02/13/08 Dairy herd increases; grazing fees for '08

The grazing fee on Western public lands managed by the BLM and the Forest Service will be $1.35 per animal unit month in 2008. That's the same level as last year. The fee, effective on March first, applies to more than 26 thousand permits and leases administered by the two federal agencies. Without the requirement that the grazing fee cannot fall below $1.35, this year's fee would have dropped below one dollar per AUM because of declining beef cattle prices and increased production costs from the previous year. While the beef cattle herd seems to be shrinking its just the opposite for dairy. Latest government figures show the national dairy herd is one percent bigger than a year ago. SHAGAM "Producers indicated that they are holding about three percent more heifers for entry into the milk cow herd." USDA livestock analyst Shayle Shagam says production will rise about two percent this year but milk prices may fall about four percent. SHAGAM "Producers have wanted to expand have been trying to get a hold of animals and basically what we're seeing here is the follow through on a pent up demand." Shagam says as prices start coming down this year some producers who are in a weak financial position will get out of the business and others who want to expand may slow down but in general there's going to be continued growth in the dairy herd this year and into 2009. Today's Idaho Ag News Bill Scott