Mailbox milk prices posted a new record nationally last year averaging $24.04 per hundredweight (cwt.), based on data tabulated by USDA's Agricultural Marketing Service (AMS) and the Federal Milk Market Order (FMMO) administrators. That price was $3.84 higher than 2011's previous high of $20.20.
Of course, averages can be deceiving . . . both of the above totals do not include California, which has a state order currently run by the California Department of Food and Agriculture. Had the nation's leading milk production state's average of $21.83 been included in the 2014 total, the $24.04 value would have been in the high $23 range. Overall, 19 areas went into the national average, not including California (see map above).
As the title suggests, not all milk is priced equally causing mailbox prices to range from $27.07 to $21.50. In general, the southeast and northeast U.S. have the highest prices while the Southwest and Northwest have among the nation's lowest prices. Class I differentials for fluid or beverage milk play a major role as more milk on the eastern seaboard goes toward bottling.
Top four price areas: As a result, Florida once again led the nation in milk prices at $27.07 per cwt. The Sunshine State was closely followed by the Southeast at $25.87 (Arkansas, Louisiana, Mississippi, Alabama and Georgia); Appalachian, $25.44 (North and South Carolina, Kentucky, Tennessee and Virginia); and New England $25.42 (Maine, Vermont, New Hampshire, Massachusetts, Connecticut and Rhode Island). These regions were the highest among all 20 regions in the past two years.
Bottom four price areas: New Mexico dairy producers received the lowest price in the nation at $21.50. That was followed closely by California, $21.83; western Texas, $22.71 and the Corn Belt, $22.95 (Nebraska, Kansas and northern Missouri). These areas were the lowest in both 2013 and 2014.
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.
For a full analysis of the 2014 mailbox prices, turn to page 248 of your April 25 issue. In the meantime, you can glean the yearly averages from each region by reviewing the map.
(c) Hoard's Dairyman Intel 2015
March 30, 2015
