Lecture 3: US Dairy Industry

Dairy Classes and Products

-What are the dairy classes and list examples of products

Class 1: Fluid Milk

examples: whole milk, reduced fat, low fat, non fat, eggnon

Class 2: Cream + Soft Manufacted Products( Sponables)

examples: cottage cheese, ice cream mix, yogurt, sour cream

Class 3: Hard manufactured products

examples: hard cheese, cream cheese, spreadable cheese

Class 4: butter, powdered milk

U.S Dairy Industry Overview

Trends in Milk Production?

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What are factors responsible for these trends?

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Trends in Milk Production?

-made 19 billion lbs. of milk past 10 years

-increased the number of cows per herd

-increase cow production efficiency per cow by 7.1%

-# of herds are decreasing but # of cows per herd is increasing

-milk fat has increase by 16%

What are factors responsible for these trends?

-number of farms: huge capital expense to start a new farm + small farms are struggling

-Increase in Herd Size: Pay less for production due to larger operations

-Increase in # of cows: set prices for feed, take more risk, insurance for feed cost + price

-Milk production: advancements in research + feed have allowed to increase milk production

What are the top Dairy States in the US?

Where are we seeing industry growth?

-top states: California, Wisconsin, Idaho, Texas, New York

-in western and southern state

-Where is 65% of dairy farms located in the U.S: Wisconsin, Pennsylvania, New York, Minnesota, Ohio

How much of U.S Dairy Products are exported?

-What products are being, how much, and where

-18% of Dairy Products

-Mainly export Lactose, Nonfat dry milk, and whey

-huge exporters are to China, Mexico, and Canada

US Milk per CWT

-below the red line, farmers are losing profits

Production of Milk in U.S

-what is federal order milk?

-look at graph

-top producing counties are in California + Idaho

-A Federal Milk Marketing Order (FMMO) is a USDA‑administered program that sets minimum prices for milk and establishes rules for how dairy processors (handlers) must pay dairy farmers (producers) for milk sold in defined geographic marketing areas.

Milk Production Trends in Indiana

-most farms are less than 50 head per herd

-mainly have fluid milk processors

-most milk goes to fluid bottles

-2nd largest ice cream

-we partially specialize in cheese( little production)

-shortest distance to median center of U.S population

-competitive prices

-good agricultural environment to support and grow dairy industry