In your January 10, 2022, issue . . .

MILK OUTPUT DECLINED in 15 of the 24 major dairy states this November, sending the overall U.S. production down 0.4%. California climbed 1% and Wisconsin rose 2.2%. New Mexico dropped 13.2%.

TIGHT MILK AND PRODUCT SUPPLIES have propelled Class III and Class IV futures contracts upward in the past two months. Class III contracts for the months of January to November 2022 averaged $19.90 at the magazine’s close. That was up $1.35 per cwt. since November 1 trading.

CLASS IV SHOWED THE LARGEST GAINS as the January to November bundle netted $20.70. That was a remarkable $2 gain in 55 days.

“DAIRY MARKETS ARE TEETERING at levels not seen since 2014,” shared Rabobank economists. Milk production in the Big 7 exporting regions is expected to decline by 0.3% versus last year’s high comparable. This would be the first quarterly year-over-year decline since 2019.

“FARM GATE MILK PRICES have followed commodity prices higher worldwide, with more potential upside in some regions,” added Rabobank. “Still, rising costs of inputs, lack of labor, unfavorable weather, and questionable feed quality will limit the production response by producers.”

“THERE IS NO IMPROVEMENT in the EU or U.S. milk production yet, and the weather in New Zealand has stayed suboptimal,” wrote Nate Donnay with StoneX. “We’re in a supply-driven market, and there is no sign that supply is getting better . . . yet,” he said of dairy markets.

WHEN IT COMES TO FEDERAL ORDER REFORM, USDA Secretary Tom Vilsack shared that the conversation is largely for dairy to work through, not USDA, while visiting a Wisconsin dairy last month, “Frankly, I think it’s up to the dairy industry itself to work through this process.”

DAIRY LOOKS DIFFERENT and has different priorities across the country, and Vilsack recognized that consensus and compromise is not a simple process. “Rather than USDA trying to dictate what we think the solution is going to be, and maybe make a mistake so that Wisconsin thinks it’s great but Vermont thinks it’s horrible, you all need to work at this and come up with a plan,” advised the two-time USDA Secretary.

A RECORD LOW 0.008% OF PICKUP TANKER MILK LOADS tested positive for antibiotics . . . 290 out of 3.5 million samples. In those rare instances, milk was discarded and did not enter the food chain.

DAIRY FARMERS HAVE UNTIL FEBRUARY 18 to sign up for the Dairy Margin Coverage (DMC) program in 2022. Enroll at county FSA offices.

FROM JUNE TO OCTOBER, U.S. milk cow numbers declined by 1.73 percentage points, the largest such drop over the span of four months in at least 22-1/2 years, Peter Vitaliano shared in Milk Check Outlook on page 3.