Producers cut back in response to unprofitable milk prices

By CAROL RYAN DUMAS
Capital Press

Fewer cows and cheaper feed in response to low milk prices is reducing milk production in Idaho, said Wilson Gray, University of Idaho extension economist in Twin Falls.

Idaho milk production totaled 1.04 billion pounds in June, a 0.9 percent decrease from the same month last year, and down 1.7 percent from May, according to the National Agricultural Statistics Service.

Average milk production per cow in June was down 20 pounds from June 2008. The average number of milk cows during June was down 1,000 head from the revised May 2009 numbers, but up 1,000 head from June 2008.

"We're retreating some in Idaho," Gray said.

Five or six Idaho producers retired their herds through the spring Cooperatives Working Together spring program, he said. Gray suspects those were medium or small operations.

May milk production was revised to 1.06 billion pounds, up 9 million pounds from the preliminary level. But overall production and production per cow dropped in June.

"It's mostly (due to) feed. Through the end of June, the weather's been pretty good," Gray said.

Another factor affecting production is that fewer herds are using rBST growth hormone, which increases milk production.

"Glanbia producers had to be off it by the end of April," he said.

Glanbia Foods Inc., based in Twin Falls, has four locations in the Magic Valley that process cheese and whey. According to information from the company, it produces more than 12 million pounds of milk daily and produces more than 400 million pounds of cheese and 110 million pounds of other dairy ingredients a year.

Glanbia Foods is a subsidiary of Glanbia plc, an international food and ingredient company based in Ireland.

As for herd numbers, the strong growth of 2007 and 2008 has stopped, he said.

"Basically, we built up, and then things have pretty much halted," Gray said. "We got up to 556,000 head in ( July 2009). We gained 22,000 in six months. Then the high cost of feed hit. Any margins they had disappeared and it stopped expansion. We've been losing numbers a little bit since then."

In January 2008, the herd was pegged at 534,000. September 2008 through January 2009, the herd held steady at about 554,000. Then it started going down again to June's 552,000.

Nationwide, the herd number is down in response to milk prices, not so much in response to CWT, which some had hoped would be better, Gray said.

"We're down fifty-some thousand head. People kept cows or added and it offset that (CWT reduction) some," he said.

The number of milk cows on farms was 8.44 million head, 56,000 head less than June 2008, and 29,000 head less than May 2009.

Gray said he expects to see more reduction with the next report, which will revise June numbers.

"But I doubt we're going to see a 10,000 cow difference for awhile," he said.

Milk production in the 23 major milk-producing states during June totaled 14.7 billion pounds, down 0.1 percent from June 2008. May revised production at 15.5 billion pounds, was up 0.5 percent from May 2008. The May revision represented an increase of 46 million pounds or 0.3 percent from last month's preliminary production estimate.

Production per cow averaged 1,746 pounds for June, 10 pounds above June 2008.

Staff writer Carol Ryan Dumas is based in Twin Falls. E-mail: crdumas@capitalpress.com.

Online

USDA-NASS: www.nass.usda.gov

CWT: www.cwt.coop

Idaho milk production

June May June 2008

Milk 1.04 billion lbs. 1.06 billion lbs. 1.05 billion lbs.

Milk per cow 1,880 lbs. 1,900 lbs. 1,900 lbs.

Cows 552,000 553,000 551,000

U.S. milk production

June May June 2008

Milk 14.7 billion lbs. 15.5 billion lbs. 14.7 billion lbs

Milk per cow 1,746 lbs. 1,737 lbs. 1,736 lbs.

Cows 8.44 million 8.50 million 8.46 million

SOURCE: USDA-NASS