U.S. milk production showed a little recovery, according to the Agriculture Department’s latest preliminary data. August output totaled 18.8 billion pounds, down just 0.1 percent from August 2023, the 14th consecutive month output was below a year ago, but barely. The 24-state output, at 18.1 billion pounds, was up 0.1 percent.

July output in the 50 states was unchanged from last month’s report while the 24-state total was reduced 1 million pounds, down 0.3 percent from a year ago, instead of the 0.2 percent decline originally reported.

The Sept. 20 “Daily Dairy Report” points out, “Milk output in August 2023 was 1 percent lower than the year before. Continued improvements in milk component levels suggest that dairy processors will have more dairy nutrients to work with than they did in August 2023.”

August 2024 cow numbers totaled 9.325 million head, unchanged from the July count which saw no revision, but was 40,000 head or 0.4 percent below August 2023. The 24-state count, at 8.878 million head, was also unchanged from July but 28,000 head or 0.3 percent below a year ago as U.S. farmers cull less and keep cows in the string longer due the high cost of replacements, if you can find them.

August output per cow in the 50 states averaged 2,018 pounds, up 8 pounds or 0.4 percent from a year ago. The 24-state average, at 2,036 pounds, was up 8 pounds or 0.4 percent from a year ago.

“States that had bird flu early have fully recovered,” says StoneX, “With output per cow back above a year ago in Texas, New Mexico, Michigan, and Idaho. Output per cow improved in Colorado, hit hard in June and July, but it started spreading in California in mid to late August.” The Number one milk producer had 34 cases confirmed as of Sept. 20, which will likely be reflected in the September report.

California’s August production was up 67 million pounds or 2.0 percent from a year ago, thanks to a 45 pound gain per cow offsetting a drop of 5,000 cows. That’s the biggest increase in two years and more than offset Wisconsin’s drop of 64 million pounds, down 2.3 percent from a year ago, due to a 45-pound drop per cow and 3,000 fewer cows.

Arizona was down 6.5 percent, on a 12,000-cow drop and 10 pounds less per cow. Idaho was up 0.3 percent on 1,000 more cows and a 5-pound gain per cow.

Michigan was off 0.3 percent on 3,000 fewer cows but output per cow was up 10 pounds. Colorado output was unchanged from a year ago, despite a 20-pound loss per cow. Cow numbers were up 2,000 head.

Minnesota was down 2.8 percent on 8,000 fewer cows and 20 pounds less per cow. New York was down 1.2 percent on a 25-pound drop per cow. Cow numbers were unchanged.

New Mexico posted the biggest loss, down 11.3 percent, on a drop of 31,000 cows, although output per cow was up 5 pounds. Oregon was down 1.4 percent on 2,000 fewer cows, though output per cow was up 5 pounds. Pennsylvania was down 2.0 percent on 1,000 fewer cows and 30 pounds less per cow.

South Dakota posted the biggest increase, up 8.5 percent, thanks to 16,000 more cows, and 5 pounds more per cow. Texans put 7.8 percent more milk in the tank than a year ago and 20,000 more cows in the parlor, and they gave an extra 95 pounds per cow.

Vermont was down 5.1 percent, on 4,000 fewer cows and a 30-pound drop per cow. Washington State output was up 1.3 percent on 3,000 more cows. Output per cow was up 5 pounds.

Meanwhile, dairy cow slaughter is running about 14 percent below a year ago. The week ending Sept. 14 saw 51,300 head culled, up 3,600 from the previous week, but 5,600 or 9.8 percent below a year ago. Year to date, 1,945,400 dairy cows had been culled, down 317,300 head or 14.0 percent from 2023.

“Milk production is still underwhelming,” said StoneX broker Dave Kurzawski in the Sept. 30 “Dairy Radio Now” broadcast. Milk production is getting tighter in California as bird flu spreads and that’s where 18 percent of U.S. milk is produced, and 50 percent of 2023 nonfat dry milk was manufactured there “so it’s a big issue.”

Meanwhile CME butter and cheese prices climbed, hitting record highs in the case of barrel cheese, but have since reversed direction. Buyers kept purchasing at the elevated prices, he said, but they now have what they need.

Butter at $2.50 a pound is still a great price, according to Kurzawski, even though it’s down significantly from the 2024 highs. Barrel cheese hit a record high but “that initial pinch is behind us,” he said.

He believes cheese is still tight, as year-to-date output is about 8 percent less than a year ago. Buyers step away from the high prices and an extra load may feel like 20, he said. “They have to bring the price down. We’re in the midst of trying to figure out where that bid comes in.” He predicts cheese will be north of $2 through the end of the year “but we may have some big downward corrections.”

Butter and cheese stocks slipped in August. The USDA’s latest Cold Storage report showed Aug. 31 butter holdings at 323.3 million pounds, down 29.5 million pounds or 8.4 percent from the July count, which was revised down 1 million pounds, but were up 31.5 million pounds or 10.8 percent from August 2023. 

American type cheese stocks grew to 799.9 million pounds, up 8.5 million or 1.1 percent from the July level, which was revised 2.6 million pounds lower, but were down 53 million pounds or 6.2 percent from a year ago.

The “other” cheese category, at 577.9 million pounds, was down 11.7 million pounds or 2.0 percent from July’s count, which was revised 900,000 pounds lower and was down 42.0 million pounds or 6.8 percent from a year ago.

The total Aug. 31 cheese inventory slipped to 1.4 billion pounds, down 3.1 million pounds or 0.2 percent from July and was 95.1 million pounds or 6.4 percent below a year ago.

China’s dairy imports were down in August, dropping 3.7 percent, according to HighGround Dairy, which put the year-to-date number down 13 percent. New Zealand saw the biggest losses, says HGD, while the EU and U.S. saw some gains.

Imports of whole milk powder (WMP) and skim milk powder (SMP) slumped dramatically, down 31.7 percent and 23.5 percent respectively. HGD says “This is the smallest volume of WMP imported in 2024, the smallest since October ’23.”

Whey imports were up 26.5 percent, with imports from the U.S. making up 39.8 percent, a 39.8 percent increase from a year ago.

Butter imports, at 14.7 million pounds, were down 22.3 percent, though year to date are up 5.6 percent. Cheese totaled 31 million pounds, down 20.1 percent, and down 4.2 percent YTD.

Tuesday’s Global Dairy Trade Pulse saw 4.8 million pounds of product sold, down from 4.9 million in the last Pulse.