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Whey and Means in Wisconsin

posted on April 10, 2009


Hello, I'm Mark Pearson. America's cavernous trade deficit plunged unexpectedly in February to its lowest level in more than nine years.

According to the Commerce Department, the U.S. trade deficit fell nearly 30 percent in February to its lowest level since November of 1999. The correction marked the seventh consecutive monthly decline for the trade gap as the recession weighs heavily on imports.

The decline was paced by a 16.3 percent drop in crude oil imports, which fell to $10 billion… their smallest monthly tally in three years.

Exports of U.S. goods and services posted an unexpected rebound in February, rising by 1.6 percent to $126 billion. While modest, the gain marked the first increase in U.S. exports in seven months. The rebound was led by stronger sales of farm products including soybeans, rice and wheat.

While U.S. trade policy is a key factor in prices paid for domestic farm goods, so too are the scales of supply and demand. And no sector is more keenly aware of their impact than the dairy industry, which has ridden a roller-coaster of record high and low prices over the past few years.

Nevertheless, In Wisconsin, where the dairy industry has an annual economic impact of more than $51 billion, there were new signs this week that processors are bullish on the future.

Whey and Means in Wisconsin

Even with milk prices about 50% off their record highs a year ago, dairy processors in Wisconsin are reporting that they plan to invest $781 million dollars into their operations over the next five years. Of the dairy processors responding to a USDA survey, 80 percent said they plan to expand in the next five years, 20 percent expect to increase the amount of milk they process by 26 percent or more and just 3 percent felt they would be handling less milk.

Over the past five years, processors in the Dairy State spent $1.24 billion on upgrades to equipment and facilities. In the next five years, the National Agriculture Statistics Service expects that cheese processors alone will invest $392 million dollars. Nearly 90% of those investments will come from companies that produce over 5 million pounds of dairy products a year.

Processors also reported plans to invest $93 million in making whey products and $296 million in other dairy operations.

In January and February, 185 processing plants in Wisconsin were sent the survey, 68 percent responded. According to NASS, most of the money invested will go to buildings and processing equipment but companies will also invest in waste treatment and utility upgrades.

 


Tags: dairy infrastructure milk news Wisconsin