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U.S. dairymen adding cows on good margins

U.S. milk production was up 4.1 percent in September over year-ago levels, boosted by 78,000 additional cows and increased per cow production of almost 2 pounds.
Carol Ryan Dumas

Capital Press

Published on October 22, 2014 9:27AM

Last changed on October 22, 2014 9:56AM


More cows in the parlor and better production per cow pushed September milk production, at 15.5 billion pounds, 4.1 percent higher than September 2013, USDA National Agricultural Statistics Service reported Oct. 20.

September milk production was up year over year in all of the 23 major states reporting, sans Illinois, which was down less than 1 percent. Big percentage increases were seen in Colorado, up 10.8 percent; Texas, up 9.6. percent; and Kansas, up 9.2 percent.

Increases in the top five milk-production states were more modest, ranging from an increase of 2.9 percent in California to 4.5 percent in New York.

Cow numbers, at 8.59 million, were up 78,000 head over a year earlier and up 4,000 head from the August count in the 23 major states. Cow numbers were up in 14 of the reporting states, down in eight and steady in one.

The largest increases in cow numbers were in Texas, up 30,000 head; Michigan, up 14,000 head; and Washington, up 11,000 head.

Average production per cow averaged 1,804 pounds, 56 pounds above September 2013 and the highest September production per cow since the 23 state series began in 2003, NASS reported.

High milk prices and lower feed costs continue to bring favorable margins for dairy producers, said Bob Cropp, professor emeritus, University of Wisconsin, in his Dairy Situation and Outlook report also released Oct. 20.

But higher milk production, slowing dairy exports and higher dairy imports are pushing down milk prices, a scenario that is forecast to carry into next year, he said.

“Dairy product prices have declined considerably from where they were back in September with butter prices leading the way,” he said.

The September Class III price was $24.60 per hundredweight, the highest this year and $6.46 above a year earlier.

Cropp expects that to drop to near $23.95 in October, down to around $19.50 by December, about $18.25 by January and falling into the $17s most of 2015.

The September Class IV price was $22.58, $3.15 higher than September 2013.

Cropp expects lower butter prices to drag that price down to $22.20 in October and $17.10 by December. With anticipated much lower butter prices and lower nonfat dry milk prices, Class IV will likely be in the low $17s and high $16s in 2015, he said.

Two big uncertainties for milk prices next year are the level of dairy exports and how much milk production will increase, he said.

The U.S. milk price could average $3 to $5 a hundredweight lower than this year, and some forecasters are expect the decrease to be even greater, he said.

Online

NASS: http://www.nass.usda.gov

Dairy Situation and Outlook: http://future.aae.wisc.edu

September milk production, top 10 states. Figures compare September 2013 production, in million pounds, to September 2014, and the percent change.

Calif. 3,197 3,291 2.9

Wis. 2,220 2,292 3.2

Idaho 1,099 1,136 3.4

NY 1,080 1,129 4.5

Penn. 835 864 3.5

Texas 748 820 9.6

Minn. 725 736 1.5

Mich. 739 790 6.9

NM 625 646 3.4

Wash. 513 541 3.2

U.S. 14,874 15,485 4.1*

* 23 major states

Source: USDA-NASS



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