Milk production increase a backdrop for lower dairy commodity market prices
Milk production jumped by 3.7 percent in the top 23 states and by 3.4 percent for the United States as a whole in January compared to a year earlier.
Cow numbers were up by 76,000 to a total of 9.236 million and the average milk per cow of 1,835 pounds was an increase of 45 pounds compared to January of 2011.
Wisconsin was in line with the production trend for the top 23 states with an increase of 3.7 percent for January for a total of 2.277 billion pounds. This broke the January record of 2.195 billion pounds set in 2011.
All of the state's increase was due to the 65-pound jump in average milk production per cow - to 1,800 pounds - because the cow numbers remained at 1.265 million.
In other states, milk production jumped by 6.6 percent in California to a total of 3.615 billion pounds and by 4.7 percent to 1.116 billion pounds in Idaho.
Other states with much lower milk production but with significant increases in the January to January comparisons were Utah at 8.6 percent, Colorado at 7.8 percent, Arizona at 7 percent, Indiana at 5.8 percent, Washington at 5.4 percent and Illinois at 4.9 percent.
The final report for milk production in 2011 put the year's total at 196.245 billion pounds. This was an increase of 1.8 percent from 2010.
Average milk production per cow during 2011 was 21,345 pounds. This was an increase of 197 pounds from 2010. For the decade through 2011, the average milk production per cow has increased by 14.7 percent.
While milk production has been increasing, the prices for dairy commodities continue to head in the opposite direction.
For instance, Class III milk futures have sunk to $15.23 per hundred for April of this year, are in the lower $16s per hundred for the latter half of 2012 and do not show any strength for 2013 or early 2014, where the January futures stood at $15.10 per hundred on Wednesday of this week.
With a week of trading to go, the February futures were at $16.09 per hundred.
Little price movement has occurred in the spot market on the Chicago Mercantile Exchange during the past week.
There were a few carload sales on most recent market days, highlighted by the sale of 10 carloads of Cheddar cheese 40-pound blocks on Tuesday of this week.
Both Cheddar blocks and barrels lost .50-cent per pound on Wednesday, closing at $1.48 and $1.4750, respectively.
The day's market activity was the sale of three carloads of blocks and two of barrels along with one uncovered offer to sell for each.
In the AA butter spot market, one carload sold on Wednesday of this week and one offer to sell was not covered as the price held at $1.4150 per pound.
Spot market prices for non-fat dry milk have settled to $1.2975 per pound for Grade Extra and $1.2925 for Grade A.
Red ink continued to dominate on the dry whey futures prices on Wednesday.
As a result, the February futures had slipped to 63.5 cents per pound but the price drops sharply to 50 cents by April and into the 40s per pound for the remainder of 2012 and well into 2013.
Cooperatives Working Together has announced the acceptance of 17 bids from Bongard's Creamery, Darigold Cooperative, Dairy Farmers of America, United Dairymen of Arizona, and the Michigan Milk Producers Association.
The bids are for assistance on the export of 1.281 million pounds of Cheddar, Gouda, and Monterey Jack cheese and 989,000 pounds of butter to countries in Asia, Central America, North Africa, and the Middle East by June.