Milk prices are trending higher in the United States and economis Bob Cropp of the University of Wiscomsin said they could go up a dollar to the mid-$17 range by November.
However, during August milk production was 1.1 per cent more than a year ago, but is the first time since March that the increase has been less than two per cent.
Severe drought, particularly in the West, has reduced forage supplies and driven feed prices higher, said Cropp.
“Corn and soybean meal prices are much higher than a year ago and with higher feed costs driving tighter margins, dairy producers are likely to further reduce cow numbers, and milk per cow may be dampened some,” he said.
Milk cow numbers have declined for three consecutive months. August cow numbers fell 19,000 from July and 29,000 from May. The number of cows was still 1.1 per cent more than a year ago.
Adverse weather impacted milk per cow, with no increase over a year ago. Ten of the 24 states reported milk per cow lower than a year ago, according to USDA.
South Dakota led all states in increased milk production, up 16.2 per cent from 22,000 more cows and higher milk per cow. That’s also where Chaboni built its Greek yogourt plant instead of Ontario.
However, for the five leading dairy states, the increase in milk production was lower than in recent months: