2018 May Board Book

National Dairy Situation & Outlook USDA Estimates

Federal Order Minimum Class Prices

Hundredweight Prices Class I Phoenix, Arizona

Jan.

Feb.

Mar.

$17.79 $16.60

$15.71 $15.26 $16.61

Milk Production

Portland, Oregon $17.34 $16.15

Boston (Northeast)

$18.69 $17.50 $14.00 $13.40

Monthly: USDA estimates milk production in the 23 major U.S. States increased 1.8% in January 2018, compared to January 2017. USDA reports that California milk production increased 2.2% compared to January 2017 (with 16,000 less cows and 60 more pounds of milk per cow). Among other western states, compared to January 2017, Arizona was up 2.8%; New Mexico was up 5.0%; andWashington was up 2.0%. Only one of the top ten milk producing states reported a production decrease. Overall, the largest percent increase was reported by Colorado at 10.4% growth in milk production (on 12,000 more cows and 55 more pounds of milk per cow). Quarterly: For the fourth quarter of 2017 compared to the third quarter of 2017, U.S. milk cow numbers decreased to 9.399 million head, milk production per cow decreased to 5,646 pounds; the net effect was a decrease in milk production to 53.1 billion pounds. USDA projects that for the first quarter of 2018 compared to the fourth quarter of 2017, milk cow numbers will increase to 9.410 million head, production per cow will increase to 5,765 pounds; the net effect would be an increase in milk production to 54.2 billion pounds. Milk Prices Comparing the fourth quarter of 2017 to the third quarter of 2017, the Class III price increased from $16.13/cwt. to $16.34/cwt.; and the Class IV price decreased from $16.36/cwt. to $14.12/cwt. USDA projects that for the first quarter of 2018 compared to the fourth quarter of 2017, the U.S. average all-milk price will decrease to $15.45-$15.75/cwt. Utility Cow Prices Comparing the fourth quarter of 2017 to the third quarter of 2017, the average U.S. utility cow price was down $11.10/cwt. to a national average of $58.68/cwt. USDA projects that the utility cow price will average $60-$64/cwt. in the first quarter of 2018.

Class III

N/A

USDA Dairy Cow Culling Activity

U.S. Dairy Cows

West Region 2 Price Range

Region 9 1 Dairy Cows

Week Ending

Head

Head

$/cwt.

01/19/18

19,200

68,100

$55-$57

01/26/18

18,800

67,300

$53-$55

02/02/18

16,600

66,800

$58-$58

02/09/18

16,100

63,600

-

1 Region 9 includes AZ, CA, HI and NV 2 West region includes AZ, NV, UT, CA, ID, OR andWA Source: USDA Market News: Report LM_CT168 and SJ_LS714

USDA Commercial Cold Storage Report

Butter American Cheese Nonfat Dry Milk 2017 2018 2017 2018 2017 2018 In Million Pounds

Month

January

222 270 273 292 310 307 280 256 218 159 169 314

224

722 745 773 805 810 832 801 780 740 733 747 816

738

227 340

February

262 247 267

March

April

May

281

June

296 296 313 321 300 317 320

July

August

September

October

November December

Source: USDA, Farm Services Agency, NASS Cold Storage and Dairy Products. (As published in the Dairy Market News)

USDA Milk-Feed Price Ratio

Top Ten Milk Production States - January 2018 (Percent Change from Same Month/Previous Year)

USDA reports that the milk-feed price ratio for January 2018 was 2.19 (down from 2.38 in December 2017). The current ratio of 2.19 means that a dairy producer can buy 2.19 pounds of feed for every pound of milk sold. The prices used to calculate the January 2018 milk-feed price ratio were: corn $3.29/bushel; soybeans $9.30/bushel; alfalfa hay $152/ton; all-milk price $16.10/cwt.

1. California +2.2% 2. Wisconsin +0.4%

6. Michigan +1.2% 7. Pennsylvania +1.4% 8. Minnesota +0.8%

3. Idaho

+2.1% -3.3% +5.8%

4. New York

9. New Mexico 10. Washington

+5.0% +2.0%

5. Texas

Prices used to calculate the milk-feed price ratio are based on U.S. prices and don’t necessarily reflect California prices.

Information from the USDA-NASS publication “Milk Production” and the USDA-ERS publication: “Livestock, Dairy, and Poultry Outlook.”

California Dairy Review

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