USDA’s National Agricultural Statistics Service released its latest “Milk Production” report on Monday, and a quick glance at the March statistics indicates that US milk production might remain fairly stagnant, at best, in the coming months. It’s just really difficult to see milk production expanding appreciably in the near future.

As reported on our front page this week, US milk production in the 24 reporting states during March totaled 18.8 billion pounds, down 0.9 percent from March 2023. Production per cow in the 24 reporting states averaged 2,115 pounds for March, three pounds below March 2023. And the number of milk cows on farms in the 24 reporting states was 8.88 million head, 71,000 head less than March 2023 and 7,000 head less than February 2024.

So to briefly summarize: as of March 2024, there were slightly fewer milk cows on US dairy farms than a year earlier and a month earlier, and those dairy cows were slightly less productive than they were last year.

All of these statistics aren’t new as far as US milk production is concerned. For example, in 2023, the number of milk cows in the 24 reporting states peaked at 8.95 million head in March. Cow numbers in those states generally declined over the next several months, and dropped below 8.9 million head in November. And they’ve now been under 8.9 million head for five straight months.

And these cows are less productive than they were a year ago. In both January and March, milk per cow in the 24 reporting states was lower than a year earlier, by nine pounds and three pounds, respectively.
Adjusting for the extra day due to leap year, February milk per cow was also lower than a year earlier.

This is just what happened in the first quarter of 2024. As USDA’s Economic Research Service noted in its “Livestock, Dairy, and Poultry Outlook” report released on April 17, over the past eight months, both dairy herd inventories and milk production decreased on a year-over-year basis in every month, with the reductions in milk production outpacing the reductions in herd size in six months.

So, how often do these kinds of milk production declines occur? Interestingly, something similar happened just a couple of years ago. Starting in November 2021, milk production for the entire US ran below a year earlier for eight consecutive months, through June 2022.

But milk production rebounded during the second half of 2022, and for the entire year, output totaled a record 226.62 billion pounds, up 0.2 percent from 2021.

It’s worth remembering that the first three months of 2022 — that is, when milk production was declining from a year earlier — featured something that the first three months of 2024 didn’t have: relatively high milk prices.

Specifically, during 2022’s first quarter, the federal order Class III price averaged $21.25 per hundredweight, while the Class III price during 2024’s first quarter averaged $15.86 per hundred. And the uniform milk price for all 11 federal orders averaged $22.67 per hundred during the first quarter of 2022, but averaged under $20.00 per hundred during the first quarter of 2024.

Expectations in early 2022 were also much more positive, from a milk-price perspective, than they have been thus far in 2024. In its monthly supply-demand estimates released in April 2022, USDA was projecting that cheese prices in 2022 would average $2.15 per pound, the Class III price would average $22.75 per hundred, and the all milk price would average $25.80 per hundred.

In its latest monthly supply-demand estimates, released a couple of weeks ago, USDA projected that cheese prices would average $1.62 per pound this year, the Class III price would average $16.20 per hundred, and the all milk price would average $20.90 per hundred.

In other words, dairy farmers arguably had more reason to be optimistic about future milk prices two years ago than they are today. And that likely helped milk production rebound during the second half of 2022.

That same ERS report cited earlier noted that, over the same period (the past eight months), both the milkfat test and nonfat solids test “increased substantially” year over year. Higher concentrations of fat, protein, and other solids (lactose and minerals), all else being equal, should reduce the amount of raw milk required for comparable amounts of dairy products.

One thing that’s especially notable about the ongoing milk production declines is how widespread they are. That is, of the 24 reporting states, just seven posted production increases in March, while 17 posted production declines. Of the top 10 milk-producing states, only California and Wisconsin reported milk production increases in March.

Finally, when looking at milk production prospects for the rest of 2024, we can’t help but mention bird flu. Here’s what USDA had to say about this last week: “Based on information available at this point, we do not anticipate that this will impact the availability or the price of milk or other dairy products for consumers.”

Whether or not that proves correct remains to be seen. But it’s another factor pointing to flat milk production this year...

Dick Groves

Dick Groves has been publisher/editor of Cheese Reporter since 1989. He has over 45 years experience covering the dairy industry. His weekly editorial is read and referenced throughout the world.
For more information, call 608-316-3791 dgroves@cheesereporter.com
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