dairy outlook 2013
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Dairy Outlook 2013. Marin Bozic North Dakota Dairy Convention Mandan, ND November 6, 2012. Plan for today. Who is this guy and how do you pronounce his name? Taking a pulse of the U.S dairy sector The Big Mac( ro ): Why is U.S. GDP growth so slow? Long-term dairy dynamics: Global - PowerPoint PPT PresentationTRANSCRIPT
Dairy Outlook 2013
Marin BozicNorth Dakota Dairy Convention
Mandan, ND November 6, 2012
1) Who is this guy and how do you pronounce his name?
2) Taking a pulse of the U.S dairy sector3) The Big Mac(ro): Why is U.S. GDP growth
so slow?4) Long-term dairy dynamics: Global5) Long-term dairy dynamics: Local
Plan for today
How do you pronounce ‘Marin’?
Dairy Food Marketing Economist
• Funded by dairy check-off
• Located at the University of Minnesota, but covering 10-state area
• Research:• Risk Management• Price Analysis• Consumer Insights• Dairy Technology
Assessment
All-milk price: 2011-2012
Jan-1
1
Mar-11
May-11
Jul-1
1
Sep-11
Nov-11
Jan-1
2
Mar-12
May-12
Jul-1
2
Sep-12
$15.00
$16.00
$17.00
$18.00
$19.00
$20.00
$21.00
$22.00
$23.00
Milk Production: 2012 vs. 2011
Source: Daily Dairy Report
Weather Outlook (Feb-Mar-Apr 2013)
Source: http://www.cpc.ncep.noaa.gov/products/predictions/90day/
Weather OutlookMay-Jun-Jul 2013
Year-to-Year Changes in U.S. Milk Production
Jan-08
Apr-08Jul-0
8Oct-
08Jan-09
Apr-09Jul-0
9Oct-
09Jan-10
Apr-10Jul-1
0Oct-
10Jan-11
Apr-11Jul-1
1Oct-
11Jan-12
Apr-12Jul-1
2-2.00%
-1.00%
0.00%
1.00%
2.00%
3.00%
4.00%
5.00%
Year-to-Year Changes in Milk Per Cow
Jan-08
Apr-08Jul-0
8Oct-
08Jan-09
Apr-09Jul-0
9Oct-
09Jan-10
Apr-10Jul-1
0Oct-
10Jan-11
Apr-11Jul-1
1Oct-
11Jan-12
Apr-12Jul-1
2-1.00%
0.00%
1.00%
2.00%
3.00%
4.00%
5.00%
Difference in U.S. vs. InternationalCheese Prices
Is Inflation a Problem?
Growth vs. Deleveraging
Income over Feed Costs Margin: 2004-2012
Jan-0
4
Aug-04
Mar-05
Oct-05
May-06
Dec-06
Jul-0
7
Feb-08
Sep-08
Apr-09
Nov-09
Jun-1
0
Jan-1
1
Aug-11
Mar-12
Oct-12
$0.00
$2.00
$4.00
$6.00
$8.00
$10.00
$12.00
$14.00
$16.00
The Kiwi Cycle(Change in Per Cow Milk Yield)
19771979
19811983
19851987
19891991
19931995
19971999
20012003
20052007
2009-15.00
-10.00
-5.00
0.00
5.00
10.00
15.00
New Zeland USA
Source: http://www.cgd.ucar.edu/cas/catalog/climind/soi5.gif
The Bottom Line
1) High feed costs will keep milk production in check. Exports may falter, providing additional domestic supply.
2) Some chance drought may stay with us.3) High volatility is the new normal, for several
years at least.4) Tune-in after lunch for farm bill update
Dairy Outlook 2013presented at the 2012 North Dakota Dairy Convention
Dr. Marin [email protected] of Applied EconomicsUniversity of Minnesota-Twin Cities317c Ruttan Hall1994 Buford AvenueSt Paul, MN 55108
You may download this presentation at http://marinbozic.info/