2018 March Board Book

National Dairy Situation & Outlook USDA Estimates

Federal Order Minimum Class Prices

Hundredweight Prices Class I Phoenix, Arizona

Nov.

Dec.

Jan.

$18.76 $19.23

$17.79 $17.34 $18.69

Milk Production

Portland, Oregon $18.31 $18.78

Boston (Northeast)

$19.66 $20.13 $16.88 $15.44

Monthly: USDA estimates milk production in the 23 major U.S. States increased 1.1% in November 2017, compared to November 2016. USDA reports that California milk production decreased 1.1% compared to November 2016 (with 14,000 less cows and 5 less pounds of milk per cow). Among other western states, compared to November 2016, Arizona was up 4.3%; New Mexico was up 2.0%; andWashington was down 0.8%. Four of the top ten milk producing states reported a production decrease. Overall, the largest percent increase was reported by Colorado at 6.1% growth in milk production (on 9,000 more cows and 5 more pounds of milk per cow). Quarterly: For the third quarter of 2017 compared to the second quarter of 2017, U.S. milk cow numbers increased to 9.403 million head, milk production per cow decreased to 5,688 pounds; the net effect was a decrease in milk production to 53.5 billion pounds. USDA projects that for the fourth quarter of 2017 compared to the third quarter of 2017, milk cow numbers will increase to 9.405 million head, production per cow will decrease to 5,675 pounds; the net effect would be a decrease in milk production to 53.4 billion pounds. Milk Prices Comparing the third quarter of 2017 to the second quarter of 2017, the Class III price increased from $15.74/cwt. to $16.13/cwt.; and the Class IV price increased from $14.80/cwt. to $16.36/cwt. USDA projects that for the fourth quarter of 2017 compared to the third quarter of 2017, the U.S. average all-milk price will increase to $17.75-$17.95/cwt. Utility Cow Prices Comparing the third quarter of 2017 to the second quarter of 2017, the average U.S. utility cow price was up $0.13/cwt. to a national average of $69.78/cwt. USDA projects that the utility cow price will average $56-$59/cwt. in the fourth quarter of 2017. Top Ten Milk Production States - November 2017 (Percent Change from Same Month/Previous Year)

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.

11/24/17

12,900

48,400

$62-$62

12/01/17

16,200

59,000

$62-$62

12/08/17

16,600

62,300

$60-$64

12/15/17

16,300

60,400

$59-$59

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

USDA Commercial Cold Storage Report

Butter American Cheese Nonfat Dry Milk 2016 2017 2016 2017 2016 2017 In Million Pounds

Month

January

192 236 243 296 328 333 319 269 228 161 166 325

222 270 273 292 310 307 280 256 218 159 314

716 716 726 734 757 770 742 743 736 713 726 758

752 773 802 834 810 832 801 780 740 733 837

226 227 217 262 232 247 252 267 231 296 257 296 235 313 216 321 224 300 215 302 232 281

February

March

April

May

June

July

August

September

October

November December

228

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

USDA Milk-Feed Price Ratio

USDA reports that the milk-feed price ratio for November 2017 was 2.54 (up from 2.45 in October 2017). The current ratio of 2.54 means that a dairy producer can buy 2.54 pounds of feed for every pound of milk sold. The prices used to calculate the November 2017 milk-feed price ratio were: corn $3.15/bushel; soybeans $9.22/bushel; alfalfa hay $148/ton; all-milk price $18.10/cwt.

-1.1%

1. California

6. Michigan

+2.2%

2. Wisconsin +0.9%

7. Pennsylvania +2.1% 8. Minnesota +1.5%

-0.3% -0.6% +5.9%

3. New York

4. Idaho 5. Texas

9. New Mexico 10. Washington

+2.0% -0.8%

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