Dairy | Will More Money in Dairy Producer’s Pocketbook Eventually Spell More Milk?

The latest USDA Milk Production report for August illustrated an increase of 0.1% from the year prior.

The latest USDA Milk Production report for August illustrated an increase of 0.1% from the year prior. Despite this slight uptick, the dairy industry landscape presents a mixed bag as we move into September.

For August, milk production showed a modest increase from the same period in the previous year. Specifically, the revised production for July stood at 18.2 billion lbs., representing a decrease of just 1 million lbs. or less than 0.1% from the preliminary production estimate released last month. The average production per cow in the 24 major States hit 2,036 lbs. for August, which is 8 lbs. more than August 2023.

Phil Plourd, president of Ever.Ag Insights, offers some perspective on these numbers. He highlights that the production gap seemed to narrow in August, likely due to less severe weather and diminished Highly Pathogenic Avian Influenza (HPAI) infections in some critical areas.

“However, the upward momentum could be slowing here in September now that HPAI is in California – ironically, one of the states that led the way higher in August,” Plourd stated, noting that California was up 2.0% year-over-year. Other states that led with positive growth from the year prior included South Dakota, up 8.5%, and Texas, up 7.8%. New Mexico showed the biggest decline, down 11.3% year-over-year.

Future Projections and Economic Implications

Looking ahead, Plourd highlighted the importance of monitoring the financial outlook for farms. He noted, “Beyond that, going forward, we’re keen to see how much a radically improved farm financial outlook matters. In other words, will more money mean more milk?”

As the dairy industry navigates through these fluctuations, the relationship between environmental conditions, disease outbreaks, and economic factors will likely continue to play a crucial role in shaping production trends. Keeping a close watch on these elements will be essential for dairy stakeholders.

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Topics |
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