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Chicago, Ill. -  In the monthly milk production totals for February that were reported by the National Agricultural Statistics Service (NASS) on Monday of this week, the statistics in the annual comparison of months are misleading in this case because of the Leap Day in February of 2016.

At face value, milk production in February of 2017 appears to be down by 1.2 percent in the United States and by 2.1 percent in Wisconsin but the difference of one day in the months distorts the statistical comparisons by about three percentage points.

Daily diagnosis

The NASS report puts the nation's milk production for the 28 days in February of 2017 at 16.695 billion pounds compared to 16.904 billion pounds for the 29 days in February of 2016. However, the daily production averages were 582.89 million pounds in 2016 and 594.46 million pounds in 2017 – an increase of 1.98 percent for 2017.

Similarly, in Wisconsin, the February milk production fell from 2.374 billion pounds in 2016 to 2.323 billion pounds in 2017. For the daily average, however, the numbers were 82.96 million pounds in 2017 compared to 81.86 million pounds in 2016 – an increase of 1.2 percent for this year.

Dairy cow numbers stood at an estimated 1.28 million head for both years in Wisconsin. With no change in cow numbers, average milk per cow was up by 1.2 percent although the per cow average for the month dropped by 40 pounds to 1,815 pounds because of the one-day difference.

The nation's dairy cow total was 9.367 million head for February – up by 56,000 from a year ago and by 4,000 from January of this year. Average milk per cow for February was 1,782 pounds compared to the 1,815 pounds during the extra day month in 2016.

State statistics

Despite the distortions in the numerical comparisons, a number of states posted impressive February to February increases. The stated percentages which follow have not been adjusted for the difference in February days.

Leading the way in milk production increase group was Texas, which, in February of 2016, was suffering the effects of a devastating late 2015 winter storm. For this year in February, its milk production of 928 million pounds was an increase of 102 million pounds or 12.3 percent from a year earlier.
New Mexico, which was also hit by the late 2015 storm, had a 7.8 percent increase with 46 million more pounds of milk for a total of 637 million pounds. Compared to February of 2016, cow numbers were up by 40,000 to 495,000 head in Texas and by 14,000 to 325,000 in New Mexico.

Other states in the top 23 for milk production which maintained positive percentages in the February comparisons were Michigan (1.2), Colorado (3.3), Iowa (1), Kansas (3.8), South Dakota (1), and Pennsylvania (.2).

California percentage setback ballooned to 5.4 on milk production of 3.122 billion pounds for February. Washington topped that with a 5.6 percent drop while other states which slipped into negative percentages were Idaho (2.7), Ohio (2.8), Minnesota (.6), and Arizona (.7).

Prices, volumes up

At recent trading sessions for dairy commodities in the spot market at the CME Group, Cheddar cheese prices staged a price upturn while some single day transactions hit attention-getting volumes.

For Cheddar cheese in the spot market on Wednesday of this week, the numbers were almost identical. Prices for both blocks and barrels gained 2 cents to close at $1.45 and $1.41 per pound respectively, a bid to buy one carload of each was not filled, and an offer to sell one carload of each was not covered. Three carloads of barrels and two of blocks were sold.

Grade A non-fat dry milk (NFDM) advanced by 1.75 cents on Wednesday to close at 82.25 cents per pound as three carloads were sold, a bid for four carloads was not filled, and an offer to sell two carloads was not covered. The AA butter price stood at $2.12 per pound as an offer to sell one carload was not covered.

In trading volumes, Thursday (March 16) was one of the busiest days ever with the sale of 22 carloads of butter, 11 of Cheddar cheese barrels, and 5 of NFDM. On Tuesday of this week, 17 carloads of barrels and 8 of blocks were sold and a bid for six carloads of NFDM was not filled.

Milk futures down

Despite the uptick in Cheddar cheese spot market prices, the Class III milk futures for most months in 2017 were trading a bit lower early in the session on Wednesday. Prices were $15.76 per hundred for March, $15.34 for April, $15.64 for May, and $15.97 for June of 2017 before moving into the $16s per hundred for all months from July 2017 through February of 2019.

Dry whey futures prices, however, posted gains for all months in 2017 for which contracts were traded on Wednesday morning. Prices stood in an unusually wide range of 51.5 cents per pound for March to lows of just over 35 cents for December 2017 and early months in 2018.

On Monday of this week, Cooperatives Working Together reported the receipt of requests for financial assistance on 22 contracts to export 3.523 million pounds of Cheddar, Gouda, and Monterey Jack cheeses to buyers in Asia and Oceania on deliveries to be completed in June. Unlike most similar announcements, the requesting parties were not identified.

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