Milk production continues on year-long upward trend

As has been the case for most months in 2011, milk production in the top 23 dairy states has been approximately two percent above that for the comparable month in 2010. That trend continued with the report for November issued early this week.

The preliminary report for those 23 states indicated a total of 14.736 billion pounds of milk produced. This is an increase of 2.2 percent from November 2010.

For the entire country, the U.S. Department of Agriculture's report indicated that milk production for November was up by 1.8 percent compared to a year ago. With only December yet to be added, the United States is on path for a record milk production of 196.1 billion pounds for 2011 - up by 1.7 percent from 2010.

What was different about the month's numbers was the decrease in percentage changes from a year earlier. Texas stood at the top of the list on change percentage with an 8.4 percent increase to 787 million pounds of milk for November.

Increases in other states included 6.3 percent in New Mexico to 673 million pounds, 6.6 percent in Florida, 6 percent in Arizona, 4.8 percent in Utah, Colorado at 4.7 percent, 4.4 percent in Washington and 3.9 percent in Michigan. States with decreases were Pennsylvania at 2 percent, New York at 1.3 percent, Missouri at .9 percent, Virginia at .7 percent and Minnesota at .1 percent.

Wisconsin again trailed the 23-state average with its 1.6 percent production increase from November 2010. The state's production of 2.094 billion pounds did, however, set a record high for November.

As of December 1, Wisconsin had 11,786 dairy cow herds licensed to ship milk to the commercial market. This is down by 69 from Nov. 1 and by 681 from Dec. 1, 2010.

Dairy cow numbers in the 23 states were up by 108,000 - to 8.481 million - compared to a year ago.

Wisconsin's total held at 1.265 million but California, which had a 2.4 percent increase to 3.343 billion pounds for November, had added 27,000 cows from a year earlier for a total of 1.778 million.

Other significant cow number changes from a year ago were increases of 20,000 in Texas, 14,000 in New Mexico, 10,000 in Washington and 9,000 each, Michigan, Arizona, and Colorado. Cow numbers were down by 4,000 both in Pennsylvania and Iowa and by 2,000 both in Missouri and Vermont. Since September, however, dairy cow numbers are down by 4,000 head in the country as a whole.

The average milk per cow in the 23 states for November was 1,738 pounds - up by 16 pounds from a year ago. Wisconsin had an increase of 25 pounds to 1,655, California was up by 15 pounds to 1,880 and New Mexico continued to post the highest average milk per cow with an increase of 35 pounds to 2,020 pounds for November.

After decreasing steadily for nearly one month and by nearly 25 percent in total, the spot market prices for Cheddar cheese on the Chicago Mercantile Exchange have steadied as the Christmas weekend approaches.

On Wednesday of this week, Cheddar blocks closed unchanged at $1.5625 per pound (an uncovered offer to sell one carload was the day's activity) while Cheddar barrels tacked on .50-cent during two carload sales to close at $1.55 per pound.

The barrel market was very active late last week with a total of 16 carload sales on Dec. 15 and 16.

The AA butter spot market remained active with the sale of three carloads and an unfilled bid to buy five carloads on Wednesday of this week. The price held at $1.5950 per pound as was also true in the recently inactive non-fat dry milk spot market where prices stand at $1.48 per pound for Grade Extra and $1.45 for Grade A.

New monthly highs for 2012 were established early this week in the futures market for dry whey. Even after slight price cutbacks on Wednesday, the prices stood at 67.75 cents per pound for January, 69 cents for March and 52.5 cents for November and December 2012.

The Class III milk futures prices had minimal changes on Wednesday of this week. With just trading week remaining, the December futures were steady at $18.70 per hundred but the prices for all of 2012 and 2013 reflect the recent decline in the Cheddar cheese spot market prices.

Those futures prices are the low $17s and high $16s per hundred for all months of 2012 and in the lower half of the $16s for most months of 2013.