At $20.06 per hundredweight, the 2013 mailbox price series posted the second-highest mark since USDA first gathered prices in 1995. Mailbox prices matter to every dairy producer because those values reflect the actual price they receive for their milk. Hence, the name mailbox price implies the actual milk checks dairy producers receive in their mailbox.
While 2013 was on pace to be a strong year, the final three months pushed the average higher as October's $20.83, November's $21.65 and December's $22.04 were the strongest prices of the year. Even so, that left 2013 14 cents behind the watermark for 2011 of $20.20 per hundredweight or cwt.
Like 2011, stiff feed prices created a fierce headwind that prevented many dairy producers from netting a positive return even after historically high mailbox prices. When compared to 2011, last year's higher feed costs actually soaked up more of the milk check from January to August as the 2012 drought kept feed in short supply.
By September, pent-up product demand pushed milk prices higher, and a plentiful harvest caused feed prices to subside. As a result, producers began to pocket positive cash flow in the last quarter of the year.
When comparing regions, Florida once again set the pace at $22.95 per cwt., with 86 percent of its milk going towards the highly valued fluid use category. The Southeast was close behind at $21.58 with 68 percent of its milk going to beverage milk.
On the other end of the spectrum, New Mexico had the lowest mailbox price at $17.93 per cwt. and California was slightly ahead at $18.26.
For a full analysis of the 2013 mailbox prices, turn to page 249 of your April 25 issue. In the meantime, you can glean the yearly averages from each region by reviewing the map.
