can afford to play. Yeah, that's a sobering

00:58:10.780 --> 00:58:12.679
thought. It is. And, you know, it highlights

00:58:12.679 --> 00:58:15.300
the fact that these forecasts, while they're

00:58:15.300 --> 00:58:17.559
valuable, they are just that they're forecasts,

00:58:17.800 --> 00:58:20.320
they're predictions, and they can change as new

00:58:20.320 --> 00:58:22.980
information becomes available. And they do change.

00:58:23.239 --> 00:58:24.820
They do. So, you know, you can't just blindly

00:58:24.820 --> 00:58:26.860
rely on them. You've got to take them into account.

00:58:27.019 --> 00:58:29.559
Right. But you also need to have your own, you

00:58:29.559 --> 00:58:32.340
know, your own analysis, your own risk management

00:58:32.340 --> 00:58:35.139
strategies. Absolutely. You've got to be thinking

00:58:35.139 --> 00:58:38.460
for yourself. Right. So let's shift gears a bit.

00:58:38.679 --> 00:58:40.420
Okay. Let's talk about what's happening in Europe

00:58:40.420 --> 00:58:44.679
in terms of production. Right. Because it's interesting,

00:58:44.940 --> 00:58:47.260
isn't it? It is. Yeah. We're seeing some pretty

00:58:47.260 --> 00:58:50.420
significant decline. Right. France, their milk

00:58:50.420 --> 00:58:53.260
production is down 1 .7 % compared to last year.

00:58:53.340 --> 00:58:57.059
Right. And Germany, which is a huge player. Yeah.

00:58:57.139 --> 00:58:59.539
They're a major producer in the EU. They're down

00:58:59.539 --> 00:59:02.619
2 .2%. Yeah. Those are big drops. They are. And

00:59:02.619 --> 00:59:06.289
Germany, they account for almost a quarter. About

00:59:06.289 --> 00:59:10.010
23%. Of all EU milk production. Yeah. So that's

00:59:10.010 --> 00:59:13.050
a significant chunk. It is. So what does that

00:59:13.050 --> 00:59:15.690
mean for the European market? Well, it likely

00:59:15.690 --> 00:59:18.550
means that processors are going to be facing

00:59:18.550 --> 00:59:21.130
a more competitive environment. Right. You know,

00:59:21.130 --> 00:59:23.610
when supplies tighten, everyone's scrambling

00:59:23.610 --> 00:59:25.590
to get the milk they need. Right. And that could

00:59:25.590 --> 00:59:27.829
drive prices up. It could. But then you have

00:59:27.829 --> 00:59:29.690
Denmark. Right. They're actually seeing an increase

00:59:29.690 --> 00:59:31.510
in production. Yeah. They're up a little over

00:59:31.510 --> 00:59:34.230
1%. Right. And not only that, but their milk

00:59:34.230 --> 00:59:36.250
is really high quality. Yeah, they've got high

00:59:36.250 --> 00:59:39.329
component levels. Right, like 4 .63 % fat and

00:59:39.329 --> 00:59:43.969
3 .75 % protein. That's impressive. It is. And

00:59:43.969 --> 00:59:46.050
their milk solid collection is up too. Yeah,

00:59:46.130 --> 00:59:48.570
about 2%. So they're really focusing on quality.

00:59:48.829 --> 00:59:50.969
They are. And it seems to be paying off. Yeah,

00:59:51.010 --> 00:59:53.190
so it's not just about how much milk you produce.

00:59:53.409 --> 00:59:55.690
Right. It's also about the composition of that

00:59:55.690 --> 00:59:57.730
milk. Absolutely. The quality, the components.

00:59:57.909 --> 00:59:59.489
Right, because those components are what drive

00:59:59.489 --> 01:00:02.090
value. Exactly. Okay, so we've got these kind

01:00:02.090 --> 01:00:04.969
of contrasting trends in production. Yeah, tightening

01:00:04.969 --> 01:00:07.130
supplies in some parts of Europe. Right. And

01:00:07.130 --> 01:00:09.670
then the USDA projecting, you know, slightly

01:00:09.670 --> 01:00:12.030
lower production here in the U .S. Right. And

01:00:12.030 --> 01:00:14.110
all of this is happening against the backdrop

01:00:14.110 --> 01:00:17.469
of some pretty significant activity in the dairy

01:00:17.469 --> 01:00:20.500
futures market. It's a... It's kind of crazy

01:00:20.500 --> 01:00:22.179
right now, isn't it? It is. Yeah, we're seeing

01:00:22.179 --> 01:00:25.199
a lot of volume. Like over 16 ,000 tons traded?

01:00:25.460 --> 01:00:28.659
Yeah, on the EEX and the SGX. Right, the European

01:00:28.659 --> 01:00:31.199
and Singaporean exchanges. Right. And that's

01:00:31.199 --> 01:00:33.760
a lot. It is. And you know what they say? What's

01:00:33.760 --> 01:00:37.260
that? When futures traders get this active, they're

01:00:37.260 --> 01:00:40.340
not just hedging. Right. They're panicking. Panicking.

01:00:40.380 --> 01:00:44.539
The smart money sees something coming that average

01:00:44.539 --> 01:00:47.150
producers don't. So what does that mean? Well,

01:00:47.210 --> 01:00:49.650
it means that people who are really tuned into

01:00:49.650 --> 01:00:52.829
the market, they're anticipating some big moves.

01:00:53.110 --> 01:00:55.230
They're trying to position themselves to either

01:00:55.230 --> 01:00:57.690
capitalize on those moves or protect themselves

01:00:57.690 --> 01:01:00.469
from them. And that level of activity is unusual.

01:01:00.829 --> 01:01:03.250
Yeah, it's definitely above what we would consider

01:01:03.250 --> 01:01:05.630
normal. Right. So that's something to pay attention

01:01:05.630 --> 01:01:08.789
to. Absolutely. So with all of this going on,

01:01:08.929 --> 01:01:12.750
what are the key things that our listeners should

01:01:12.750 --> 01:01:14.900
be watching? Well, there are five indicators

01:01:14.900 --> 01:01:16.679
that are highlighted in what we've looked at.

01:01:16.760 --> 01:01:19.960
First, any revisions to the USDA's WASDE report.

01:01:20.500 --> 01:01:23.980
That's the World Agricultural Supply and Demand

01:01:23.980 --> 01:01:26.619
Estimates. It's their forward -looking projections

01:01:26.619 --> 01:01:29.559
for supply and demand. And those projections

01:01:29.559 --> 01:01:32.760
really influence the price forecasts. They do.

01:01:33.059 --> 01:01:35.599
Okay, so that's the first one. Yeah. Second,

01:01:35.699 --> 01:01:37.800
the trading volume on the futures exchanges.

01:01:38.099 --> 01:01:41.840
Right. The EEX and SGX. Right. If you see sustained

01:01:41.840 --> 01:01:46.260
weekly volume above 7500 tons. Right. That could

01:01:46.260 --> 01:01:48.980
be a sign of increased volatility. OK. Third,

01:01:49.179 --> 01:01:52.400
the fat to protein price ratio. You know, we

01:01:52.400 --> 01:01:54.539
talked about that premium for butterfat. Right.

01:01:54.639 --> 01:01:57.699
That's something to keep a close eye on. OK.

01:01:57.900 --> 01:02:00.949
Fourth. The trend in feed costs. Right. Because

01:02:00.949 --> 01:02:03.090
that can really impact your bottom line. Absolutely.

01:02:03.210 --> 01:02:05.969
Feed is a major expense for dairy producers.

01:02:06.250 --> 01:02:07.989
So that's something to monitor closely. Yeah.

01:02:08.409 --> 01:02:11.670
And finally, that somewhat puzzling forecast

01:02:11.670 --> 01:02:14.309
for milk production per cow here in the U .S.

01:02:14.309 --> 01:02:17.789
Right. Why is the USDA projecting a decline when

01:02:17.789 --> 01:02:20.269
you would expect it to be going up? It's something

01:02:20.269 --> 01:02:22.329
to keep an eye on. It is. So we've got a lot

01:02:22.329 --> 01:02:25.309
to watch. We do. It's a complex picture, isn't

01:02:25.309 --> 01:02:27.429
it? It is. You've got these strong fat values

01:02:27.429 --> 01:02:30.719
in Europe. All right. But then this weaker outlook

01:02:30.719 --> 01:02:33.500
for overall milk prices here in the U .S. Yeah,

01:02:33.619 --> 01:02:36.940
it's a bit of a mixed bag. It is. And it seems

01:02:36.940 --> 01:02:38.579
like this kind of environment is going to create

01:02:38.579 --> 01:02:41.519
some winners and some losers. Absolutely. There

01:02:41.519 --> 01:02:44.260
will be those who are well positioned to take

01:02:44.260 --> 01:02:46.980
advantage of these trends and those who may struggle.

01:02:47.219 --> 01:02:49.880
So who are the potential winners here? Well,

01:02:49.940 --> 01:02:52.400
based on what we're seeing, producers who are

01:02:52.400 --> 01:02:55.099
really focused on maximizing components, particularly

01:02:55.099 --> 01:02:57.789
butterfat. Right. They're in a good spot. Yeah.

01:02:57.849 --> 01:02:59.909
They can benefit from those high fat prices.

01:03:00.110 --> 01:03:03.110
Right. Also, European cheese manufacturers. Right.

01:03:03.170 --> 01:03:05.630
They're facing potentially tighter milk supplies.

01:03:05.949 --> 01:03:10.409
Right. But demand for cheese is strong. Right.

01:03:10.510 --> 01:03:12.929
So they could do well. Yeah. And what about producers

01:03:12.929 --> 01:03:15.150
here in the U .S.? Well, those who have been

01:03:15.150 --> 01:03:19.250
proactive about risk management, you know, using

01:03:19.250 --> 01:03:22.030
hedging strategies to protect themselves from

01:03:22.030 --> 01:03:24.489
price volatility, they're going to be in a better

01:03:24.489 --> 01:03:27.150
position than those who haven't taken those steps.

01:03:27.429 --> 01:03:29.949
Right. So being proactive is key. Absolutely.

01:03:30.150 --> 01:03:33.500
And also those who are really efficient. You

01:03:33.500 --> 01:03:35.440
know, they've got their costs under control.

01:03:35.579 --> 01:03:38.340
Right. They can withstand some downward pressure

01:03:38.340 --> 01:03:40.739
on prices. Right. Because their margins are healthier.

01:03:40.940 --> 01:03:43.159
Exactly. So what about the losers then? Well,

01:03:43.260 --> 01:03:46.519
those who are just focused on volume without

01:03:46.519 --> 01:03:49.400
paying attention to components. Right. They could

01:03:49.400 --> 01:03:51.519
find themselves in trouble. Right. Because if

01:03:51.519 --> 01:03:55.420
the price of milk is declining. Right. But you're

01:03:55.420 --> 01:03:58.179
not getting a premium for your components. Right.

01:03:58.599 --> 01:04:00.179
then your margins are going to get squeezed.

01:04:00.519 --> 01:04:03.099
Exactly. And what about those who haven't done

01:04:03.099 --> 01:04:05.280
any risk management? Yeah, those who haven't

01:04:05.280 --> 01:04:08.659
hedged. Right. They're exposed. Yeah. If those

01:04:08.659 --> 01:04:11.599
USDA forecasts are accurate. Right. And prices

01:04:11.599 --> 01:04:13.820
do come down. Right. They're going to feel the

01:04:13.820 --> 01:04:16.300
pain. They are. And also those who have high

01:04:16.300 --> 01:04:19.659
input costs. Right. Particularly for feed. Right.

01:04:19.780 --> 01:04:21.840
They're going to be more vulnerable. Yeah, because

01:04:21.840 --> 01:04:24.260
their margins are already tighter. Exactly. And

01:04:24.260 --> 01:04:27.619
finally, those who are slow to adapt. Yeah. To

01:04:27.619 --> 01:04:29.739
these changing market conditions. If you're not

01:04:29.739 --> 01:04:31.780
paying attention. Right. And you're not making

01:04:31.780 --> 01:04:33.500
adjustments. Right. You're going to fall behind.

01:04:33.699 --> 01:04:36.000
Right. So it's all about being proactive. Absolutely.

01:04:36.360 --> 01:04:38.219
Informed. Right. And adaptable. Those are the

01:04:38.219 --> 01:04:41.179
keys to success. And our sources, they lay out

01:04:41.179 --> 01:04:44.280
these five tough questions. Yeah. That every

01:04:44.280 --> 01:04:46.980
dairy producer should be asking themselves right

01:04:46.980 --> 01:04:49.119
now. These are really important questions. They

01:04:49.119 --> 01:04:51.079
are. So let's go through them. All right. First,

01:04:51.219 --> 01:04:54.599
given this premium on butterfat. Yeah. Are you

01:04:54.599 --> 01:04:58.000
truly maximizing your butterfat production? That's

01:04:58.000 --> 01:05:00.980
the first question. Second, how much of your

01:05:00.980 --> 01:05:05.420
anticipated 2025 milk production is protected

01:05:05.420 --> 01:05:09.380
against those lower USDA price forecasts? Right.

01:05:09.420 --> 01:05:11.980
Have you hedged? Right. Have you taken steps

01:05:11.980 --> 01:05:14.480
to lock in a price? Right. So that you're not

01:05:14.480 --> 01:05:17.300
exposed to that downside risk. Right. Third,

01:05:17.500 --> 01:05:20.889
are you positioned to benefit? if feed costs

01:05:20.889 --> 01:05:23.230
were to decline okay so that's thinking about

01:05:23.230 --> 01:05:26.170
your input cost exactly right are you structured

01:05:26.170 --> 01:05:28.570
in a way right that you can capture those savings

01:05:28.570 --> 01:05:31.429
right if feed prices go down fourth have you

01:05:31.429 --> 01:05:34.349
really looked at your cash flow yeah and how

01:05:34.349 --> 01:05:37.269
a lower average milk price would impact it right

01:05:37.269 --> 01:05:39.469
because you've got to be able to pay the bill

01:05:39.469 --> 01:05:42.710
absolutely right cash flow is king it is and

01:05:42.710 --> 01:05:45.150
finally does your current plan for expansion

01:05:45.150 --> 01:05:48.230
right still make sense given the reduced forecast

01:05:48.230 --> 01:05:51.730
for Overall milk value. Right. So are you chasing

01:05:51.730 --> 01:05:54.489
volume? Yeah. When maybe you should be focusing

01:05:54.489 --> 01:05:57.210
on value. Exactly. Those are tough questions.

01:05:57.369 --> 01:06:00.289
They are. But they're questions that every dairy

01:06:00.289 --> 01:06:02.630
producer needs to grapple with. Absolutely. So

01:06:02.630 --> 01:06:04.590
if we're looking at a strategic roadmap here.

01:06:04.769 --> 01:06:06.730
Yeah. What are the key things that producers

01:06:06.730 --> 01:06:09.550
should be doing? Well, I think the first thing

01:06:09.550 --> 01:06:11.969
is to really focus on those component yields.

01:06:12.190 --> 01:06:14.230
Right. Especially butterfat. Make sure you're

01:06:14.230 --> 01:06:16.909
doing everything you can to maximize the amount

01:06:16.909 --> 01:06:19.480
of butterfat in your milk. Second, implement

01:06:19.480 --> 01:06:22.440
those risk management strategies. Hedging is

01:06:22.440 --> 01:06:25.239
your friend. Protect yourself from price volatility.

01:06:25.619 --> 01:06:29.800
Third, scrutinize your input costs. Look for

01:06:29.800 --> 01:06:33.239
every opportunity to drive efficiency. Right.

01:06:33.360 --> 01:06:35.579
And reduce those costs. Because every penny counts.

01:06:35.820 --> 01:06:38.500
It does. Right. And finally, make sure you're

01:06:38.500 --> 01:06:40.619
targeting the right markets. Okay. You know,

01:06:40.619 --> 01:06:43.280
understand what product streams are most profitable

01:06:43.280 --> 01:06:46.599
and make sure your milk quality is aligned with

01:06:46.599 --> 01:06:49.199
those markets. So it's not just about producing

01:06:49.199 --> 01:06:51.360
milk anymore. Right. It's about producing the

01:06:51.360 --> 01:06:53.639
right kind of milk. Exactly. And managing your

01:06:53.639 --> 01:06:56.480
business in a smart and strategic way. Absolutely.

01:06:56.659 --> 01:07:00.000
This isn't time for business as usual. God. The

01:07:00.000 --> 01:07:02.179
market is changing. Yeah. And you need to change

01:07:02.179 --> 01:07:05.880
with it. So to sum it all up, the dairy market

01:07:05.880 --> 01:07:10.699
in 2025 is a complex and potentially volatile

01:07:10.699 --> 01:07:14.280
picture. Yeah, there's a lot going on. We've

01:07:14.280 --> 01:07:17.619
got this strong emphasis on butterfat value,

01:07:17.820 --> 01:07:20.639
particularly in Europe. But then this downward

01:07:20.639 --> 01:07:23.760
pressure on overall milk prices. Especially here

01:07:23.760 --> 01:07:25.860
in the U .S. Yeah, so it's a real balancing act.

01:07:26.039 --> 01:07:28.059
It is. And the decisions that producers make

01:07:28.059 --> 01:07:30.480
today are going to have a big impact on their

01:07:30.480 --> 01:07:33.659
future. So as we leave our listeners today, I

01:07:33.659 --> 01:07:37.139
want to leave them with this thought. How might

01:07:37.139 --> 01:07:41.760
these global shifts and this divergence between

01:07:41.760 --> 01:07:45.880
the value of fat and protein How might that reshape

01:07:45.880 --> 01:07:49.119
the entire dairy industry in the years to come?

01:07:49.159 --> 01:07:51.380
That's a great question. It is. It's something

01:07:51.380 --> 01:07:53.780
to think about. It is. It's not just about the

01:07:53.780 --> 01:07:56.880
immediate situation. Right. It's about the long

01:07:56.880 --> 01:07:59.139
-term implications. Absolutely. And the potential

01:07:59.139 --> 01:08:02.179
for really fundamental changes. Right. We could

01:08:02.179 --> 01:08:04.920
be seeing a real transformation in the dairy

01:08:04.920 --> 01:08:06.840
industry. So that's something for everyone to

01:08:06.840 --> 01:08:10.079
ponder. Yeah, it's a lot to think about. It is.

01:08:10.500 --> 01:08:13.429
Finally, we turn to international trade. where

01:08:13.429 --> 01:08:15.750
tensions with China are creating ripple effects

01:08:15.750 --> 01:08:18.909
for U .S. dairy farmers. China's decision to

01:08:18.909 --> 01:08:21.930
block U .S. beef imports threatens billions in

01:08:21.930 --> 01:08:24.729
revenue from cull cows. We'll explore how this

01:08:24.729 --> 01:08:27.090
impacts dairy producers and what steps can be

01:08:27.090 --> 01:08:30.270
taken to mitigate losses. Okay, folks, welcome

01:08:30.270 --> 01:08:32.670
to another deep dive. You know, we like to roll

01:08:32.670 --> 01:08:35.470
up our sleeves here and really dig into a story

01:08:35.470 --> 01:08:37.510
that could really matter for your livelihood.

01:08:37.850 --> 01:08:40.989
Oh, yeah, definitely. And today, we're looking

01:08:40.989 --> 01:08:43.880
at something that's... particularly relevant,

01:08:43.960 --> 01:08:46.939
I think, for anyone involved in agriculture and

01:08:46.939 --> 01:08:50.159
specifically, you know, kind of focusing in on

01:08:50.159 --> 01:08:52.779
the beef industry and, you know, kind of some

01:08:52.779 --> 01:08:54.720
surprising connections it has to other parts

01:08:54.720 --> 01:08:57.699
of agriculture. Yeah, for sure. So the story

01:08:57.699 --> 01:09:00.800
that we're diving into is China's decision, seemingly,

01:09:00.939 --> 01:09:05.180
to... not renew registrations for a whole bunch

01:09:05.180 --> 01:09:07.380
of U .S. beef plants. So we're talking about

01:09:07.380 --> 01:09:09.020
a significant number of facilities that are no

01:09:09.020 --> 01:09:11.739
longer able to export to mainland China. And

01:09:11.739 --> 01:09:13.560
we're going to be looking at a news article that

01:09:13.560 --> 01:09:15.880
really breaks down what that means and kind of

01:09:15.880 --> 01:09:18.439
the domino effect that this could have. Yeah,

01:09:18.479 --> 01:09:20.119
and some of the places that domino falls are

01:09:20.119 --> 01:09:22.760
pretty unexpected, I think. Exactly. So our mission

01:09:22.760 --> 01:09:24.880
today is to really untangle this story and figure

01:09:24.880 --> 01:09:28.060
out why it matters, especially if you're not

01:09:28.060 --> 01:09:31.500
directly involved in the beef industry. What

01:09:31.500 --> 01:09:34.079
are the surprising ways that this can ripple

01:09:34.079 --> 01:09:36.140
through different agricultural sectors? And yeah,

01:09:36.199 --> 01:09:38.340
maybe even hit your bottom line. Yeah, definitely.

01:09:38.479 --> 01:09:40.060
I mean, like you said, it might seem like a pretty

01:09:40.060 --> 01:09:42.960
specific trade issue at first, but the implications

01:09:42.960 --> 01:09:44.920
are really far reaching when you start thinking

01:09:44.920 --> 01:09:46.720
about the bigger picture. Right. So let's get

01:09:46.720 --> 01:09:49.380
into the nitty gritty here. So around Sunday,

01:09:49.479 --> 01:09:54.220
March 16th, 2025, the registrations for, I think

01:09:54.220 --> 01:09:58.000
it's roughly 390 U .S. beef plants that were

01:09:58.000 --> 01:10:00.600
operating under that 2020 phase one trade agreement

01:10:00.600 --> 01:10:03.439
with China reportedly expired and were not renewed.

01:10:03.619 --> 01:10:06.020
So, you know, for those who aren't familiar with

01:10:06.020 --> 01:10:07.300
these kinds of trade agreements, can you just

01:10:07.300 --> 01:10:09.060
kind of paint a picture of what that actually

01:10:09.060 --> 01:10:10.899
means for these facilities? Sure. So basically,

01:10:11.020 --> 01:10:14.819
those plants have lost their authorization to

01:10:14.819 --> 01:10:17.619
export beef to China. You can think of it like

01:10:17.619 --> 01:10:21.109
a permit that's expired. These registrations

01:10:21.109 --> 01:10:23.529
were what allowed U .S. beef to enter that Chinese

01:10:23.529 --> 01:10:25.409
market. And now for a lot of these facilities,

01:10:25.590 --> 01:10:28.529
that door is essentially closed. And what makes

01:10:28.529 --> 01:10:31.189
it even more kind of curious is that the registrations

01:10:31.189 --> 01:10:33.470
for pork and poultry plants were actually renewed.

01:10:33.869 --> 01:10:36.350
They were extended pretty far into the future,

01:10:36.369 --> 01:10:39.829
all the way to 2030. Wow. Which makes the fact

01:10:39.829 --> 01:10:42.130
that beef is being singled out even more striking.

01:10:43.020 --> 01:10:44.779
You know, it raises questions about what's really

01:10:44.779 --> 01:10:46.340
going on behind the scenes. Yeah, that's a big

01:10:46.340 --> 01:10:47.899
question mark, why those two would be renewed

01:10:47.899 --> 01:10:51.380
and beef specifically wouldn't. Yeah. So what's

01:10:51.380 --> 01:10:53.260
the immediate economic fallout here? I mean,

01:10:53.260 --> 01:10:54.920
we're talking about a major market potentially

01:10:54.920 --> 01:10:56.840
being cut off. So, you know, what kind of figures,

01:10:57.039 --> 01:10:59.460
dollar figures are we looking at? Yeah. So the

01:10:59.460 --> 01:11:01.840
estimated potential loss in U .S. beef exports

01:11:01.840 --> 01:11:05.659
because of this is somewhere around $4 .13 billion,

01:11:06.000 --> 01:11:08.840
which is a huge chunk of change. You know, it's

01:11:08.840 --> 01:11:11.600
a significant disruption to how U .S. beef has

01:11:11.600 --> 01:11:13.640
been flowing into international markets. And,

01:11:13.659 --> 01:11:15.140
you know, the news article we're looking at specifically

01:11:15.140 --> 01:11:18.619
mentions that on China's General Administration

01:11:18.619 --> 01:11:21.340
of Customs website, the status of these beef

01:11:21.340 --> 01:11:24.199
facilities switched from effective to expired,

01:11:24.359 --> 01:11:26.800
which is a pretty clear indication that this

01:11:26.800 --> 01:11:29.239
isn't just a paperwork issue or you know some

01:11:29.239 --> 01:11:31.720
sort of delay it's a deliberate decision on their

01:11:31.720 --> 01:11:35.600
part yeah that's not a good sign so you know

01:11:35.600 --> 01:11:37.819
this is where i think it starts to connect to

01:11:37.819 --> 01:11:39.500
a wider audience and you know particularly for

01:11:39.500 --> 01:11:44.289
our listeners um how does this beef export issue

01:11:44.289 --> 01:11:47.369
with China potentially impact, say, a dairy farmer

01:11:47.369 --> 01:11:49.109
here in the U .S.? Right. So this is where it

01:11:49.109 --> 01:11:50.789
gets really interesting. This connection is something

01:11:50.789 --> 01:11:52.789
that a lot of people might not realize. So for

01:11:52.789 --> 01:11:55.529
dairy farmers, a significant portion of their

01:11:55.529 --> 01:11:57.869
income besides selling milk obviously comes from

01:11:57.869 --> 01:12:00.649
selling cull cows. These are cows that maybe

01:12:00.649 --> 01:12:02.489
aren't producing as much milk anymore, so they're

01:12:02.489 --> 01:12:05.770
sold for beef. And when you have these export

01:12:05.770 --> 01:12:07.449
opportunities limited, like we're seeing with

01:12:07.449 --> 01:12:10.369
China, it means more of that beef that would

01:12:10.369 --> 01:12:12.529
have gone overseas ends up staying in the domestic

01:12:12.529 --> 01:12:15.319
U .S. market. And when you have an increase in

01:12:15.319 --> 01:12:17.340
supply, naturally, that's going to put downward

01:12:17.340 --> 01:12:20.220
pressure on prices. And that includes the prices

01:12:20.220 --> 01:12:23.600
paid for coal cows. So a dairy farmer who's planning

01:12:23.600 --> 01:12:25.699
to sell some coal cows could suddenly be facing,

01:12:25.720 --> 01:12:28.260
you know, a much lower price than they were expecting

01:12:28.260 --> 01:12:30.239
because of this situation with China. Wow. It's

01:12:30.239 --> 01:12:32.470
like a domino effect. Yeah, exactly. It's an

01:12:32.470 --> 01:12:34.869
indirect consequence, but it's a very real one.

01:12:35.069 --> 01:12:37.609
Less demand for U .S. beef in China leads to

01:12:37.609 --> 01:12:39.710
more beef here at home. Yeah. And that drives

01:12:39.710 --> 01:12:42.069
down the price for all beef, including those

01:12:42.069 --> 01:12:44.949
cull cows from dairy farms. And, you know, what

01:12:44.949 --> 01:12:47.050
makes this even more unfortunate is the timing

01:12:47.050 --> 01:12:49.630
of all of this. The article points out that this

01:12:49.630 --> 01:12:51.710
is happening when dairy margins are already pretty

01:12:51.710 --> 01:12:54.250
tight. They've decreased by something like 11

01:12:54.250 --> 01:12:56.130
percent. Right. Yeah. It's definitely a tough

01:12:56.130 --> 01:12:58.050
time for dairy farmers. And when milk prices

01:12:58.050 --> 01:13:00.829
are lower. that income from selling cull cows

01:13:00.829 --> 01:13:02.869
becomes even more important. It's like a safety

01:13:02.869 --> 01:13:05.069
net. You know, it helps them weather those storms

01:13:05.069 --> 01:13:08.170
of low milk prices. But if that safety net is

01:13:08.170 --> 01:13:10.449
also shrinking because of these depressed cull

01:13:10.449 --> 01:13:12.550
cow prices, it puts them in a really tough spot.

01:13:12.909 --> 01:13:14.630
Yeah, it's like that buffer they rely on is suddenly

01:13:14.630 --> 01:13:17.470
a lot thinner. Exactly. So China restricts U

01:13:17.470 --> 01:13:20.010
.S. beef and a dairy farmer, you know, thousands

01:13:20.010 --> 01:13:22.010
of miles away feels the pinch in their wallet.

01:13:22.170 --> 01:13:25.890
Yeah. But let's talk about the why here. Why

01:13:25.890 --> 01:13:28.430
would China do this? What's their motivation?

01:13:28.960 --> 01:13:31.260
So the article points to a couple of likely reasons.

01:13:31.500 --> 01:13:33.659
The first is that there's been these ongoing

01:13:33.659 --> 01:13:35.960
trade tensions between the U .S. and China for

01:13:35.960 --> 01:13:38.420
a while now. Right. And this could be another

01:13:38.420 --> 01:13:41.859
move in that larger game of economic chess. You

01:13:41.859 --> 01:13:43.399
know, they're trying to exert some leverage.

01:13:43.560 --> 01:13:45.439
Yeah, it's almost like a retaliatory kind of

01:13:45.439 --> 01:13:47.760
thing. Yeah, potentially. And the second reason

01:13:47.760 --> 01:13:50.720
is probably more directly tied to the beef market

01:13:50.720 --> 01:13:53.600
itself. There are reports that China's actually

01:13:53.600 --> 01:13:56.520
been dealing with an oversupply of beef domestically.

01:13:56.600 --> 01:13:58.550
Oh, interesting. Yeah, apparently. Apparently,

01:13:58.550 --> 01:14:00.510
Chinese beef producers were experiencing some

01:14:00.510 --> 01:14:03.470
financial losses in 2024. And by limiting imports

01:14:03.470 --> 01:14:06.109
specifically of beef, but not pork and poultry,

01:14:06.270 --> 01:14:08.710
it seems like they're trying to protect their

01:14:08.710 --> 01:14:11.909
own domestic beef industry from those price declines.

01:14:12.029 --> 01:14:13.590
You know, they want to prop up their own producers.

01:14:13.810 --> 01:14:16.869
So it's a strategic decision on their part, looking

01:14:16.869 --> 01:14:19.970
out for their own internal market and maybe using

01:14:19.970 --> 01:14:22.350
this as a bargaining chip in these broader trade

01:14:22.350 --> 01:14:24.689
negotiations. Right. So you mentioned the phase

01:14:24.689 --> 01:14:28.449
one trade deal. does this situation potentially

01:14:28.449 --> 01:14:31.750
represent some sort of breach of that agreement.

01:14:32.010 --> 01:14:34.569
Well, according to the USDA, China hasn't actually

01:14:34.569 --> 01:14:37.489
responded to their repeated requests to renew

01:14:37.489 --> 01:14:40.170
those plant registrations. And the phase one

01:14:40.170 --> 01:14:42.250
trade deal specifically says that China should

01:14:42.250 --> 01:14:44.890
update its list of approved plants within 20

01:14:44.890 --> 01:14:48.130
days of getting updates from the USDA. So the

01:14:48.130 --> 01:14:50.350
silence from them definitely raises some eyebrows.

01:14:50.630 --> 01:14:52.409
You know, does it violate the terms of that agreement?

01:14:52.729 --> 01:14:54.569
It sounds like it could. Yeah. And what's interesting

01:14:54.569 --> 01:14:56.270
is that this isn't even the first time this has

01:14:56.270 --> 01:14:58.609
happened. The article mentions that there were

01:14:58.609 --> 01:15:01.270
84 U .S. plant registrations that lapsed back

01:15:01.270 --> 01:15:04.189
in February of 2025. And while shipments from

01:15:04.189 --> 01:15:06.050
those plants were initially still getting through

01:15:06.050 --> 01:15:08.430
customs, it's not clear how long that's going

01:15:08.430 --> 01:15:10.569
to last. So there's a pattern emerging here.

01:15:10.649 --> 01:15:13.850
It's not just this sudden big batch of 390. Right.

01:15:13.930 --> 01:15:16.310
It's a more gradual kind of erosion of these

01:15:16.310 --> 01:15:18.329
approvals, which is even more concerning. Yeah,

01:15:18.430 --> 01:15:20.510
definitely. So to really appreciate the scope

01:15:20.510 --> 01:15:22.090
of this, let's kind of zoom out for a second

01:15:22.090 --> 01:15:24.409
and look at the bigger picture of meat trade

01:15:24.409 --> 01:15:27.500
between the U .S. and China. How big of a market

01:15:27.500 --> 01:15:30.739
is this for American producers? So the article

01:15:30.739 --> 01:15:34.180
gives us some helpful numbers. In 2024, the U

01:15:34.180 --> 01:15:36.979
.S. was China's third largest meat supplier by

01:15:36.979 --> 01:15:42.260
volume. They exported about 590 ,000 tons, which

01:15:42.260 --> 01:15:44.939
is roughly 9 % of all the meat that China imported.

01:15:45.220 --> 01:15:47.100
Wow, that's a sizable chunk. And in terms of

01:15:47.100 --> 01:15:49.119
value, the U .S. was actually the second largest

01:15:49.119 --> 01:15:52.319
supplier with exports totaling $2 .5 billion.

01:15:52.760 --> 01:15:55.779
Wow. So those figures really illustrate how important

01:15:55.779 --> 01:15:57.760
the Chinese market is for U .S. meat producers.

01:15:57.979 --> 01:16:00.840
And that $4 .13 billion impact we talked about

01:16:00.840 --> 01:16:03.180
earlier doesn't just include the direct loss

01:16:03.180 --> 01:16:05.460
of those exports to China. It also factors in

01:16:05.460 --> 01:16:07.140
the ripple effect that this could have on prices

01:16:07.140 --> 01:16:09.579
in other markets. Oh, right. So like key export

01:16:09.579 --> 01:16:12.479
markets for the U .S., like Japan, South Korea,

01:16:12.659 --> 01:16:15.600
Taiwan. Okay. Those prices could also soften

01:16:15.600 --> 01:16:18.649
because if China... this big buyer steps back

01:16:18.649 --> 01:16:21.250
from the global market, overall demand decreases.

01:16:21.529 --> 01:16:24.109
And that can push prices down even in places

01:16:24.109 --> 01:16:26.409
where the U .S. can still sell their beef. So

01:16:26.409 --> 01:16:29.130
it's not just losing those direct sales. It's

01:16:29.130 --> 01:16:31.670
also the potential for a wider price drop in

01:16:31.670 --> 01:16:33.550
a bunch of other important markets. Exactly.

01:16:33.750 --> 01:16:36.329
And the article also highlights that certain

01:16:36.329 --> 01:16:38.710
cuts of beef are going to be particularly vulnerable.

01:16:38.989 --> 01:16:41.029
You know, the cuts that don't have as much demand

01:16:41.029 --> 01:16:43.739
here in the U .S. Right. If they can't be exported

01:16:43.739 --> 01:16:45.539
to China, where there might be more demand for

01:16:45.539 --> 01:16:47.800
them, they essentially become a surplus here,

01:16:47.920 --> 01:16:50.319
driving prices down even further. So for our

01:16:50.319 --> 01:16:52.720
listeners who might be sweating a little bit

01:16:52.720 --> 01:16:54.399
right now, thinking about how this might affect

01:16:54.399 --> 01:16:56.359
them, what are some things they can do? What

01:16:56.359 --> 01:16:58.199
are some proactive steps or strategies they can

01:16:58.199 --> 01:17:01.539
consider? Yeah, so the article does outline a

01:17:01.539 --> 01:17:04.159
few things. One thing producers could think about

01:17:04.159 --> 01:17:06.680
is adjusting their culling schedules. So if they

01:17:06.680 --> 01:17:09.069
have cows that are ready to be culled, You know,

01:17:09.109 --> 01:17:11.029
maybe it makes sense to try and sell them sooner

01:17:11.029 --> 01:17:13.050
rather than later before those prices potentially

01:17:13.050 --> 01:17:15.590
drop even further. Get ahead of it. Right. But

01:17:15.590 --> 01:17:17.810
on the other hand, if they can afford to keep

01:17:17.810 --> 01:17:20.109
those less productive cows for a little bit longer,

01:17:20.289 --> 01:17:22.630
they might want to delay culling and hope that

01:17:22.630 --> 01:17:25.050
the situation with China improves. You know,

01:17:25.069 --> 01:17:26.989
it's a gamble either way. Yeah, it's a tough

01:17:26.989 --> 01:17:30.170
call. And another option is exploring alternative

01:17:30.170 --> 01:17:32.890
marketing channels for their dairy beef. So maybe

01:17:32.890 --> 01:17:35.649
looking into direct marketing to local processors.

01:17:36.520 --> 01:17:38.819
or finding niche markets that might be a little

01:17:38.819 --> 01:17:41.720
more stable and less reliant on these big export

01:17:41.720 --> 01:17:43.739
markets. So thinking outside the box a little

01:17:43.739 --> 01:17:45.680
bit. Exactly. And the article also mentioned

01:17:45.680 --> 01:17:47.760
some specific risk management tools that are

01:17:47.760 --> 01:17:50.800
available. Right. So one of those is the USDA's

01:17:50.800 --> 01:17:53.619
Livestock Risk Protection, or LRP, insurance

01:17:53.619 --> 01:17:57.300
program for cull cows. And this insurance can

01:17:57.300 --> 01:17:59.600
actually cover a pretty significant portion of

01:17:59.600 --> 01:18:01.840
the expected market value at the end of the insurance

01:18:01.840 --> 01:18:06.100
period, like 70 % to 100%. Wow. pretty good.

01:18:06.220 --> 01:18:08.640
Yeah. And the premiums for this coverage are

01:18:08.640 --> 01:18:10.520
subsidized by the government. So it can be a

01:18:10.520 --> 01:18:12.579
really helpful option for producers who are worried

01:18:12.579 --> 01:18:14.539
about those price drops. That's good to know.

01:18:14.640 --> 01:18:16.560
And for producers who are a little more experienced

01:18:16.560 --> 01:18:18.420
with financial markets, you know, they might

01:18:18.420 --> 01:18:21.319
want to consider using CME live cattle futures

01:18:21.319 --> 01:18:25.319
contracts, specifically buying put options on

01:18:25.319 --> 01:18:28.520
those contracts. This is a way to hedge against

01:18:28.520 --> 01:18:31.619
potential declines in cattle prices. It's essentially

01:18:31.619 --> 01:18:33.640
like buying insurance against a price decrease.

01:18:34.060 --> 01:18:36.779
You know, You pay a premium for the option, but

01:18:36.779 --> 01:18:38.619
it protects you from some of that downside risk.

01:18:38.800 --> 01:18:40.460
So a range of options for producers, depending

01:18:40.460 --> 01:18:42.180
on their comfort level and their experience.

01:18:42.359 --> 01:18:44.560
Right. I think this situation really highlights,

01:18:44.680 --> 01:18:47.479
you know, how vulnerable many dairy operations

01:18:47.479 --> 01:18:50.039
have become. You know, they're really reliant

01:18:50.039 --> 01:18:53.399
on strong coal cow values, especially when milk

01:18:53.399 --> 01:18:55.710
prices are already struggling. Yeah, absolutely.

01:18:55.970 --> 01:18:57.970
I mean for a lot of dairy farmers that income

01:18:57.970 --> 01:19:00.949
from selling cull cows has become a major factor

01:19:00.949 --> 01:19:03.970
in their profitability, particularly when milk

01:19:03.970 --> 01:19:07.279
margins are tight. And this situation with China

01:19:07.279 --> 01:19:10.020
is a perfect example of how easily that revenue

01:19:10.020 --> 01:19:13.000
stream can be disrupted by things happening on

01:19:13.000 --> 01:19:15.079
the global stage. You know, things that might

01:19:15.079 --> 01:19:17.239
seem totally unrelated to what they're doing

01:19:17.239 --> 01:19:19.279
on the farm. Yeah, it's a real wake up call.

01:19:19.420 --> 01:19:21.659
Right. So to sum it all up for our listeners,

01:19:21.920 --> 01:19:25.579
China's decision to essentially block these registrations

01:19:25.579 --> 01:19:29.000
for U .S. beef plants has the potential to really

01:19:29.000 --> 01:19:32.039
push down those cull cow prices. And this is

01:19:32.039 --> 01:19:33.800
happening at a time when a lot of folks in the

01:19:33.800 --> 01:19:36.340
dairy industry, are already dealing with those

01:19:36.340 --> 01:19:38.140
shrinking profit margins on their milk. Right.

01:19:38.220 --> 01:19:41.220
It's a perfect storm. And the key takeaway here

01:19:41.220 --> 01:19:43.079
is that this situation is constantly evolving.

01:19:43.560 --> 01:19:45.239
You know, how this plays out in the long run

01:19:45.239 --> 01:19:47.460
depends on how these trade relationships change

01:19:47.460 --> 01:19:49.779
how the market reacts. There's so many interconnected

01:19:49.779 --> 01:19:52.229
pieces at play. Yeah, it's a complex issue. It

01:19:52.229 --> 01:19:54.090
is. And as you're listening to all of this and

01:19:54.090 --> 01:19:55.729
kind of digesting it, I want you to think about

01:19:55.729 --> 01:19:59.430
this. You know, what other global events, things

01:19:59.430 --> 01:20:02.310
that might not seem directly related to agriculture

01:20:02.310 --> 01:20:05.489
at first glance could actually have a huge impact

01:20:05.489 --> 01:20:08.119
on your operation? Right. You know, this situation

01:20:08.119 --> 01:20:10.920
with beef and dairy is a perfect example of how

01:20:10.920 --> 01:20:14.000
interconnected our world is, how something happening

01:20:14.000 --> 01:20:16.220
on the other side of the globe can ripple all

01:20:16.220 --> 01:20:18.479
the way back to your farm and affect your bottom

01:20:18.479 --> 01:20:21.399
line. It really emphasizes the importance of

01:20:21.399 --> 01:20:23.500
staying informed about what's going on in the

01:20:23.500 --> 01:20:26.260
world, even things that seem unrelated to agriculture.

01:20:26.619 --> 01:20:29.039
Yeah. Knowledge is power in this case. So stay

01:20:29.039 --> 01:20:31.020
informed. Think about those connections and be

01:20:31.020 --> 01:20:33.800
proactive about managing your risk in this ever

01:20:33.800 --> 01:20:35.659
-changing global marketplace. Couldn't say better

01:20:35.659 --> 01:20:39.279
myself. All right, folks, until next time. That

01:20:39.279 --> 01:20:41.779
wraps up this week's episode of the Bullvine

01:20:41.779 --> 01:20:45.000
Weekly Roundup. From community resilience to

01:20:45.000 --> 01:20:47.899
market challenges, these stories remind us of

01:20:47.899 --> 01:20:50.319
the complexities and opportunities in our industry.

01:20:50.960 --> 01:20:53.239
Be sure to visit The Bullvine for more in -depth

01:20:53.239 --> 01:20:56.640
coverage and resources. Until next time, stay

01:20:56.640 --> 01:20:58.399
informed and stay strong.