U.S. Dairy Cows Continue to Push Inland
The latest USDA Milk Production report released on Wednesday didn’t draw much change with a mere 0.8% increase in December’s milk production over the previous year, totaling 18.93 billion lbs. of milk. For the entire year, 2022 milk production grew by 0.2% over 2021.
Meanwhile, U.S. cow numbers documented growth, with 38,000 additional head compared to December 2021. This is still 9,000 fewer head compared to November 2022.
The revised November USDA production documented an increase of 1.1% more than the previous year with 17.4 billion lbs. This November revision represented a decrease of 49 million lbs., or 0.3% from last month’s preliminary production estimate.
A snapshot of the December report:
U.S. milk production: 18.93 billion lb., up 0.8%
U.S. cow numbers: 9.4 million, up 27,000 head
U.S. average milk per cow: 2,014 pounds, up 9 lbs.
24-state milk production: 18.125 billion lbs., up 0.9%
24-state cow numbers: 8.918 million, up 38,000 head
24-state average milk per cow: 2,024 pounds, up 8 lbs.
As revealed in the report, Texas led the way in year-over-year growth, up 25,000 head. This was followed by South Dakota with 16,000 additional cows, Iowa up 14,000 head and New York with an increase of 10,000 cows.
States that saw the biggest decline in cow numbers were New Mexico and Florida, both showing a decline of 13,000 head.
Phil Plourd, head of market intelligence at Ever.Ag, says that it was a little surprising to see the headline production number come in at less than 1%.
“Personally, I look at cow numbers first to see if the road to more milk is getting longer or shorter. This time around, USDA shortened the path, showing lower numbers for December and revising November lower for good measure,” he says. “I’d be more optimistic about growth at +40,000 cows year-over-year (where it looked like we were a few months ago) than +27,000 cows. We’ll continue to have growth, but it may be of the ‘medium’ variety. Texas and South Dakota remain at the top of the leaderboard in part because those areas feature recent or developing investments in processing capacity.”
Tanner Ehmke, a leading dairy economist with CoBank, says that with new cheese processing capacity coming online in the Texas Panhandle, that will add more tailwind to the herd growth in Texas.
“Same thing in South Dakota and all of these growth areas are cheese-producing states,” he says.
“All the milk is going to new cheese capacity. That's underpinning local prices and firming their basis.”
January 26, 2023