Analysis US milk supply
Americans are milking heavily in the corona crisis
The American milk supply for September and October follows the same line as last year, but is aiming higher. A somewhat striking development, since the still ongoing corona crisis has prevented the dairy market from offering optimal sales channels this spring.
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The milk supply in September and October is therefore parallel to that of last year, only at a higher level. More than 7,8 million tons were produced in September, 2,4% more than a year earlier. In October, American dairy farmers produced 2,5% more milk than in October 2019 with a total of more than 8 million tons of milk. Compared to the 5-year average, the current milk supply trend is significantly higher.
Corona and milk price
Given the ongoing corona crisis, it is striking that milk production is increasing so sharply. This spring, a large number of dairy farmers had to let their milk run away because there was no processing capacity available. At the moment, the dairy market has still not fully recovered. What probably helps is that the US is not completely locked down, something most states do not want again.
Although the milk price is not at its best, the price is probably a reason to increase production. Dairy farmers who produce milk for the Class III price have the most favorable price. In October they earned €40,46 per 100 kilos of milk, an increase of more than 31% compared to September. Dairy farmers with Class II have to make do with only €25,52 per 100 kilos of milk and the Class IV is even lower at €25,22 per 100 kilos of milk. Both prices are on the rise again in October.
More cows, more milk
In addition to the increased milk supply, the dairy herd in the US has also been scaled up. In October, the 24 largest dairy states had as many as 8,88 million animals. This is 62.000 more than in October 2019 and even 17.000 more than in September of this year. The total of dairy cattle in all states is about 9,39 animals higher than in October 43.000, at 2019 million cows.
With more cows it is logical that the milk supply will increase. Additionally, these dairy cows have also started to produce more milk per cow on average. In the 24 major dairy states, the average production per cow in October was more than 900 kilos, about 15 kilos more than in the previous year.