KDDC Strategies for Success

1
KENTUCKY DAIRY DEVELOPMENT COUNCIL Strategies
for Success
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2
KDDC VISION

• To Empower Kentuckys Dairy Stakeholders By
  Developing Relationships and Providing Resources
  That Enhance the Profitability of the Dairy
  Industry.

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3
KDDC MISSION

• To preserve, enhance and energize Kentuckys
  dairy infrastructure.
• To address issues which will foster the
  sustainability and viability of Kentuckys Dairy
  Industry.

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GOALS AND OBJECTIVES

• To increase the profitability of KYs dairy
• producers industry.
• To foster growth development for KYs
• dairy industry.
• To promote dairy friendly legislation.
• To work with regulatory agencies on rules
• which affect the industry.

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GOALS AND OBJECTIVES

• To communicate relevant issues to KDDC members.
• To encourage cooperation with affiliated
  agriculture organizations to benefit all.
• To support Federal Marketing Order rulings
  which promote fair and equitable milk prices.

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Todays Situation

• Milk Deficit State and Declining
• Cow Numbers 110,000 2004 / 106,000 2005
• Dairy Market News reports 99,000 for Aug 2006
• 2005 Per Cow Production 12,934 lbs
• Low Percent of Producers Utilizing Technology
• Dollars from Local Processors are leaving KY in
  Transportation Cost.
• Pooling Provisions Exacerbate the Price Problem

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Historical Changes of Kentuckys Dairy Industry
Source History of Dairy Industry in Kentucky,
KDA, Eunice Schlappi, University of KY, Bill Crist
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ECONOMIC IMPACT OF KENTUCKYS DAIRY INDUSTRY

• Kentucky Dairies Produced 1.61 Billion lbs.
• Ranks 4th in Farmgate Receipts
• Ranks 7th in Agriculture Cash Receipts
• The Economic Impact is Over 903 Million.

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How Did We Get Here?

• DID SOMEONE SAY TOBACCO!
• APATHY
• LACK OF FOCUS ON REAL PROBLEMS
• FEDERAL MILK MARKETING ORDER REFORM

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KDDCs Priorities for Change

• Develop Implement Programs That Focus on
  Production and Business Technology
• Work Cohesively with Regulatory Agencies to
  Improve Milk Quality
• Address Issues that Affect Kentuckys High Fluid
  Milk Market

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Cooperating Organizations

• Kentuckys Allied Dairy Industries
• Kentucky Farm Business Management Program
• Mid-South Dairy Records DHIA
• UK College of Agriculture Cooperative Extension
  Service
• Kentuckys Land Grant Institutions
• Affiliated Agricultural Organizations
• Kentucky Community Technical College System
• The Adult Agriculture Program

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KENTUCKY DAIRY IMPROVEMENT PROGRAM (KDIP)

• KDIP will Provide assistance to Producers through
  a Network of resources including
• Four Regional Dairy Consultants that will work
  directly with Dairy Producers on the Farm
• A Kentucky Farm Business Management Specialist
  will be available to work with Dairy Producers
  through the KDDC
• Provide Opportunities for Producer to Producer,
  Producer to Industry and Producer to Advisor
  Networking

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KDIP Program cont.

• Assist Producers in forming resource teams
  including vets, nutritionist, genetics,
  financial, field-men and others
• Provide information on available financing
  programs and other resource assistance such as
  technology information, building design and more
• Provide information on using the ADB County Model
  Programs
• Establish Local Dairy Organizations

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Market Incentive Leadership for KentuckyMILK
Program

• Eligible Producers Have Opportunity to Earn
• 50 Cents per CWT on ALL MILK PRODUCED
• 10,000 per farm per year maximum
• 1 Million Awarded to KDDC by Agriculture
  Development Board Will be Matched By
• 1 Million from the Dairy Industry

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Market Incentive Leadership for KentuckyMILK
Program

• Criteria for Participation
• 10 Increase in Production in 2007 over 2006
• 10 Increase in Production in 2008 over 2006
• Milk Quality of 400,000 or below SCC and 20,000
  PI Count or below
• No Adulterated Milk for Qualifying Month
• Participation in DHIA KFBM Programs

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Market Incentive Leadership for KentuckyMILK
Program

• 100 Cow Herd _at_ 18,000 lbs RHA
• 10 Increase in Production 19,800 lbs RHA or 6
  additional lbs per cow per day over 305 d
  lactation
• 1,980,000 lbs _at_ yr 0.50/cwt 9,900
• By decreasing SCC another 100,000 many will
  qualify for Market Agency Quality Programs. Up
  to an extra 0.50 /cwt
• 1,980,000 lbs _at_ 1.00/cwt 19,800.00
  additional income for participating year.

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YOUNG DAIRY PRODUCER INITIATIVE

• Program is designed to provide education and
  resource assistance to progressive young dairy
  producers.
• Provide an opportunity to participate in an
  intensive educational and networking program.
• Two year effort with a goal of 20 young dairy
  producers and their spouses each year

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YOUNG DAIRY PRODUCER INITIATIVEThree Day
Workshop - Bowling Green, KY Holiday Inn,
February 6-9, 2007

• KDDC Incentive Programs Resources
• Quality of Life
• Milk Pricing
• Nutrition
• Milk Quality

• Financing Money Management
• Understanding Your Milk Check
• Managing for Profitability
• Animal Health

Tour of Robey Dairy and Lunch at Chaneys Dairy
Barn Attending the Workshop is a Prerequisite to
an Out of State Dairy Tour in the Fall of 2007
A 250 fee per farm entity may be provided by
sponsored scholarship
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Partner with Regulatory Agenciesto Improve Milk
Quality

• Utilize Milk Safety Specialist in Education
  Process
• Farm Inspections and Surveys
• Team Building with Milk Marketing Field Staffs
• Milk Quality Issues
• Resources Concerning
• Lowering Somatic Cell Counts
• Troubleshooting Elevated Bacteria Counts
• Proper Equipment Performance
• Minimizing Antibiotic Contamination

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Addressing Issues Affecting Milk Marketing

• Who is the Milk Market Administrator and What are
  His or Her Responsibilities?
• What is a Marketing Area and in Which Area is
  Kentucky Located?
• On Which Area Does Kentuckys Milk Get Pooled?

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Federal Order TermsOne Needs to Know Understand

• Milk Classes Associated Prices
• Milk Class Utilizations
• Uniform Blend Price
• Location Differentials

• Milk Pooling Depooling
• Qualifying Standards
• Touch Base Requirement
• Diversion Limits
• Over-Order-Premiums

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How Can Changes Be Made? The Federal Order
Rulemaking Process

• Proposal Received
• Notices and Request for Input
• Hearings
• Parties Brief Hearing
• Policy Decision Made
• Review Process

• Recommended Decision Issued
• Comment Period
• Final Decision
• Referendum
• Final Rule
• Implementation

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What Can I Do?

• Educate Yourself
• Market Administrators Web Sites
• Federal Order 5 Louisville,
  KY http//members.aye.net/usda/
• Federal Order 6 7 Atlanta, GA
• http//www.fmmatlanta.com/
• USDA Dairy Program
• http//www.ams.usda.gov/dairy/

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What Can I Do? Cont.

• Ask Questions
• Become Informed
• Know the Participants and Their Roles in the
  Market
• Talk with Your Legislators
• Believe You Can Make A Difference

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A New Day is Dawning In Kentucky The Dairy
Industry Needs YOU to Make a Difference
Daybreak Bonnie Mohr Studio PO Box 32Glencoe,
Minnesota 55336 1-800-264-6647
KDDC 10/10/06