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Milk production surge continues through March

Ray Mueller
Wisconsin's 1.28 million cows produced 2.6 billion pounds of milk for March, an increase 1.5 percent. The gain is due to the increase of 30 pounds in milk per cow, to an average of 2,030 pounds.

CHICAGO, IL. – Milk production during March in the top 23 states increased by 1.8 percent compared to the month a year ago, according to the monthly report issued late last week by the National Agricultural Statistics Service.

Wisconsin's increase for the month was 1.5 percent, giving the state a production total of 2.598 billion pounds for March. That gain was due to the increase of 30 pounds in milk per cow, to an average of 2,030 pounds, because the number of cows in the state's milking herd remained stable at 1.28 million head.

National deviations

Although California continued to be in down cycle with a decrease of 2.9 percent for a total of 3.501 billion pounds of milk for March, the increase in Texas alone more than offset the reduction in California. In California, cow numbers were down by 12,000 to 1.755 million and the average milk per cow for March slipped by 45 pounds to 1,995 pounds for this year.

The Texas dairy sector's recovery from a devastating winter storm in late 2015 continues to be reflected in the state's milk production statistics. Cow numbers were increased by 47,000 to a new total of 507,000 head and average milk per cow was up by 110 pounds to 2,100 pounds for March of this year.

In the March comparisons for 2016 and 2017 in Texas, milk production jumped by 16.4 percent – an increase of 150 million pounds to a total of 1.065 billion pounds for March of this year – the first time the state topped 1 billion pounds in a month.

Neighboring New Mexico, which was also affected by the late 2015 storm, posted a 9 percent increase to 726 million pounds of milk as its cow numbers were up by 16,000 head to 327,000 and average milk per cow for the month increased by 80 pounds to 2,220.

State changes

Among other top production states, New York had a 3.6 percent increase to 1.281 billion pounds for March while Idaho had a 1 percent decrease to 1.214 billion pounds. Pennsylvania had a 3 percent gain to 966 million pounds and Michigan was up by 3.5 percent to 956 million pounds for March.

In other states, the percentage increases included 7.3 in Colorado, 6.6 in Kansas, and 3.7 in South Dakota. States reporting decreases in the March comparisons were Oregon (4 percent), Washington (3.3 percent), Florida, and Illinois.

For the top 23 states, the average milk per cow of 2,012 pounds for March was the highest for the month since those statistics were tabulated, starting in 2003. The 8.709 million cows in the milking herd in those states was an increase of 72,000 from a year ago while the national total of 9.37 million head was up by 57,000 from March of 2016 and by 15,000 from February of this year.

Spot market prices fall

After across the board gains on Friday, April 21, the spot market prices for dairy commodities at the CME Group posted losses on Wednesday morning of this week.

AA butter suffered a setback of 4 cents to close at $2.0975 per pound on Wednesday. One carload was sold to boost the week's total at 14 carload sales, an offer to sell 13 carloads was not covered, and a bid for two carloads was not filled.

After two market sessions without a sale, 10 carloads of Cheddar barrel cheese were sold on Wednesday and an offer to sell one carload was not covered. The price slipped by .75 cent to close at $1.42 per pound.

Cheddar block cheese lost 1 cent per pound on an uncovered offer to sell one carload to put the closing price at $1.5425 per pound. No blocks were sold in the spot market during the first three days of the week.

The Grade A non-fat dry milk price held at 85.25 cents per pound on Wednesday. A bid for four carloads was not filled and an offer to sell one carload was not covered.

Futures markets

In early afternoon trading on Wednesday, there were no more than single digit per hundred changes in the Class III milk futures for the next two years. The lowest price was the $15.20 per hundred for April, followed by $15.31 for May, $15.36 for June, and $15.81 for July.

After that, the prices rise to the $16s per hundred for all months from August 2017 through March of 2019. Most of the Class III milk contracts traded on Wednesday were for May and June of this year.

With most of the contract trading for dry whey taking place for the summer months of 2017, prices were mixed in the early afternoon on Wednesday. They started at a high of 52.7 cents per pound for April, slid to 38.9 cents for August, and dropped to 35 cents per pound for the spring months of 2018.

The Class I fluid milk national base price for May is $15.20 per hundred. This is down by 85 cents from April but up by $1.50 per hundred from May of 2016.

On Tuesday of this week, Cooperatives Working Together announced the receipt of a bid from a cooperative member for financial assistance on six contracts to sell a total of 740,753 pounds of Cheddar cheese to buyers in Asia and the Middle East. Deliveries are scheduled until July.