CWT Announces Herd Retirement

Bids are being accepted through Friday, May 1 for the seventh herd retirement round since CWT began operations in the summer of 2003. Jerry Kozak, president and CEO of NMPF, which manages CWT is anticipating a large number of bids. However, since the value of cows and heifers has dropped dramatically, the price level of bids accepted will be much lower than in recent years. CWT has no set target for the volume of milk or the number of cows to be removed in this round.

“Whether CWT will remove a significant number of dairy animals will depend on the number of bids received and the price level of those bids. CWT will not pay more for cows than what they are currently worth in the marketplace,” said Kozak.

As was the case in 2008, in addition to submitting bids for their milk herds, participating farmers will have the option of offering all of their bred heifers at a flat price of $700 per animal. In addition, there are two program rule changes in this round:

1. Members of CWT whose bids were accepted in a previous round may bid again in this round. This is a one‐time exception to the exclusion affecting prior participants in the program.

2. Producers whose bids are accepted in the next and future herd retirements will be paid in two installments: 90 percent of the amount bid times the producer’s 12 months of milk production when it is verified that that all cows have gone to slaughter, and the remaining 10 percent plus interest at the end of 12 months following the farm audit if both the producer and his dairy facility – whether owned or leased – do not become involved in the commercial production and marketing of milk during that period.

Detailed information can be found on CWT's website, including bid forms, an interactive bid calculator to help estimate a farmer’s bid, and answers to frequently asked questions. All bids must be postmarked by Friday, May 1.