Higher numbers for milk output, nearby month Class III futures

The surge of milk production increases has eased a bit but the report issued last week Friday by the U.S. Department of Agriculture indicated that the top 23 states still posted a 3.3 percent increase for April compared to April of 2011.

Wisconsin ran slightly ahead of the national average with an increase of 3.5 percent on its production of 2.267 billion pounds of milk for the month. This set a state record for April, topping the 2.2 billion pounds in 2010.

A combination of higher cow numbers and more average milk per cow accounted for Wisconsin's increase compared to April of 2011. Cow numbers were up by 4,000 to 1.27 million while the average milk per cow for the month was up by 55 pounds to 1,785 pounds.

Among other states in the Upper Midwest, Michigan led the way with a 6.2 percent increase for a total of 752 million pounds for April, Indiana was up by 5.6 percent, Illinois followed at 4.8 percent, and Iowa was up by 3.2 percent. Minnesota's production was up by 1.3 percent.

California was in line with the national trend on its production of 3.628 billion pounds during April (an increase of 3.1 percent) as it added 13,000 cows for a total of 1.787 million and average milk per cow increased by 35 pounds to 2,030 pounds.

Milk production percentage increases in other states were 7.9 in Utah, 6.8 in Colorado, 5.3 in Arizona, 4.8 in Ohio, 4.1 in Washington, and 3.6 in New York and New Mexico.

The only state with a milk production decline in April was Pennsylvania, which slipped by 1 percent to 909 million pounds for April.

The average milk per cow in the top 23 states for April was 1,875 pounds - an increase of 40 pounds from a year ago. Cow numbers were up by 94,000 to a total of 8.525 million.

Class III milk futures for nearby months continued a modest recovery through Wednesday of this week. Double digit gains on Wednesday put the day's closing prices at $15.60 per hundred for June, $16.05 for July, and in the low $16s and high $15s per hundred for all other months through December of 2013.

The $15.23 per hundred for May is the lowest futures price on the trading board until January of 2014.

In the Chicago Mercantile Exchange spot market on Wednesday of this week, slight gains were posted for both Cheddar barrel cheese and for non-fat dry milk. The barrels picked up 1 cent to close at $1.47 per pound as a result of an unfilled bid to buy one carload. Cheddar blocks held at $1.50 per pound during one carload sale and an unfilled bid to buy. The spot market price for AA butter in the spot market remained at $1.3850 per pound following one unfilled bid and one uncovered offer.

Reversing a months' long trend, prices rose on Wednesday for both grade of non-fat dry milk.

Grade A picked up 1 cent to close at $1.14 per pound following five carload sales and an uncovered offer to sell one carload. Grade Extra gained .75-cent as the result of an uncovered bid to close at $1.09 per pound.

Dry whey futures were another bright spot in the dairy market on Wednesday. They posted gains of up to 2.3 cents per pound for every month from June through December of this year.

Closing prices were a high of 53.5 cents per pound for May, an average of 47 cents for the balance of 2012, and very close to 38 cents per pound for a great majority of the months in 2013.

Dairy Farmers of America, Darigold Cooperative, United Dairymen of Arizona, and the Maryland and Virginia Milk Producers Cooperative have submitted a total of 24 bids to Cooperatives Working Together.

Those bids were for price assistance on the export of 3.578 million pounds of Cheddar and Monterey Jack cheeses and 1.642 million pounds of butter to countries in Asia, Africa, Central America, and the Middle East from May to November of this year.