U.S. milk production is hesitating but inching higher.

The Agriculture Department’s latest preliminary data shows April output at 19.2 billion pounds, up just 0.3% from April 2022.

The 24-State total, at 18.4 billion pounds, was up 0.5% from a year ago. The March 50-State and 24-State totals were revised up 16 million pounds.

Cow numbers totaled 9.43 million, down 16,000 head from the March count, which was revised up 11,000. The herd was up 23,000 head from January and up 26,000 from a year ago.

The 24-State count was down 15,000 from the March number, which was revised 7,000 head lower, and 36,000 head above a year ago.

Output per cow averaged 2,037 pounds, up 1 pound or 0.05% from April 2022 in the 50 states, and up 2 pounds to 2,055 pounds, in the top 24 states.

HighGround Dairy points out “A big driver of the lower milk per cow nationally is smaller yields from California, which makes up around 18% of total U.S. milk output. March and April 2023 had dismal milk per cow numbers, down 2.1% and 1.9% year over year, respectively.”

StoneX adds: “As new crop hay becomes available and farm level feed costs shift lower we should see improved production per cow as we move through the year.”

California output, still recovering from weather in March, saw output drop to 3.5 billion pounds, down 69 million or 1.9% from a year ago, as output per cow was down 40 pounds. Cow numbers were unchanged.

Wisconsin output totaled 2.6 billion pounds, up 3 million pounds or 0.1% from a year ago, thanks to a 10-pound gain per cow offsetting the loss of 5,000 cows.

Texas output was up 1.3%, thanks to a 10-pound gain per cow. Cow numbers were up 5,000 from a year ago but were 15,000 lower than in March due to that devastating fire.

Idaho was up 2.7%, on 16,000 more cows and a 5-pound gain per cow. Michigan was up 2.6%, Minnesota up 1.5%, New Mexico down 3.1%, and New York was up 2.4%.

Oregon was down 1.3%, on a loss of 2,000 cows. Output per cow was up 5 pounds.

Pennsylvania was unchanged, South Dakota was up 7.7%, and Washington state was up 0.8%, thanks to a 30-pound gain per cow offsetting the loss of 2,000 cows.

Milk components were up from last year, adds StoneX, “so component-adjusted production was up 1.1%. While there may be some signs of stress on U.S. dairy farms, those revealed in this report are largely result of both problematic weather and a horrific fire, not necessarily financial. That will likely change this month and potentially result in more widespread contraction heading into the second half of 2023.”

Meanwhile, dairy culling is running ahead of year ago levels and likely to increase. The May 19 “Daily Dairy Report” warned that “milk revenue will be sharply lower soon. May Class III futures settled today at $16.19 and June touched a low of $15.80 before recovering to $16.06. Milk production costs vary widely, but there is hardly a dairy in the nation able to make milk for $16 today,” the DDR warned.

‘Whey’ down

Cash dairy prices are giving little hope, with whey grabbing particular attention. It closed 3.75 cents lower last week, at 26.50 cents per pound, lowest price since March 13, 2018, the second day it started trading at the CME at 26 cents per pound. Friday’s price was 24.25 cents below a year ago; 75 loads were sold last week, the highest weekly total since the week of Sept. 30, 2019.

The offers kept coming Monday and the whey fell to 25.50 cents per pound, down a penny, lowest price ever, with 7 sales on the board. It regained a half-cent Tuesday, inching back to 26 cents per pound, with 31 bids going unfilled.

China’s April whey imports were up 13.5% and up 43.8% year to date but not enough to absorb the increased U.S. whey stream resulting from large U.S. cheese output. The milk supply will grow even more as schools close for the summer.

Cheddar block cheese fell to $1.47 per pound last Monday, lowest price since June 9, 2021, then climbed back to $1.54 Wednesday, but closed Friday at $1.5350, up a half-cent on the week, ending seven weeks of decline, but 84.50 cents below a year ago.

The barrels fell to $1.4425 last Thursday, lowest since Sept. 7, 2021, but rallied to a Friday finish at $1.47, 2 cents lower on the week, 87.75 cents below a year ago, and 6.50 cents below the blocks. Sales totaled 35 cars of block and 54 of barrel.

The blocks jumped 6.50 cents Monday on 2 sales and added 5.25 cents Tuesday, rising to $1.6525 on 3 more sales, as traders await Wednesday afternoon’s April Cold Storage report.

The barrels were up 4.50 cents Monday on 11 trades, and were unchanged Tuesday, holding at $1.5150 on 8 more sales, 13.75 cents below the blocks.

Cheesemakers who supply regional chain and individually owned restaurateurs tell Dairy Market News that inflation has put pressure on those businesses. Retail cheesemakers report generally steady demand, in some cases year-over-year improvements. Milk availability is a growing concern. Spot milk prices remained as low as $11 under Class at mid-week, compared to $2.50 under Class to 75 cents over a year ago.

Retail and food service cheese demand remains strong to steady in the West. Export demand is mixed. Some contacts indicate good demand from Asia, Mexico, and South America, while others indicate lighter demand. Plentiful milk is keeping cheese production strong to steady, says DMN.

Butter closed Friday at $2.46 per pound, up 6 cents on the week but 39 cents below a year ago, with 9 sales on the board last week.

Monday’s butter saw a car sell for $2.4625 but an uncovered offer took it down a penny, and was offered 1.25 cents lower Tuesday, slipping to $2.4375.

Butter plants report atypical demand upticks as year-over-year reports are showing improvements in retail. Food service orders are seasonally in line to quieter. Cream is available and multiples are at similar levels to previous weeks. Some are turning cream away as they are at or near capacity.

Western cream is plentiful but cream multiples moved higher last week. Planned equipment maintenance caused a few butter plants to reduce cream intake. Some report output is limited due to personnel shortages. Retail and food service butter demand is strong to steady and export demand is steady.

Grade A nonfat dry milk fell to $1.1525 per pound last Thursday and stayed there Friday, lowest since April 18, 1.75 cents lower on the week, and 64.75 cents below a year ago, with 9 sales reported.

The powder was up 0.75 cents Monday on 2 trades but gave it back Tuesday, returning to $1.1525 on 8 offers.

Class I drops $1.56

The June Federal order Class I base milk price was announced at $18.01 per hundredweight, down $1.56 from May, $7.86 below June 2022, and the lowest Class I since November 2021. It equates to $1.55 per gallon, down from $2.22 a year ago. The six month average stands at $19.77, down from $23.32 a year ago and compares to $16.13 in 2021.

Fluid sales down 0.7%

Fluid milk sales looked a little better in March but were still down from a year ago. The latest data shows packaged fluid sales totaled 3.8 billion pounds, down just 0.7% from March 2022, following a 3.2% drop in February 

Conventional product sales totaled 3.5 billion pounds, down 0.9% from a year ago. Organic products, at 256 million pounds, were up 1.3%, and represented 6.8% of total sales for the month.

Whole milk sales were up 2.1% from a year ago, up 1.1% year to date, and represented 34.3% of total milk sales for the three months.

Skim milk sales were down 6.2% from a year ago and down 6.8% year to date.

Total packaged fluid sales for the three months amounted to 10.9 billion pounds, down 1.4% from 2022. Conventional product sales totaled 10.2 billion pounds, down 1.6%. Organic products, at 732 million pounds, were up 1.1%.

Pulse down again

Tuesday’s GDT Pulse saw 2.2 million pounds of Fonterra whole milk powder sold, same as May 9, but at $3,150 per metric ton, down $25 from the last Pulse but down $45 from the May 16 GDT.

HighGround Dairy says “WMP prices dipped again after edging upwards at the previous GDT Auction. Demand remains volatile but has yet to overcome abundant stocks to push prices higher.”