California’s output totaled 3.5 billion pounds, down 68 million pounds, or 1.9%, from a year ago, thanks to a 40-pound drop per cow. Cow numbers were unchanged.

Wisconsin output totaled 2.7 billion pounds, down 8 million, or 0.3%. Cow numbers were up 11,000, but output per cow was down 25 pounds.

Idaho was up 0.6% on 4,000 more cows. Output per cow was unchanged.

Michigan was down 3.5% on 10,000 fewer cows and a 30-pound drop per cow. Minnesota was down 1.0% on a 25-pound drop per cow, though cow numbers were up 1,000. New Mexico output plunged 12.1% on a drop of 42,000 cows, although output per cow was up 10 pounds.

New York was off 0.6% on 5,000 fewer cows, though output per cow was up 5 pounds.

Oregon was down 1.4% on a 10-pound drop per cow and 1,000 fewer cows.

Pennsylvania was down 2.9%, on 6,000 fewer cows and 30 pounds less per cow. South Dakota was up 18.3%, thanks to 28,000 more cows offsetting a 20 pound drop per cow. Texas was up 3.5% on 12,000 more cows and a 35 pound gain per cow.

Washington state was down 7.1% on a loss of 17,000 cows and 20 pounds less per cow.

Culling falls

Dairy cow culling was down from December and from a year ago, according to USDA’s latest Livestock Slaughter report.

An estimated 260,800 head were sent to slaughter under federal inspection in January, down 7,000 from December, and 16,500 head or 6.0% below Jan 2021.

Butter shows good demand

U.S. butter stocks grew in January but at a slower than normal rate and well below those of a year ago, according to the Agriculture Department’s latest Cold Storage report.

The Jan. 31 butter inventory stood at 221.3 million pounds, up 22.3 million pounds or 11.2% from December, reversing six months of declines, but were down 110.6 million pounds or 33.3% below those in January 2021, the fourth consecutive month to fall short of a year ago.

Cheese inventories also grew by less-than-typical margins. American type cheese fell 4.1 million pounds or 0.5% from the December level, which was revised down 3.4 million pounds, but were 29.7 million pounds or 3.7% above a year ago.

The “other” cheese category grew to 583.2 million pounds, up 6.4 million or 1.1% from December, and 5.4 million pounds or 0.9% above a year ago.

The total cheese inventory inched up to 1.445 billion pounds, up 3.9 million pounds or 0.3% from December, setting a new all-time high for total stocks, and were 37.3 million pounds or 2.6% above a year ago.

GDT soars

World markets are volatile, to say the least, as hopes of an end to Russia’s invasion into Ukraine die by the hour. The weighted average at Tuesday’s Global Dairy Trade auction was up 5.1%, the biggest boost since the 15.0% pole vault on March 2, 2021, and the fifth consecutive session of gain.

Traders brought 55.6 million pounds of product to the market, down from 61.1 million on Feb. 15, the lowest since Sept. 21, 2021, but the average metric ton price climbed to a record $5,065 U.S., the highest since Feb. 14, 2014.

Cheddar led the way, up 10.9%, following a 3.5% rise on Feb. 15. Butter followed, up 5.9%, after rising 5.1% last time.

Buttermilk powder was up 5.8%, and whole milk powder was up 5.7%, after advancing 4.2% in the last event.

Skim milk powder was up 4.7, following a 6.0% jump. Anhydrous milkfat was up 2.1%, following a 1.2% rise, and lactose was up 0.9%.

StoneX Dairy Group says the GDT 80% butterfat butter price equates to $3.1359 per pound U.S., up 17.7 cents, after jumping 14.5 cents on Feb. 15, and compares to CME butter, which closed Tuesday at a steal of $2.6925.

GDT Cheddar, at $2.9002, was up 23.3 cents, after gaining 8.9 cents on Feb. 15 and compares to Tuesday’s CME block Cheddar at $2.03. GDT skim milk powder averaged $2.0328 per pound, up from $1.9482.

Whole milk powder averaged $2.1578 per pound, up from $2.0424. CME Grade A nonfat dry milk closed Tuesday at $1.86 per pound.

CME slip stalls

Driven by bullish Milk Production and Cold Storage reports and perhaps the invasion, cash dairy prices in the President’s Day Holiday-shortened week moved higher, then relapsed.

The Cheddar blocks climbed to $2.0175 per pound last Thursday but closed Friday at $1.9450, down 4.25 cents on the week, while 32.75 cents above a year ago.

The barrels got to $1.9550 last Tuesday but finished at $1.90, down 3.50 cents on the week, 48 cents above a year ago, and 4.50 cents below the blocks. There were 4 sales of block reported on the week at the CME and 6 of barrel.

The blocks jumped 4.50 cents Monday, with 2 cars exchanging hands, and perhaps fueled by the morning’s GDT, a sale took the blocks up 4 cents Tuesday, to $2.03 per pound.

The barrels were up 3.50 cents Monday, also with 2 cars being traded, but were unchanged Tuesday, holding at $1.9350, with 7 loads finding new homes.

The DFMA reported that “foodservice sales in the U.S. are surging with the end of mask mandates. In the latest seven-day period, restaurant firm “OpenTable” reported total restaurant traffic was up 1.4% versus pre-pandemic levels, which was the best weekly performance since September and a stark improvement from early January when restaurant traffic decreased by 30%.”

Dairy Market News says Midwest cheese plants continue to undergo operational updates and maintenance, which resulted in less cheese production. Plants are performing updates now because of laborer shortages and higher production costs. Cheese inventories are balanced to available and customer orders are more analogous to pre-COVID years.

Western cheesemakers say export demand is strong as loads are being sold at lower prices than those from other countries.

Domestic cheese interest is “more muted,” says DMN, as retail demand is steady to lower. In some parts of the West warmer weather and loosening COVID restrictions have led to an uptick in food service demand. A shortage of truck drivers was causing delays, while port congestion is further delaying exports. Cheese output is steady though some plants say labor shortages and delayed deliveries of production supplies continue to cause them to run below capacity.

Cash butter closed Friday at $2.5875 per pound, 10.25 cents lower on the week but still $1.1175 above a year ago, with 15 sales reported.

Monday’s butter gained 4.25 cents, then added 6.25 cents Tuesday, climbing back to $2.6925.

Central butter demand remains a little softer but churning is ongoing at as brisk a pace as possible, due to labor and driver shortages. Cream availability is steady or more available, compared to previous weeks.

Cream inventories are reportedly beginning to tighten in the West as demand is steady. Some plants report cream inventories are short, as bad weather and a shortage of truck drivers caused delays. Loosening COVID restrictions are leading to higher food service demand though retail demand is softening, according to DMN.

Grade A nonfat dry milk climbed to $1.8750 last Thursday but closed Friday at $1.86, up a penny on the week and 72.75 cents above a year ago, with 27 loads sold.

The powder lost a penny Monday, then got it back Tuesday, returning to $1.86.

Dry whey closed Friday at 78 cents per pound, down 3 cents on the week, lowest since Jan. 14, but 22.25 cents above a year ago, with 4 sales reported on the week.

The whey lost 2 cents Monday and inched down another 0.75 cents Tuesday, to 75.25 cents per pound, lowest since Dec. 31, 2021.

Margin tops year ago

A higher January All Milk Price offset higher corn and soybean prices to push the January milk feed ratio higher for the fifth month in a row and top the year ago ratio for the first time since October 2020. The USDA’s latest Ag Prices report shows the ratio at 2.18, up from 1.98 in December, and compares to 2.00 in Jan. 2021.

The U.S. All Milk Price averaged $24.20 per cwt., up $2.40 from December, and $6.70 above Jan. 2021.

The national average corn price jumped to $5.57 per bushel, up a dime from the December price and was $1.33 per bushel above Jan. 2021.

Soybeans averaged $12.90 per bushel, up 40 cents from December and $2 per bushel above Jan. 2021.

Alfalfa hay averaged $211 per ton, down $2 from December, but $43 per ton above a year ago.

The January cull price for beef and dairy combined averaged $71.60 per cwt., up $12.50 from December, $11.90 above Jan. 2021, and dead even with the 2011 base average.

Based on his latest estimates, dairy economist Bill Brooks, of Stoneheart Consulting in Dearborn, Mo., does not see any Dairy Margin Coverage payment for the remainder of 2022.