U.S. dairy cows are putting less milk in the tank and bird flu may be part of the problem. The agriculture department’s preliminary data showed May output at 19.68 billion pounds, down 0.9 percent from May 2023, the 11th consecutive month output fell short of a year ago.

The 24-state production, at 18.9 billion pounds, was down 0.7 percent. April output in the 50 states was revised down 40 million pounds, down 0.6 percent from a year ago, instead of the 0.4 percent decline originally reported. The 24-state total was revised 27 million pounds lower, down 0.4 percent, not the 0.2 percent reported.

May cow numbers totaled 9.35 million, up 27,000 head since January and up 5,000 from the April count, which was revised up 5,000 head, but was 68,000 or 0.7 percent below May 2023. The 24-state count, at 8.893 million, was up 5,000 from April but 52,000 below a year ago. The April count was revised up 2,000 head.

Output per cow in the 50 states averaged 2,105 pounds, down 3 pounds or 0.1 percent from a year ago. The 24-state average, at 2,122 pounds, was down 3 pounds. April output per cow was revised down 6 and 3 pounds respectively. California production was down 55 million pounds or 1.5 percent from a year ago.

Cow numbers were down 6,000 head and output per cow was down 25 pounds. That 55-million-pound drop was almost a third of the total drop in the nation’s milk production, according to HighGround Dairy economist Betty Berning in the July 1 “Dairy Radio Now” broadcast. Wisconsin output was up 30 million pounds or 1.1 percent from a year ago, thanks to a 20-pound gain per cow and 2,000 additional cows. Idaho was off 0.6 percent, on 1,000 fewer cows and 10 pounds less put per cow. Michigan was up 0.1 percent. Cow numbers were up 2,000 and outweighed a 10-pound drop per cow. Both states are dealing with avian flu.

Minnesota was down 0.6 percent on 8,000 fewer cows but output per cow was up 25 pounds. New York was off 0.2 percent on a 5-pound drop per cow. Cow numbers were unchanged. New Mexico again posted the biggest loss, down 14.7 percent, on a drop of 42,000 cows, although output per cow was up 10 pounds. Oregon was down 3.1 percent, on 4,000 fewer cows. Output per cow was unchanged. Pennsylvania was off 0.9 percent on a 15-pound drop per cow and 1,000 fewer cows. South Dakota showed the biggest gain, up 10.2 percent, thanks to 19,000 more cows and a 5-pound gain per cow. Texas was only down 0.3 percent and appears to be rebuilding its herd despite the fire and the avian influenza. Cow numbers were only down 2,000 head and output per cow was unchanged.

Vermont was down 3.6 percent, on 3,000 fewer cows and a 20-pound drop per cow. Washington was up 0.9 percent on 2,000 more cows and a 5-pound gain per cow. 

Dairy cows are staying in the herd longer. Cow slaughter for the week ending June 15 totaled 47,600 head, up 1,000 from the previous week but 10,100 or 17.5 percent below a year ago. Year to date, 1,297,400 head have been culled, down 208,400 or 13.8 percent from 2023. U.S. butter stocks grew some more in May but not as much as expected.

The USDA’s latest Cold Storage report shows the May 31 inventory at 380.2 million pounds, up 18.1 million or 5.0 percent from the April count, which was revised up 741,000 pounds, and was up 12.4 million pounds or 3.4 percent from May 2023. American type cheese stocks fell to 821.0 million pounds, down 4.5 million or 0.5 percent from the April level, which was revised 13.7 million pounds lower, and were down 36.0 million pounds or 4.2 percent from a year ago.

The “other” cheese category holdings crept up to 599.9 million pounds, up 4.0 million or 0.7 percent from April’s count, which was revised 2.5 million pounds lower. Stocks were down 16.5 million pounds or 2.7 percent from a year ago. The total May 31 cheese inventory slipped to 1.442 billion pounds, down 720,000 pounds from the April count, which was revised 16.3 million pounds lower, and was 55.1 million pounds or 3.7 percent below a year ago.

The report is viewed as bullish for both butter and cheese. StoneX Dairy Group stated: “To get butter stocks down to this level, domestic demand must have bounced back a bit after being flat in February, March, and April.” They also reported “This is the second largest year over year decline in cheese stocks for May that we’ve seen since 2006. The only larger decline was 2014.”

HighGround’s Betty Berning said the butter stock growth from April to May was at the slowest rate between the two months since 2020 (COVID-19 year) and 2013. She said the five-year average build from April to May (excluding 2020) was 27.5 million pounds, making the 2024 increase 38 percent below average. Cash dairy prices were mixed in the final week of June, as traders anticipated the July 4th holiday.

After dropping 12.5 cents the previous week, the Cheddar blocks closed the month of June at $1.91 per pound, up 6.50 cents on the week, 2 cents below their June 3 perch, but 57.50 cents above a year ago. The barrels closed Friday at $1.88 per pound, 4 cents lower on the week down 8 cents on the month, 53.50 cents above a year ago when they plunged15.50 cents, and a typical 3 cents below the blocks. Sales totaled seven loads of block on the week and 71 for the month of June, down from 92 loads in May. Barrel sales amounted to five on the week and 55 for the month, up from 51 in May.

Midwest cheesemakers report mixed takes on demand in recent weeks, according to Dairy Market News. Some are turning away new orders as they are booked solid. Others say summer demand is meeting expectations but has slowed from a busy late spring season. Cheese production remains steady in the region, but cheesemakers and milk handlers were in preparing for the 4th.

Milk handlers are concerned that the Thursday holiday will keep some cheese lines down for a potential four-day weekend. On the other hand, some cheesemakers are holding off on purchasing extra spot milk. “Cheese markets are not bullish or bearish, but indecisive,” says DMN.

Retail demand for cheese in the West picked up ahead of the holiday and contacts anticipate increased food service sales during the summer months. Export cheese demand is steady, though some traders say current prices are not competitive with internationally produced loads. Cheese is available but inventories are not excessive.