The USDA’s monthly World Ag Supply and Demand Estimates (WASDE) report reflects the uncertainty of agricultural markets due to Russia’s military action in Ukraine. It also forecasts a year-over-year decline in U.S. milk production.

Update Highlights

• February Class III-IV milk prices higher
• PMVAP payments wrapping up
• U.S. dairy export outlook improves but imports up too
• Dairy cull cow slaughter slowed in January
• November 2021 mailbox, all-milk price spread tightened

Milk pricing is complex, but the producer price differential (PPD) is also frustrating. First, most producers don’t understand how it is calculated. Second, a negative PPD, which happens a lot, looks like a milk check deduction (it isn’t actually).

The jump to an eight-year high in milk prices outpaced increasing feed costs, meaning there will be no Dairy Margin Coverage (DMC) program indemnity payments at any level for January milk marketings.

There seems to be an uptick in complaining about Federal Milk Marketing Orders (FMMOs), with a fair amount of calling for “reform” of the FMMO system. I have read some of this commentary, as maybe you have, and would like to respond to it.

Agriculture is increasingly facing more environmental pressure from regulators, activist groups and private citizens. As an environmental consulting firm, Dragun Corporation has worked with agriculture for more than 30 years, helping address complex issues including nitrates in groundwater, PFAS contamination, groundwater supply and more.

Progressive Dairy provides updates on dairy-related organizations and companies, compiled from staff news sources and industry press releases. Email industry and organization news to Progressive Dairy Editor Jenna Hurty.

Declining cow numbers and receding milk production per cow pulled January 2022 U.S. milk production below year-ago levels for a third consecutive month.

With a USDA extension giving dairy producers several more weeks to enroll in the Dairy Margin Coverage (DMC) and Supplemental DMC programs, many producers are being urged to reevaluate their initial decisions not to sign up for the federally subsidized safety net program in 2022.

The Federal Milk Marketing Order (FMMO) advanced Class I base price hit another eight-year high in March, but the change in the Class I mover formula implemented in 2019 reduced what might have been an even higher price paid to producers.