June 28, 2020


US milk output drops 1% in May



The major dairy states in the US dropped milk production by 1% in May, one of the steepest on-year declines since the 2009 dairy crisis, reported Lancaster Farming.


The 24 states that produce nearly all the nation's milk reduced monthly per-cow production by 32 pounds as many cooperatives took measures to curb supply.


The coronavirus pandemic had reduced demand, especially in the foodservice sector.


May's decline matched the 1% drop in February 2017, USDA statistics show. The only larger drop in the past decade was 3.4% in February 2013.


Milk production has mostly exceeded the same month in the previous year since 2009, a grim year for dairy producers that saw down or flat production most months.


The major Northeastern dairy states cut production even more steeply than the whole nation in May.


Pennsylvania was down 3%, New York 3.7% and Vermont 6.4%.


Of the major dairy states, New Mexico's production fell the most, 7.2%. Wisconsin was down 3.1%.


A few states saw big gains in milk production in May, most notably South Dakota, 9.7%; Idaho, 4.8%; and Colorado, 4.6%.


In Pennsylvania and Vermont, the April milk price averaged US$15.30 per hundredweight before deductions, while in New York it was US$14.70.


Those numbers are slightly higher than the national figure of US$14.40 per hundredweight, but still mark huge declines of more than US$3 from March.


With demand down and surplus milk being dumped, many cooperatives implemented supply management programs this spring.


Dairy Farmers of America said that in May it would start guaranteeing its Northeastern members full value for only 85% of the volume of milk that they produced in March.


By late May, markets had improved enough that some cooperatives were preparing to ease their supply restrictions, according to Matthew Gould, an editor at Dairy and Food Market Analyst.


June's average dairy commodity prices are expected to be up significantly, especially for cheese and butter, according to Federal Milk Marketing Order 1.


The 24 major dairy states produced 18 billion pounds of milk last month. They had 50,000 more cows than last May but shed 12,000 cows from April.