USDA projects slower input per cow in 2023

MIELKE, from pg. 13 moved higher this week. Planned equipment maintenance in June caused a few butter plants to reduce their 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 on May 18 and stayed there. The price is the lowest since April 18, 1.75 cents lower on the week, and 64.75 cents below a year ago, with nine sales reported.

Dry whey closed 3.75 cents lower on the week, at 26.5 cents per pound. This is the lowest price since March 13, 2018, the second day whey started trading at the CME, and is 24.25 cents below a year ago. 75 loads were sold on the week, highest weekly total since the week of Sept. 30, 2019.

The U.S. Department of Agriculture lowered its 2023 milk production estimate in its latest World Agricultural Supply and Demand Estimates report, citing a larger expected cow inventory but slower output per cow. The report also gave a look at 2034. 2023 production and marketings were estimated at 228.6 and 227.6 billion pounds respectively, down 100 million pounds on production from a month ago, but unchanged on marketings. If realized, 2023 production would be up 2.1 billion pounds or 0.93 percent from 2022.

2024 production and marketings were estimated at 230.8 and 229.8 billion pounds respectively, up 2.2 billion pounds on both from 2023. If realized, 2024 production would be up 0.96 percent from 2023 and marketings would be up 0.97 percent.

Based on expected changes in component prices, 2023 Class III milk prices were lowered while Class IV prices were raised. The Class III average was projected at $17.75 per hundredweight, down 50 cents from last month’s estimate, and compares to $21.96 in 2022 and $17.08 in 2021. The 2024 average was projected at $17.50.

The 2023 Class IV average was estimated at $18.30, up 20 cents from a month ago, and compares to $24.47 in 2022 and $16.09 in 2021. The 2024 average is projected at $17.35.

The 2024 milk estimate was driven by gains in milk per cow and an additional milking day, according to the WASDE. The Class III price was forecast lower on weaker whey prices. The Class IV was forecast lower as well, with prices for butter and non-fat dry milk projected lower.

This month’s corn outlook is for larger production, greater domestic use and exports, and higher ending stocks. The corn crop was projected at a record 15.3 billion bushels, up more than 10 percent from last year on increases to both area and yield. The yield projection is 181.5 bushels per acre.

Meanwhile, U.S. corn planting was at 65 percent as of the week ending May 14, according to the USDA’s latest Crop Progress report. That’s up from 49 percent the previous week, 20 percent ahead of a year ago, and 6 percent ahead of the five-year average. Thirty percent was emerged, up from 12 percent the previous week, 17 percent ahead of the previous year, and 5 percent ahead of the five-year average.

Soybeans were at 49 percent planted, up from 35 percent the week before, 22 percent ahead of a year ago, and 13 percent ahead of the five-year average. Twenty percent are emerged, 12 percent ahead of a year ago and 9 percent ahead of the five-year average.

The week ending May 6 saw 57,100 dairy cows head to slaughter, down 1,700 from the previous week but 800 head or 1.4 percent more than a year ago. Year to date, 1.17 million head have been culled, up 51,300 or 4.5 percent above a year ago.

Checking demand, March butter disappearance totaled 219.5 million pounds, up 19.4 percent from February and 15.2 percent above March 2022. HighGround Dairy credits “substantial domestic demand, possibly due to an earlier Easter in 2023.”

The butter was a “beacon of hope,” said HighGround Dairy contributing dairy economist Betty Berning in the May 22 “Dairy Radio Now” broadcast.

See MIELKE, pg. 15