Dairy consumption down,
*
milk production
WASHINGTON, D.C. -
Supplies of milk and dairy
products are increasing in
1900, while commercial use
of dairy products has
weakened. As a result,
commercial stocks are
ample, CCC purchases are
heavy, and farm milk prices
are still below the new
support level.
According to a Dairy
Situation report to be
released by the U.S.
Department of Agriculture,
milk production during the
rest of 1900 likely will con
tinue above year-earlier
levels, although the rate of
increase may slow as the
year progresses.
The report, prepared by
(TSDA’s Economics,
Statistics, and Cooperatives
Service, notes that farm
milk prices may rise to the
support level in coming
months, but any increase
above support will be limited
unless commercial use
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strengthens more than
currently expected.
Commercial use of milk
and dairy products during
January-March was down by
0.2 percent from last year,
American cheese use
declined by 3 percent, more
than offsetting a 4.5 percent
gam in sales of cheese-other
than-American.
Commercial dissap
pearance of butter was
nearly even with a year ago.
With continued large meat
supplies, the economy in a
recession, and further
declines m real disposable
per capita income likely,
commercial use of milk and
dairy products during the
rest of 1900 may remain
below the high 1979 levels.
Milk production during the
first four months of 1960, on a
daily average basis, was
three percent above a year
earlier. This resulted from
relatively large gams m
output per cow, reflecting
increases
quite favorable milk-feed
price relationships. Also,
because of reduced culling
and a large number of
replacements, milk cow
numbers have stabilized
thus far this year.
Cow numbers m March
and April were above year
earlier levels. All five of the
major dairy states posted
production gains in April, led
by a 5.4 percent increase in
California.
Production is expected to
rise substantially three
percent over last year
during April-June but
output gains in the second
half may slow from a year
ago. The levels of production
will depend on cow numbers,
weather and pasture con
ditions, farm milk prices,
feed prices, and other
production costs.
These uncertainties
suggest that for all of 1960,
milk production could show
an increase of two to three
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percent above the 123.6
billion pounds produced in
• 1979.
The milk-feed price ratio
has continued favorable in
1980. In 1979, the annual
average value of con
centrates fed per 100 pounds
of milk produced was $2.95,
up 13.5 percent from 1978.
Even though feed costs
were up, sharply higher milk
prices received by dairy
farmers brought returns
over concentrate costs to
$9.05 per 100 pounds of milk,
13.1 percent above the
previous year.
Cash receipts to dairymen
during January-April were
up about 12 percent from
a year ago. Cash receipts
could exceed |16.5 billion
this year, and dairy fanners’
net income should ap
proximate the favorable
situation of the past few
years.
Wholesale prices of butter,
nonfat dry milk, and cheese
Lancaster Farming, Saturday, May 31,1980—8 S
were below support pur
chase prices in mid-May,
reflecting heavy milk
supplies, ample commercial
stocks, and weak sales.
The price stability in
wholesale markets this past
winter was reflected in the
slowing of retail dairy
product price increases in
recent months. For all of
1980, retail prices will
probably average 9 to 11
percent higher than last
year.
First-quarter production
of butter, nonfat dry milk,
and cheese was up sub
stantially as milk supplies
remained heavy.
Manufactured output will
continue to run above year
earlier levels through late
spring and early summer, as
there will be more milk
available.
Last year, a record 67.4
million pounds were used to
manufacture dairy products,
two percent more than in
1978.
Commercial stocks of
dairy products on April 1
reflected the large
manufactured output and
sluggish sales during early
1900. Milkfat stocks were 15
percent greater than a year
earlier, while solids-not-fat
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holdings were a fourth
larger.
January-April purchases
of dairy products by CCC
totaled 2.9 billion pounds
milk equivalent, nearly a
third larger than removals
for all of 1979. April pur
chases of x.? billion pounds
were the largest in any one
month since June 1971.
Quota-type cheese imports
during January-March were
down substantially from
a year ago. This was due
largely to heavy imports
entering during December in
anticipation of new import
quotas, and in part to delays
in licensing importers. On a
milk equivalent basis, im
ports were 2 percent less
than a year ago as increased
imports of most other dairy
products nearly offset the
lower cheese imports.
Early 1960 milk production
was well above year-earlier
levels in the European
Community, while output
decreased substantially in
the Soviet Union, the world’s
largest milk producing
nation. Lower output in
Eastern Europe and strong
import demand by
developing nations resulted
in brisk international dairy
product trade in early 1900.
etitive