Reasonable feed costs are helping dairy producers increase milk production.
Per-cow production was the highest for July since 2003, USDA says.
The nation’s dairy cows made milk – lots of it – in July.
Milk output in the nation’s 23 major dairy states rose 4% last month over July 2013 levels, reaching 16.4 billion pounds, according to USDA’s Milk Production report released today.
Only March and May saw higher monthly milk production volume this year.
USDA also reported that per-cow production averaged 1,911 pounds last month, up 61 lb. from July 2013. That’s the highest production per cow for the month of July since the 23-state series began in 2003, USDA said.
The number of milk cows in the 23 major states rose to 8.58 million head, an increase of 56,000 head over July 2013 levels and 6,000 head more than in June 2014.
The report was "decidedly bearish in comparison to expectations," noted Dave Kurzawski, a risk management consultant with INTL FC Stone.
"We’ll look for lower pricing overnight following this report," Kurzawski said.
All but three major dairy states increased milk production in July over year-earlier levels. Arizona saw the highest percentage increase, boosting its output by 8.9% to 378 million pounds. Michigan’s production rose by 8.2% to 829 million pounds, while Colorado grew by 7.6% to 310 million pounds. California increased its milk production by 4.4%, swelling its milk output to a whopping 3.520 billion pounds for the month. Wisconsin’s 3.4% jump pushed its milk levels to 2.394 billion pounds for July.
"Cooler weather and better forage quality may finally be helping increase milk production in the upper Midwest and, if that trend continues, prices seem likely to soon fall from their lofty levels," Kurzawski predicted.
USDA revised its numbers for June 2014’s milk production, increasing it by 2.3% to 16.2 billion pounds.
While July’s overall 4% production jump surprised commodity broker Robin Schmahl of AgDairy Market, he expects more milk ahead. "With higher milk prices, reasonable feed costs and a drive by dairy producers to add more cows, we could see a substantial increase in milk production this fall," Schmahl says.