Nation's record high milk production continues

Ray Mueller

Chicago, IL. – Milk production in the United States continues at record high volumes, according to the National Agricultural Statistics Service's report for September that was issued on October 20.

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The September report indicated a 2.1 percent increase from a year ago for a total of 16.697 billion pounds of milk for the month. Four of the top six production states had increases of 4.9 to 5.8 percent in the monthly comparisons for the two years.

Those states are Idaho and New York with 4.9 percent increases each to 1.228 billion and 1.209 billion pounds of milk respectively for September, Michigan with a pickup of 5.8 percent to 874 million pounds, and Texas with a gain of 5.3 percent to 869 million pounds.

Since September of 2015, both Michigan and Texas have nudged past Pennsylvania on milk production. Despite a 1.3 percent increase in the September comparisons, Pennsylvania stood in 7th place among the states with its 867 million pounds for the month this year.

Wisconsin up 3.3 percent

Wisconsin also contributed to the national increase with its increase of 3.3 percent for a September total of 2.439 billion pounds of milk. That's an increase of 79 million pounds from September of 2015.

Dairy cow numbers in Wisconsin were down by 2,000 from a year ago to 1.277 million head. An average milk increase of 65 pounds per cow to 1,910 pounds was responsible for the state's uptick in milk production for the month.

Dairy cow changes

Across the United States, dairy cow numbers were up by 22,000 from a year ago to a total of 9.338 million for September. The average milk per cow of 1,817 pounds for the month was up by 33 pounds from a year ago.

During the past year, major changes in dairy cow numbers have occurred in some states. Since September of 2015, Texas was up by 26,000 head, Michigan and Idaho by 12,000 each, and Colorado and South Dakota by 7,000 each.

On the down side, California's total slipped by 11,000 head to 1.766 million, New Mexico and Florida were down by 5,000 each, Utah was down by 4,000, and Pennsylvania's total was down by 3,000 to 527,000 head.

Downturn in seven states

Among the top 23 milk production states, seven reported a milk production decrease in the September comparisons. California was down by 2 million pounds or .1 percent for a September total of 3.17 billion pounds.

New Mexico was down by 3.5 percent to 625 million pounds for September. The other states reporting decreases for the September comparisons were Virginia, Utah, Florida, Oregon, and Illinois.

Spot market update

After several weeks of decline, the spot market price for AA butter on the Chicago Mercantile Exchange (CME Group) headed up during the past week. That turnaround was highlighted by a 5.5 cent per pound gain on Wednesday of this week for a day's closing price of $1.8850 – up by 11 cents from a week earlier. Four carloads were sold on Wednesday to boost the week's total to 25 sales and a bid to buy one carload was not filled.

The Cheddar block cheese gained 1.75 cent on Wednesday to close at $1.6550 per pound. Three carloads were sold to put the week's total at five sales. A bid for one carload was not filled.

Cheddar barrels lost .25 cent on Wednesday for a closing price of $1.5575 per pound. Two carloads were sold to bring the week's total to eight sales, an offer to sell one carload was not covered, and a bid to buy one carload was not filled.

Grade A non-fat dry milk lost .50 cent in the spot market on Wednesday as one carload was sold to put the week's total at five sales. A bid to buy one carload was not filled. The day's closing price was 86.50 cents per pound.

Small change in futures

Very little change occurred in the Class III milk futures prices in trading through late Wednesday morning. The lowest price on trading board was $14.73 per hundred for October of 2016.

The national Class I fluid milk base price for November is $14.78 per hundred. This is a decline of $1.82 from the October price and of $1.70 from the November 2015 price.

Class III milk futures prices stood in the $15s per hundred for November through April of 2017 before rising into the $16s for all subsequent months through September of 2018. Most of those prices were in the lower half of the $16s per hundred.

Dry whey futures were trading in a very narrow range between 36.075 and 38.75 cents per pound for all months from November 2016 through November of 2017.

Dairy export report

On Monday of this week, Cooperatives Working Together announced the receipt of a batch of eight bids from members for financial assistance on the export of 873,301 pounds of butter and 136,687 pounds of Cheddar cheese to buyers in Asia, North Africa, and the Middle East for deliveries extending into January of 2017.

The requests were submitted by Foremost Farms USA, Dairy Farmers of America, Northwest Dairy Association (Darigold), United Dairymen of Arizona, and O-AT-KA Upstate Niagara.