Milk production higher than expected in July

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Rather than a substantial decline in milk production, as some analysts had predicted following a heat wave in the early part of the month, milk production in July dipped only slightly compared to June.

With milk production down only slightly, what might have been a bullish report from USDA has now taken on bearish overtones.

Milk production was 15.674 billion pounds in the top 23 states in July ― down 0.8 percent from June, but up 1.2 percent from July 2012. Across the entire U.S., milk production was up 1.1 percent from a year ago, according to the "Milk Production” report released by the USDA Monday afternoon. 

“Milk production stronger than expected during July,” pointed out dairy analyst Dave Kurzawski with FCStone in Chicago. “While we think this report is bearish versus expectations, 1.2 percent milk production growth is not overwhelming for current dairy market futures prices right now.”

Kansas posted the largest gain at 10.8 percent compared to the same month a year earlier. Wisconsin, the nation’s No. 2 milk-producing state, was up 2.9 percent, while California (the No. 1 state) was down 3.5 percent.

This is an abbreviated milk production report from the USDA. Initially, the USDA suspended the report and several others in the wake of the automatic federal budget cuts known as sequestration. However, the department reversed its decision and announced that it would provide partial milk production estimates through September. 



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