October 2, 2013

As production in the top 23 dairy states was up 2.7% on-year, the overall US milk production was up 2.6%, as revealed by the "Milk Production" report released by the USDA on September 19.

Dave Kurzawski, dairy analyst with FCStone in Chicago, called the report "bearish," since the increase was higher than expected.

He said, "This jump comes as a particular surprise, as feed costs during August were yet to really come off in any meaningful way. And with better quality feed likely to make its way into the ration moving forward, one would surmise we have the potential to see substantial gains in milk production following the grain harvest."

The largest gain posted was by Kansas at 8.8%, followed by Iowa at 8.0% and Florida at 6.9%.

Meanwhile, the number one milk-producing state, California, was up 2.7% and the number two state, Wisconsin, was up 1.7%.