Feed Strategy - October 2019 - 8

8 ❙ FeedStrategy
DAIRY FEED VOLUMES

US dairy industry macro trends

Shortage of reliable labor
Immigration laws have hampered the ability of
dairies to hire immigrant workers, which account
for much of the U.S. dairy labor force.
"A reliable workforce is essential for dairies
to maintain and expand production," Towns
says. "For U.S. dairy managers, the challenge
of finding, training, managing and retaining
a quality labor force is a major and ongoing
concern. In fact, it's a challenge we hear about
every day in our conversations with customers."
New policies proposing year-round visas
to dairy workers are pending. However, the
labor gap is prompting more dairy producers
to turn to automation.

Blackburn, commercial director -
dairy, Provimi, Cargill Premix &
Nutrition, reports. "This is driven,
in part, by retaliatory Chinese
tariffs, reductions in Asian whey
exports due to African swine fever
(ASF) and uncertain dairy exports
to Mexico given that the USMCA
agreement has not been ratified."
As a result, he suspects 2019
global milk production to be flat.

2019 dairy feed
production trends
The outlook for global dairy feed
production in 2019 will vary by region
- largely due to erratic weather
patterns. Regional markets have

Industry consolidation
The dairy industry is consolidating into fewer
and larger operations.
Rabobank reports 87 U.S. domestic merger
and acquisition deals, 70 cross-continental deals
and 39 regional deals over the last 18 months
(January 2018 - June 2019).
"Europe dominated the cross-continental
deals with a 60% share and also accounted for
40% of the domestic transactions," according to
the institution's Global Top 20 report.
McDowell notes that access to capital, risk
management and production efficiency will
push producers to larger, more concentrated
operations.
On the downside, Towns notes that
processor consolidation has negatively
impacted the supply chain by limiting producer's milk market options.

dealt with the extremes of drought
and flood but, overall, feed costs and
volumes are expected to remain low.
"Feed production has been flat
across most of the major exporting
regions, including the U.S., first
because of price signals and margin
pressure; and second, because of
heat and other weather challenges,"
Laine reports.
Forage quality, cost and supply
will remain a major concern across
multiple regions.
"Farmers who raise their own
feedstuffs may end up purchasing
more feed in 2020 if their own
crop acreage was affected by poor
weather in 2019," Towns says.

Despite flooding during the
planting season, the USDA Global
Feed Outlook's corn crop projections
suggest yield increases, high levels
of grain production in Ukraine and
decreased import demand from China
due to ASF. These factors should have
a favorable impact on global corn
prices for dairy producers.
"With the continued trade disputes
and lack of market for U.S. soybeans
especially, cheap concentrates and
ingredients are readily available," says
Jessica Tekippe, R&D and technical
services manager, Ajinomoto Animal
Nutrition NA Inc.
Looking forward, feed costs are not
expected to increase in 2020, but that
www.FeedStrategy.com ❙ October 2019

dolgachov | Bigstock.com

In addition to weather woes and trade
disputes, several other trends are impacting
the U.S. dairy industry.


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Feed Strategy - October 2019

Table of Contents for the Digital Edition of Feed Strategy - October 2019

Feed Strategy - October 2019
Contents
In the Mix
Industry Happenings
Consumers, weather, trade sway 2019 dairy feed volumes
Tips for maximizing forage in ruminant rations
How to replace corn with wheat in modern animal diets
Marketing nutrition by following trends
What AGPs can teach us about growth promotion
Broad review of research presented during 2019 ESPN
Grinding: benefits of particle size modifications
Products
Advertisers’ Index
Feed Strategy - October 2019 - CT1
Feed Strategy - October 2019 - CT2
Feed Strategy - October 2019 - Feed Strategy - October 2019
Feed Strategy - October 2019 - Cover2
Feed Strategy - October 2019 - CT3
Feed Strategy - October 2019 - CT4
Feed Strategy - October 2019 - Contents
Feed Strategy - October 2019 - In the Mix
Feed Strategy - October 2019 - Industry Happenings
Feed Strategy - October 2019 - Consumers, weather, trade sway 2019 dairy feed volumes
Feed Strategy - October 2019 - 5
Feed Strategy - October 2019 - 6
Feed Strategy - October 2019 - 7
Feed Strategy - October 2019 - 8
Feed Strategy - October 2019 - 9
Feed Strategy - October 2019 - Tips for maximizing forage in ruminant rations
Feed Strategy - October 2019 - 11
Feed Strategy - October 2019 - 12
Feed Strategy - October 2019 - 13
Feed Strategy - October 2019 - 14
Feed Strategy - October 2019 - 15
Feed Strategy - October 2019 - How to replace corn with wheat in modern animal diets
Feed Strategy - October 2019 - 17
Feed Strategy - October 2019 - 18
Feed Strategy - October 2019 - 19
Feed Strategy - October 2019 - 20
Feed Strategy - October 2019 - 21
Feed Strategy - October 2019 - Marketing nutrition by following trends
Feed Strategy - October 2019 - 23
Feed Strategy - October 2019 - What AGPs can teach us about growth promotion
Feed Strategy - October 2019 - 25
Feed Strategy - October 2019 - 26
Feed Strategy - October 2019 - 27
Feed Strategy - October 2019 - Broad review of research presented during 2019 ESPN
Feed Strategy - October 2019 - 29
Feed Strategy - October 2019 - 30
Feed Strategy - October 2019 - 31
Feed Strategy - October 2019 - Grinding: benefits of particle size modifications
Feed Strategy - October 2019 - 33
Feed Strategy - October 2019 - 34
Feed Strategy - October 2019 - 35
Feed Strategy - October 2019 - 36
Feed Strategy - October 2019 - 37
Feed Strategy - October 2019 - Products
Feed Strategy - October 2019 - 39
Feed Strategy - October 2019 - Advertisers’ Index
Feed Strategy - October 2019 - Cover3
Feed Strategy - October 2019 - Cover4
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