tag:blogger.com,1999:blog-70713181376796749762024-03-18T14:26:39.843-04:00MilkPriceThe MilkPrice blog follows producer pricing in the USA with an emphasis on the Federal Milk Marketing Orders that pay on components and make up over 50% of the U.S. milk. Items analyzed include cheese, butter, and dry whey prices and the factors that influence their pricing such as inventories, production, exports and imports, exchange rates, and domestic consumption. The analysis has an emphasis on easy to follow trend charts and graphs.John Geusshttp://www.blogger.com/profile/07787141554094420499noreply@blogger.comBlogger407125tag:blogger.com,1999:blog-7071318137679674976.post-92050267616264576702024-03-11T20:44:00.003-04:002024-03-11T20:47:09.386-04:002023 Butter and Cheese Exports are Down n 2023 butter and cheese exports were down from 2022. This post will cover some of the details behind these decreases. Butter exports have always been minimal as the supply is limited. Imports of butter are much bigger than exports and the butter imports are growing. Cheese exports John Geusshttp://www.blogger.com/profile/07787141554094420499noreply@blogger.com0tag:blogger.com,1999:blog-7071318137679674976.post-76691977615114004702024-03-03T08:53:00.003-05:002024-03-03T08:53:45.843-05:00What Dairy Products is the Consumer Buying? The U.S. dairy industry is huge. Including producers, processors, and retailers, dairy is a very big business. In the end, the consumer satisfaction is key to success. This post will cover retail pricing trends and consumer purchases of the major dairy products, butter, cheddar cheese, and fluid milk. Fluid milk will be covered first as it has the largest price John Geusshttp://www.blogger.com/profile/07787141554094420499noreply@blogger.com0tag:blogger.com,1999:blog-7071318137679674976.post-28535392993230869012024-02-25T15:32:00.007-05:002024-02-26T19:13:57.927-05:00More on Low Protein PricesIn the prior post, information and charts were used to show why milk protein values are low and will likely stay low. Milk protein pricing is based on butterfat and Cheddar cheese prices. Butterfat is high priced and cheese is low priced. Based in the USDA formulas, milk protein was valued at only $1.13 per pound. Readers asked many questions about where milk protein John Geusshttp://www.blogger.com/profile/07787141554094420499noreply@blogger.com0tag:blogger.com,1999:blog-7071318137679674976.post-86458903319352832042024-02-13T10:45:00.004-05:002024-03-06T14:47:12.416-05:00Butterfat Prices are High and Protein Prices are Low. When Will it Change?Butterfat has become the most important component in milk pricing. In January 2024, the value of butterfat made up nearly 70% of the FMMO Class III price. Is this a short-term event or will this pricing pattern continue? This post will review long-term component pricing trends and other factors impacting the current pricing.Chart I below shows the breakdown of Class III pricing John Geusshttp://www.blogger.com/profile/07787141554094420499noreply@blogger.com0tag:blogger.com,1999:blog-7071318137679674976.post-78664817902940913342024-02-04T16:02:00.009-05:002024-02-04T18:23:03.550-05:00What Happens if the "Make Allowance" Changes Proposed by IDFA are implemented? The International Dairy Foods Association (IDFA) has suggested major changes to the pricing of producer milk. The most impactful part is a major change in the "make allowances" in the Federal Order formulas. The make allowances were changed three times in 2007 and 2008. Those changes were analyzed in a post to this blog in August 2009. The 2009 blog is worth reading. John Geusshttp://www.blogger.com/profile/07787141554094420499noreply@blogger.com0tag:blogger.com,1999:blog-7071318137679674976.post-65460059596085148172024-01-21T16:32:00.002-05:002024-01-21T16:35:57.460-05:00What 2023 Momentum will influence 2024 Dairy Prices?Producers get paid primarily for their components. The prices of components, published by the Agricultural Marketing Services (AMS), are really indexes based on standardized levels of components as they were in the year 2000 when the current payment system was established. Over 24 years, there have been some significant changes in productivity. See this recent popularJohn Geusshttp://www.blogger.com/profile/07787141554094420499noreply@blogger.com0tag:blogger.com,1999:blog-7071318137679674976.post-81588695488215821722024-01-07T18:16:00.001-05:002024-01-07T18:27:07.560-05:00Walmart's new Georgia Milk Plant Will Change Dairy in the Southeast.Walmart built a fluid milk processing plant in Fort Wayne, Indiana in 2018 to produce their "Great Value" fluid milk for the Walmart stores and "Member's Mark" fluid milk for Sam's Club. The new plant provided significant capacity and low-cost production. The raw milk is delivered to the plant from nearby large producers. The finished product is delivered by Walmart's own fleet John Geusshttp://www.blogger.com/profile/07787141554094420499noreply@blogger.com0tag:blogger.com,1999:blog-7071318137679674976.post-80911578438053573852023-12-10T20:29:00.016-05:002023-12-17T23:09:17.940-05:00Annual Per Capita Consumption of Dairy ProductsAt the end of November each year a report on per capita dairy consumption is compiled based on data from the USDA, Agricultural Marketing Service, and others. The report is an annual compilation through the prior year, in this case, 2022.This post will cover the long-term growth or decline of major consumer dairy products which includes cheese, fluid milk, butter, yogurt, and ice cream.MostJohn Geusshttp://www.blogger.com/profile/07787141554094420499noreply@blogger.com0tag:blogger.com,1999:blog-7071318137679674976.post-59079101125001015562023-12-03T20:34:00.005-05:002023-12-04T10:51:50.850-05:00Milk Production and Wall Street are Similar.Milk production and Wall Street have similar financial profiles. They both have an opportunity for long-term financial gains and they both have significant financial volatility. Success in investing can show huge losses at times, but in the long-term a balanced portfolio will show significant financial gains. The near-term emotional reaction when the market is falling is to sellJohn Geusshttp://www.blogger.com/profile/07787141554094420499noreply@blogger.com0tag:blogger.com,1999:blog-7071318137679674976.post-89753642517352052962023-11-15T14:55:00.003-05:002023-11-26T11:29:47.237-05:00Where are the Most Productive Cows?In the last post, the long term economic impact of increasing components was reviewed. One of the reasons components increased was by increasing milk production. Over the last 23 years milk production per cow increased by 30%. There have been many questions on this, so this post will cover more details on the increase in milk production per cow. In some states there have been noJohn Geusshttp://www.blogger.com/profile/07787141554094420499noreply@blogger.com0tag:blogger.com,1999:blog-7071318137679674976.post-35614267442999950022023-11-07T20:38:00.008-05:002023-11-12T15:44:54.945-05:00The Financial Impact of More Components per CowCheese now utilizes over 50% of the U.S. milk produced. Cheese and other dairy items need only components, not milk volume. Fluid milk continues to decrease in consumption. Butterfat is at record high prices, and milk protein is at decent prices. Are these prices just temporary? What can a producer do to deliver milk that meets the current needs and provides adequate John Geusshttp://www.blogger.com/profile/07787141554094420499noreply@blogger.com6tag:blogger.com,1999:blog-7071318137679674976.post-36705633315225718512023-10-29T20:02:00.002-04:002023-11-06T15:39:54.974-05:00Where are Milk Prices Going?Producer milk prices are based on the wholesale price of four dairy commodities: butter, cheese, nonfat dry milk (NDM), and dry whey. The Agricultural Marketing Service does a weekly survey of these wholesale commodities. At the end of the monthly period, those survey results are combined to calculate the price for butterfat, milk protein, and "all other" for Class III milk and John Geusshttp://www.blogger.com/profile/07787141554094420499noreply@blogger.com0tag:blogger.com,1999:blog-7071318137679674976.post-58110052332581421572023-10-15T20:15:00.014-04:002023-11-07T12:38:08.093-05:00Sustainablilty and Making MoneyThe new buzzword for the dairy industry is sustainability. The USDA defines sustainability as "Sustainable agriculture is farming in such a ways to protect the environment, aid and export natural resources and to make the best use of nonrenewable resources." Dairy needs to provide food that is desirable, healthy, and affordable. U.S. dairies are doing just that. Today's John Geusshttp://www.blogger.com/profile/07787141554094420499noreply@blogger.com0tag:blogger.com,1999:blog-7071318137679674976.post-45127316350426311152023-10-08T15:55:00.001-04:002023-10-08T16:00:39.916-04:00Dairy Prices Show Some Improvement in 3rd QuarterProducer milk prices have fallen tremendously in 2023. The big question is "When will prices improve to make milk production profitable again?" The reasons for the fall in prices was covered in a recent post. This post will look to the future to see when and by how much producer milk prices may increase. The volatility during the span of data in this review is tremendous.&John Geusshttp://www.blogger.com/profile/07787141554094420499noreply@blogger.com0tag:blogger.com,1999:blog-7071318137679674976.post-32015700346920657092023-09-24T11:48:00.000-04:002023-09-24T11:48:18.084-04:00Exports of Cheese and Butter are Down. What Countries are Buying and What Ones are not?Cheese and butter exports are down significantly. This is contributing to the downturn in demand for producer milk. Cheese exports are down less as a percentage than butter exports. Data used in this post is based on July YTD data for 2023 compared to the same period in 2022.Table I below shows where the cheese exports are down and where they are up. Overall, through July John Geusshttp://www.blogger.com/profile/07787141554094420499noreply@blogger.com0tag:blogger.com,1999:blog-7071318137679674976.post-30462549468448960012023-09-17T16:39:00.004-04:002023-09-20T13:53:11.739-04:00The Real Reason for Slower Dairy Milk Demand and Lower Producer Prices!The prior two posts covered the lack of growth in milk demand and slowing sales of fluid milk, cheese, and butter. This post will show why retail sales of dairy products are slowing down demand for producer milk. As will be shown below, retail prices of the major dairy products has escalated tremendously in 2022. Fluid milk is a necessary buy in many households, but competition John Geusshttp://www.blogger.com/profile/07787141554094420499noreply@blogger.com0tag:blogger.com,1999:blog-7071318137679674976.post-57853468194664409152023-09-10T15:57:00.006-04:002023-09-10T19:59:29.434-04:00Why is Milk Production Shrinking?The prior post covered the shrinking demand for producer milk. Demand for producer milk is not growing. This post will examine the details causing the lower demand for milk.The possible reasons cited for no growth in the previous post were lower domestic consumption of dairy products like fluid milk, cheese, and butter and/or lower exports of key dairy products. This post will John Geusshttp://www.blogger.com/profile/07787141554094420499noreply@blogger.com0tag:blogger.com,1999:blog-7071318137679674976.post-60656431516602227162023-09-04T17:12:00.001-04:002023-09-05T11:59:01.937-04:00U.S. Milk Production is Not Growing!U.S. milk production is not growing. In the past, growth of 1 to 2 percent was required to supply demand, especially for the increasing consumption of cheese. Now almost no increase in milk production is needed. For reference, the largest milk producing states are listed below. The numbers are based on 2023 YTD data. Idaho retains third place over Texas with John Geusshttp://www.blogger.com/profile/07787141554094420499noreply@blogger.com2tag:blogger.com,1999:blog-7071318137679674976.post-39929489024504708722023-08-23T18:45:00.009-04:002023-08-25T09:17:32.678-04:00Milk Protein Prices Leap! New Data Released TodayFor the last five weeks, milk protein values have gone up consistently and significantly with the increase in cheese prices. As covered in the August 13 post to this blog, cheese prices have been falling in 2023. They are now recovering and recovering fast. Block cheese prices have increased by 38% and Barrel cheese prices have increased by 28% in the last five weeks. John Geusshttp://www.blogger.com/profile/07787141554094420499noreply@blogger.com0tag:blogger.com,1999:blog-7071318137679674976.post-23310254691673971692023-08-13T22:04:00.000-04:002023-08-13T22:04:18.772-04:00What is Moving the Price of Dairy Commodities that are used to Price Producer Milk? Producer milk prices are low. They are down because the commodities used to price producer milk are low. Why are they low? The commodity prices are based on actual transactions of purchases and disappearance from wholesale inventories of these products. The milk pricing process is managed by surveys conducted by the Agricultural Marketing Services (AMS). The John Geusshttp://www.blogger.com/profile/07787141554094420499noreply@blogger.com0tag:blogger.com,1999:blog-7071318137679674976.post-19731663911754492532023-07-23T19:54:00.008-04:002023-07-29T11:44:02.434-04:00How low can milk prices go? Here's the latest trends.There are four dairy commodities that control the pricing of producer milk, butter, cheese, nonfat dry milk (NDM), and dry whey. The charts below are based on the latest Agricultural Marking Services (AMS) pricing of these commodities. One commodity is stable and three are in deep falls. The data below is very current including weekly pricing published just five days ago.Butter John Geusshttp://www.blogger.com/profile/07787141554094420499noreply@blogger.com0tag:blogger.com,1999:blog-7071318137679674976.post-45057611579383738112023-07-16T21:04:00.002-04:002023-07-17T04:54:59.004-04:00Size Matters - Where are the Biggest Producers?The last post covered the stagnation of producer milk prices. At the end of that post was a list of things producers have used to lower costs and improve revenue such as improved components, higher milk yields, better feed formulation, and larger operations. There is very little published about the gains from increased size. This post will cover where and by how much producer John Geusshttp://www.blogger.com/profile/07787141554094420499noreply@blogger.com0tag:blogger.com,1999:blog-7071318137679674976.post-1400247512870668622023-07-04T15:49:00.001-04:002023-07-05T10:17:19.596-04:00Except for Butter, Producer Milk Prices Show no Growth in the Last DecadeThe prior post covered the amazing growth in the price of butter and butterfat. This post will show the pricing of the rest of the dairy products, all of which are showing slow to no growth in pricing. Butter and butterfat seem to be the only price positive dairy products. The June 11 post, covered domestic consumption of key dairy products. Domestic consumption John Geusshttp://www.blogger.com/profile/07787141554094420499noreply@blogger.com0tag:blogger.com,1999:blog-7071318137679674976.post-46172632710980413442023-06-25T17:22:00.008-04:002023-06-25T22:56:37.801-04:00Butterfat Continues to Amaze!One of the brightest spots in dairy production is the increase in butterfat. The products like cheese and butter consume most of the U.S. milk. With increased butterfat levels, less milk is needed. Milk production is currently growing at about .5% annually (Chart I). Butterfat production is growing by about 1.5% annually (Chart II). Together, the increases in John Geusshttp://www.blogger.com/profile/07787141554094420499noreply@blogger.com0tag:blogger.com,1999:blog-7071318137679674976.post-36859681039628170272023-06-18T19:03:00.003-04:002023-06-19T04:32:49.400-04:00Why is Domestic Dairy Consumption Down? Retail Pricing?The prior post confirmed that U.S. domestic consumption of dairy products is down. Why are they down? Is it the retail pricing? Is inflation still increasing prices on retail dairy products? Inflation is typically measured in year-to-year changes. But inflation is cumulative and builds continuously over time. This post will compare current retail pricing to the 2019 John Geusshttp://www.blogger.com/profile/07787141554094420499noreply@blogger.com0