Top states boost August milk totals

CHICAGO, IL

A milk production decrease in a handful of the top volume states underpinned a 1.9 percent increase in August compared to the month last year, according to preliminary numbers released on Tuesday of this week by the National Agricultural Statistics Service.

The nation's milk production for August was a record high of 17.7 billion pounds for the month. Dairy cow numbers were at 45,000 from August of 2015 and by 16,000 from July of this year to a total of 9.36 million. The average milk per cow of 1,895 pounds was 27 pounds more than in August last year.

Giant Texas leap

With an 11 percent jump from a year ago to a total of 918 million pounds for August, Texas leaped past Pennsylvania to land in 5th place among the states for milk production. Texas added 25,000 cows for a total of 487,000 and its average milk per cow was up by 95 pounds to 1,885 pounds for August.

Idaho, which ranks 3rd among the states for milk production, reported a 4.9 percent increase in the August comparisons for a total of 1.285 billion pounds this year. Cow numbers were up by 13,000 to 599,000 and milk per cow increased by 55 pounds for an average of 2,145 pounds.

Michigan, which holds 4th place among the states, continued its milk production run with a 6.6 percent increase to 935 million pounds for August. Compared to a year ago, it added 1,200 cows for a total of 422,000 and its milk per cow was up by 75 pounds to an average of 2,215 pounds, trailing only Colorado's 2,235 pounds in that category.

Top two states

Wisconsin also contributed to the national uptick of 1.9 percent with its 2.4 percent increase for August. The state's addition of 50 million pounds to a total of 2.543 billion pounds was due to the 50 pound average increase per cow to 1,990 pounds because cow numbers were down by 2,000 to 1.278 million.

California continued on its slide in milk production, which began in December of 2014, by shedding another 56 million pounds or 1.7 percent for an August total of 3.287 billion pounds. Cow numbers were down by 11,000 to 1.767 million and the average milk per cow slipped by 20 pounds to 1,860 pounds for August.

The only other states posting a decline in the August comparisons are all at the bottom of the rung among the top 23 states. In order of the percentage of a production cutback, they are Florida, Virginia, Utah, Illinois, and Pennsylvania, which slipped to 6th place among the states with its 897 million pounds for August.

Another development in Pennsylvania is that its milk marketing board approved a $1.75 per hundred over-order per premium – an increase of 15 cents -- for the portion of its milk used in Class I for fluid bottling during the final quarter of 2016.

Barrels busy on CME

This week was a busy one for carload sales of Cheddar cheese barrels in the spot market at the CME Group. Ten carloads were sold on Monday and 11 on Tuesday.

That trend continued on Wednesday with the sale of six more carloads of Cheddar barrels. An offer to sell one more carload was not covered as the price gained .25 cent to close at $1.51 per pound.

Eight carload sales of Cheddar cheese blocks were completed on Wednesday in the spot market. On a market day, which also had an uncovered offer to sell one carload and an unfilled bid to buy one carload, the price slipped by 1.25 cents to close at $1.5850 per pound.

Butter below $2 pound

For the first time since late March of this year, the spot market price for AA butter fell below $2 per pound early this week. The price recovered 1.25 cents per pound on Wednesday to close at $1.9675 as six carloads were sold to boost the week's total to 14 sales and a bid to buy two carloads was not filled.

Grade A non-fat dry milk gained .25 cent per pound on Wednesday to close at 92.25 cents. Three carloads were sold, a bid to buy two carloads was not filled, and an offer to sell two carloads was not covered.

Futures stage loss

Class III milk futures lost 27 to 33 cents per hundred for the three months in the final quarter of 2016 in early afternoon trading on Wednesday. All months from January through August of 2017 also posted losses.

The day's price changes left the Class III futures at $16.36 per hundred for September, $15.93 for October, $16.15 for November, in the high $15s for all months from December 2016 through March of 2017, and in the $16s per hundred for all subsequent months through August of 2018.

In the dry whey futures market, for which most of the contracting was for October and November of this year, the lowest price was 30.35 cents per pound for September while all other months through August of 2018 were between 34.5 and 40 cents per pound. Every 1 cent of the dry whey price carries about a 6 cent per hundred value for the Class III milk cash price.