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January 2007

Market Plan$

Craig Thomas
Extension Dairy Educator
Sanilac, Huron, Lapeer, St. Clair, and Tuscola Counties

In January 2007 the Michigan State University Extension Dairy and FIRM Teams will kick-off a major educational program in dairy marketing for dairy producers and their employees called Market Plan$. The goal is to teach producers basic and intermediate dairy marketing skills and to aid producers in developing, implementing, tracking, and evaluating a comprehensive written marketing plan for their farm business.

Market PlansMarket Plan$ consists of three major components. The first is a series of three-day workshops designed to teach dairy producers basic and intermediate dairy marketing skills. These workshops will cover a broad spectrum of topics (Table 1) designed to help participants develop a personal marketing plan for their milk through the use of the various marketing tools available and learn the ramifications of their use on the farm business’s finances. Representatives from Michigan Milk Producers Association and Dairy Farmers of America will also be on hand to explain each coop’s marketing program. The workshops will be held at five different locations (dates and locations are listed below). For information on these workshops contact the Sanilac County MSU-Extension Office at 810-648-2515, or one of the MSU-Extension Educators listed below.

The second part of the Market Plan$ effort will consist of intensive personal assistance for dairy producers in developing, implementing, tracking, and evaluating a comprehensive milk marketing plan specifically for their dairy farm business. This portion of Market Plan$ will aid dairy producers in determining the financial and marketing risk on their dairy operation. This will include a complete financial and marketing analysis for each dairy producer, plus the farm’s financial performance will be compared to industry benchmarks to aid producers in gaining a deeper understanding of their farm business. Each farm will also be assisted in developing a marketing plan for both milk and purchased feed that will be tailored to meet the specific needs of their farm. Project coordinators will then assist producers throughout the year in implementing their marketing plan, as well as tracking its progress and determining its effectiveness. Every producer’s financial and marketing information will be held in the strictest confidence.

Third, monthly Ag Market Update meetings are currently being held in Sandusky and St. Johns. The Sandusky group has been meeting since 1997 and the St. Johns group began meeting in 2003. The purpose of the Ag Market Update is to apprise producers, and other interested parties, of the current situation and outlook for all the major agricultural markets (e.g., corn, soy, wheat, dairy, beef). These monthly meetings update producers on the essential factors affecting supply, demand, and price and their potential effects on future prices which are essential in order to make intelligent and informed marketing decisions. The meetings also help producers evaluate alternative marketing strategies for their crops being sold, or for inputs they purchase such as corn and soybean meal. A major goal of the Market Plan$ program is to establish two more Ag Market Update groups meeting on a monthly basis in McBain and in Zeeland (or Fremont).

We are excited about the Market Plan$ program and are confident that it will benefit interested producers. We urge producers to participate in both the educational workshops, the Ag Market Updates, and in the intensive assistance in developing, implementing, tracking, and evaluating a comprehensive and intensive dairy marketing plan for their dairy farm business. If you are interested in any aspect of the Market Plan$ program you can obtain more information by calling one of the co-directors (Fred Hinkley, Ogemaw Co. MSU-Extension at 989-345-0692; or Craig Thomas, Sanilac Co. MSU-Extension at 810-648-2515) or by checking out the Market Plan$ Web page at the MSU-Extension Dairy Team’s new web site.  For the marketing workshops, pre-registration is required and registrations at each location are limited to the first twenty registrants.  Cost of the program is $95 for the first person from each farm (includes refreshments, lunch, and materials) plus $45 for each additional person (includes refreshments and lunch only). 

The major portion of this effort is being funded by a grant from the North Central Risk Management Education Center.  Other major partners and contributors to this project are Michigan Milk Producers Association and Dairy Farmers of America.

Market Plan$ workshop topics

  • Using futures, options, and forward contracts to control milk and feed price risk.
  • Determining milk price goals based on your cost of production and expected living standard.
  • Developing, implementing, and evaluating a written marketing plan.
  • How the milk pricing systems works.
  • What is “basis” and what does it mean to your farm.
  • Basic and intermediate strategies for managing price risk.
  • Current situation and outlook of the dairy, grain, and feed markets.
  • Cultivating beneficial working relationships with brokers and bankers.
  • Finding and using market information resources.
  • Farmer panel discussion:  hear dairy producers with real world marketing experience.

Market Plan$ workshops

McBain
Grape Arbor Inn
211 North Pine St. (M66)
Wednesdays, Jan. 3, 10, 17
Kathy Lee
Missaukee Co. MSU-Extension Office
231-839-4667

Fremont
Samuel’s Restaurant
1042 W. Main St. (M82)
Thursdays, Jan. 11, 18, and Feb. 1
Bill Robb
Muskegon Co. MSU-Extension Office
616-846-8250

Zeeland
Zeeland Township Hall
6582 Byron Rd.
Wednesdays, Jan. 24, 31, and Feb. 7
Bill Robb
Muskegon Co. MSU-Extension Office
616-846-8250

Perrinton
Fulton Township Hall
M57
Tuesdays, Feb. 13, 20, 27
Dann Bolinger
Clinton Co. MSU-Extension Office
989-224-5240

Bad Axe
Franklin Inn
1060 E. Huron Ave.
Thursdays, Feb. 15, 22, Mar. 1
Craig Thomas
Sanilac Co. MSU-Extension Office
810-648-2515

 

 

 

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