A decline in cow numbers and a modest gain in milk output per cow helped limit July 2018 U.S. milk production growth to just 0.4 percent compared to a year earlier. Reviewing the USDA estimates for July 2018 compared to July 2017: U.S. milk production: 18.35 billion pounds, up 0.4 percent U.S. cow numbers: 9.396 million, down 8,000 head U.S. average milk per cow per month: 1,953 pounds, up 10 pounds 23-state milk production: 17.3 billion pounds, up 0.4 percent 23-state cow numbers: 8.735 million, up 1,000 head 23-state average milk per cow per month: 1,980 pounds, up 8 pounds Source: USDA Milk Production report, Aug. 20, 2018

The USDA’s Risk Management Agency announced the long-awaited launch of the Dairy-Revenue Protection (Dairy-RP) milk revenue insurance program. Developed by the American Farm Bureau Federation (AFBF), American Farm Bureau Insurance Services and other collaborators, the program is now in the hands of authorized crop insurance agents, who are attending workshops and preparing spreadsheets and actuarial tables for the start of the application period, Oct. 9. Here’s what we think we know so far. Watch Progressive Dairyman for additional information.

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Meeting Aug. 1, the Federal Reserve board voted to hold off on raising interest rates again. Recent reports from Federal Reserve district banks in major agricultural regions indicate interest rates on fixed- and variable-rate loans increased (Table 1), reaching levels last seen in 2010-12.

Dairy farmers attending a summit to explore dairy policy and marketing options overwhelmingly supported some method of milk supply management, but worried congressional action might take too long for many of them to survive.

The USDA plans to purchase $50 million worth of fluid milk for distribution to domestic food assistance programs, the agency announced on Aug. 14. These purchases will be separate from any USDA dairy product purchases under another program designed to provide financial assistance to dairy farmers negatively impacted by the ongoing tariff war with major U.S. dairy export customers.

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The USDA’s August World Ag Supply and Demand Estimates (WASDE) report left the outlook for 2018 milk production unchanged, but raised the 2019 forecast based on slightly higher cow numbers and increased milk per cow.

The “dog days” of summer generally create a weather-driven hay market, with all eyes on harvest quality and yield. This year, however, the markets have additional bones to chew on – trade wars and a lingering weak dairy economy.

The long-awaited launch of Dairy Revenue Protection insurance coverage will be in early October, providing dairy farmers with another tool to manage income risk in 2019.