2020 Salute to Dairy
Special Section Honoring our West Side Dairy Industry Special Section Honoring our West Side Dairy Industry
2 | CELEBRATING OUR LOCAL DAIRY INDUSTRY THURSDAY, JUNE 18, 2020Prices plunge during pandemic; but recovery may be emergingCalifornia dairy producersenjoyed a solid 2019after suffering through afour-year downturn in theprices they were paid fortheir milk and carried optimisminto 2020.Then came the novelcoronavirus and a pandemicwhich upended life in nation’saround the world.Shock waves from thepandemic rolled throughthe economy as a whole andthe dairy industry was notspared as milk prices paidto producers plunged in theface of the crisis.But, as unexpectedly asthe pandemic itself, milkprices appeared to be significantlyon the way to recoveryas May gave way toJune, according to one industryeconomist.“What is fascinating isthat in the last week or so Ihave seen an unprecedentedrally in the market,” AnnieAcMoody, director of economicanalysis for WesternUnited Dairymen, told MattosNewspapers in a June5 interview. “The blockcheese prices set a new recordhigh price, somethingthat we have never seen.We went from borderlinecatastrophe to June pricesapproaching record highsin some commodities, mostlycheese. In California, alot of our production goesto cheese, so it is a big dealfor our producers.”AcMoody said she anticipatesprices paid to producersfor June jumping tothe $18 per hundredweightrange - or about where theprices stood back in thepre-COVID days of February.In the interim, she said,prices fell to around $17 inMarch, plummeted to $14 inApril and slipped further to$13 in May.“That is a huge jump,”AcMoody stated, adding thecautionary note that pricesmay slip somewhat in July.“I think $18 is kind of aSee ECONOMY | PAGE 3Prices paid to dairy producers plunged with the emergence of the novel coronavirus pandemic, but indications of a recovery are cause for at leastcautious optimism in the industry.WE'RE YOUR TRUSTED INSURANCE SPECIALISTS!Rico, Pfitzer, Pires& AssociatesYour Local Full-ServiceINDEPENDENT INSURANCE AGENCY“Committed to Service, Quality and You”Agricultural &Commercial InsuranceWorker’s Compand more!Personal LinesAutomobile • MotorcycleLife • HealthHome • RV, Boat & MoreAgricultural • Commercial • Industrial • BusinessWorkers Compensation • Risk ManagementLoss Prevention • OSHA ComplianceGUSTINE207 5th Street854-2000Se Habla Español • Fala-se Português www.rppins.comLic. #0499798
THURSDAY, JUNE 18, 2020 CELEBRATING OUR LOCAL DAIRY INDUSTRY | 3ECONOMYCONTINUED FROM PAGE 2ceiling considering the issueswe have in the economy,”she stated.AcMoody acknowledged,though, that while she is“cautiously optimistic”about the remainder of 2020a number of unknowns remain.“If there is another lockdownin the fall, we couldsee the same thing again,”she said of the pandemicimpact on the dairy industry.AcMoody said that thepandemic-related drop inmilk prices could be attributedprimarily to widespreadrestaurant closures.About 50 percent of thedomestic cheese demandand 45 percent of demandfor butter is generated bythe food service sector, Ac-Moody told Mattos Newspapers.“The product to restaurantsno longer had a placeto go,” she explained. “Retailsales increased, butnot enough to make up forthe loss of restaurants.Some commodities (suchas cheese) are more dependenton food service thanretail.”On the production side,AcMoody said, plants aretailored for very specificproducts and were unableto quickly pivot to anotherproduct to meet shiftingdemand.The pizza industry wasthe exception to the COV-ID-19 restaurant impacts,she noted.“They were already setup for delivery and takeout,”AcMoody said. “Somepizza chains recorded theirhighest sales month in history.”That was to the benefit ofCalifornia producers, shenoted, because the stateis the largest producer ofmozzarella cheese.AcMoody said that pricesto producers in the $17-$18range is roughly a tippingpoint for producers.“They can make it at thatlevel. It is more sustainable,”she commented. “Ifyou go under that for a longperiod of time you are goingto have some peoplewith problems.”Commodity prices forfeed supplies needed bydairy producers also trendeddownward when the pandemichit, AcMoody pointedout.“I haven’t heard that theyare going back up like themilk prices are,” she said.“We could get a little bit ofa break there.”Early on, AcMoody said,2020 was looking like astrong year for dairy producers.Prices had reached nearly$20 per hundredweightat year’s end - the highestlevel since a record-setting2014 when milk pricestopped $22.“It was pretty slowgrowth, but it progressivelykept improving until theend of 2019. If softened alittle bit in early 2020, butit was still a good start tothe year that stemmed fromthe improvement (in 2019),”AcMoody said. “Thingswere going as they wereexpected to go.....and thenthey didn’t.”A saluteto dairyfarmersDuring dairy month,we salute our local dairy farmers andpledge our support to this upstandingindustry. Keep up the good work!ACME ELECTRIC CO.“Let us check your shorts”Buster Lucas, Owner1025 S. KILROY, TURLOCK 667-2851Proudly Part of the West Side Dairy Industrysaluting dairy familiesMello Trucking, Inc.209.988.8178Manuel Canga, M.D.general & Family Medicine1248 Main Street, Suite D • Newman
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2 | CELEBRATING OUR LOCAL DAIRY INDUSTRY THURSDAY, JUNE 18, 2020
Prices plunge during pandemic; but recovery may be emerging
California dairy producers
enjoyed a solid 2019
after suffering through a
four-year downturn in the
prices they were paid for
their milk and carried optimism
into 2020.
Then came the novel
coronavirus and a pandemic
which upended life in nation’s
around the world.
Shock waves from the
pandemic rolled through
the economy as a whole and
the dairy industry was not
spared as milk prices paid
to producers plunged in the
face of the crisis.
But, as unexpectedly as
the pandemic itself, milk
prices appeared to be significantly
on the way to recovery
as May gave way to
June, according to one industry
economist.
“What is fascinating is
that in the last week or so I
have seen an unprecedented
rally in the market,” Annie
AcMoody, director of economic
analysis for Western
United Dairymen, told Mattos
Newspapers in a June
5 interview. “The block
cheese prices set a new record
high price, something
that we have never seen.
We went from borderline
catastrophe to June prices
approaching record highs
in some commodities, mostly
cheese. In California, a
lot of our production goes
to cheese, so it is a big deal
for our producers.”
AcMoody said she anticipates
prices paid to producers
for June jumping to
the $18 per hundredweight
range - or about where the
prices stood back in the
pre-COVID days of February.
In the interim, she said,
prices fell to around $17 in
March, plummeted to $14 in
April and slipped further to
$13 in May.
“That is a huge jump,”
AcMoody stated, adding the
cautionary note that prices
may slip somewhat in July.
“I think $18 is kind of a
See ECONOMY | PAGE 3
Prices paid to dairy producers plunged with the emergence of the novel coronavirus pandemic, but indications of a recovery are cause for at least
cautious optimism in the industry.
WE'RE YOUR TRUSTED INSURANCE SPECIALISTS!
Rico, Pfitzer, Pires
& Associates
Your Local Full-Service
INDEPENDENT INSURANCE AGENCY
“Committed to Service, Quality and You”
Agricultural &
Commercial Insurance
Worker’s Comp
and more!
Personal Lines
Automobile • Motorcycle
Life • Health
Home • RV, Boat & More
Agricultural • Commercial • Industrial • Business
Workers Compensation • Risk Management
Loss Prevention • OSHA Compliance
GUSTINE
207 5th Street
854-2000
Se Habla Español • Fala-se Português www.rppins.com
Lic. #0499798
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