Milk-feed ratio continues to improve
By Dairy Herd staff
| Friday, October 30, 2009
The milk-feed profitability ratio rose to 2.04 in October, compared to a revised ratio of 1.98 in September, according to the USDA’s “Agricultural Prices” report released on Friday. A year ago, the ratio stood at 2.02.
The current ratio of 2.04 means that a dairy producer can buy 2.04 pounds of feed for every pound of milk sold. Whenever the ratio meets or exceeds 3.0, it is considered profitable to buy feed and produce milk.
Improvements in the October milk-feed ratio came about as the result of higher milk prices.
The corn price used to calculate the ratio in October was $3.54 per bushel, up 29 cents from $3.25 in September. The price of baled alfalfa hay fell $1 per ton to $109. Soybeans fell a penny per bushel to $9.74.
The all-milk price used to calculate the ratio was $13.80 per hundredweight — up 90 cents from September.
Source: USDA
