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September milk production posts a slight increase

Nov. 8, 2013 | 0 comments

CHICAGO, IL

Delayed by 11 days because of the earlier partial shutdown of the federal government, the national milk production statistics that were finally released on Friday, Nov. 1, showed a minimal one percent increase for September when compared to September of 2012.

That number stood in contrast to the 2.5-percent increase that was calculated in the comparative statistics for August of 2013 and 2012. The latest report noted that the previously reported milk production for August was adjusted downward by 33 million pounds, taking .2-percent off the previously stated 2.7-percent increase.

Of the 23 top milk production states, 17 were credited with an increase in the September comparisons. Five had a decrease while Minnesota had no change.

Cow numbers return

With the start of the new federal fiscal year on October, marking the end of a budget sequestration, the listing of dairy cow numbers by state and a calculation of average milk per cow for the month were resumed in the report typically issued near the end of the third week of every month.

Part of the slowdown in the milk production increase could be assigned to a reported cutback of 19,000 in the dairy cow numbers from August-September in the top 23 states. That put the total for those states at 8.506 million head, which was, however, an increase of 33,000 from September of 2012.

The average milk production per cow in the top 23 states averaged 1,741 pounds in September - up by 12 pounds from a year earlier. States with the highest averages were Colorado at 1,965 pounds, New Mexico at 1,955 pounds, Washington at 1,935 pounds, and Michigan and Idaho at 1,930 pounds each.

Wisconsin statistics

Wisconsin was directly in line with the national average for September with a one percent increase in the monthly comparisons for the two years. This gave the state a milk production total of 2.22 billion pounds, which was a record high for the month as the state appears headed for another record high milk production total for the year.

For September, Wisconsin was reported to have 1.272 million dairy cows - an increase of 1,000 from a year earlier. Their milk production average for September was calculated at 1,745 pounds - up by 15 pounds from September of 2012.

California had a .4-percent increase in its September milk production for a total of 3.197 billion pounds. It had 1.781 million dairy cows - 2,000 more than a year earlier - and a milk production average of 1,795 pounds per cow for September.

The year-year comparisons for September showed a 1.5-percent decrease in Idaho, a 1.8-percent increase in New York, a 1.5-percent increase in Pennsylvania, a 1.4-percent increase in Texas, a 3.4-percent increase in Michigan, and a 1.4-percent decrease in New Mexico, where the cow numbers were down by 4,000 to 322,000.

Among the other states, Florida had the highest milk production percentage increase of 7.1, followed by Kansas at 5.9, Iowa at 5.5, Utah at 4.5, and Virginia at 3.8. Together, their monthly production is less than two-thirds of that in Wisconsin.

Price movements

Following a long period of relatively small daily price changes for dairy commodities in the spot market on the Chicago Mercantile Exchange, the 7.25-cent per pound drop for Cheddar cheese barrels on Wednesday of this week as the result of an uncovered offer to sell one carload was an attention-getter. This lowered the price to $1.7975 per pound.

At least on Wednesday, the Cheddar block price was not affected. During two carload sales on Wednesday, it held at $1.9025 per pound, which is where it was after price gains on Thursday and Friday of last week.

The AA butter spot market price continued to recover during eight carload sales on Monday and Tuesday of this week. The price held at $1.56 per pound on Wednesday as one carload was offered at that price.

Non-fat dry milk continued to set price highs for 2013 in the spot market. Grade A tacked on .50-cent on Wednesday to close at $1.9150 per pound as a bid for two carloads was not filled. The Grade Extra price held at $1.86 per pound.

Futures Markets

The Class III milk futures market reacted to the sharp drop in the Cheddar barrel price on Wednesday. Prices fell by 11 to 31 cents per hundred for nearby months and showed little change into early 2015.

In trading on early Wednesday afternoon, the Class III futures were at $18.77 for November, $17.82 for December, $17.07 for January 2014, and in the low $17s or upper half of the $16s per hundred for the remaining months of 2014.

The dry whey futures prices promise to underpin the Class III milk price by at least $3 per hundred through 2014. In very light trading on Wednesday, prices stood in a range of a high of 56.75 cents per pound for December of 2013 down to 50 cents for December of 2014.

Current Prices

The national Class III milk base price at 3.5-percent butterfat for milk shipped in October is $18.22 per hundred. That is an increase of 8 cents from the September price but $2.80 less than the 2012 monthly Class III price high of $21.02 per hundred for October.

However, the milk to feed price ratio calculated for October rose to above 2 for the first time since March of 2011. The reported ratio of 2.09 is a result of the $20.30 all-milk price estimate for October, a shelled corn price of $4.49 per bushel (down from $5.40 in September), and a $12.60 per bushel price for soybeans compared to $13.30 for September.

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