ch 14

Overview of U.S. Dairy Economic Impact

  • The U.S. dairy industry has a significant economic impact, quantified at $620 billion overall, contributing over 3 million jobs.

U.S. Dairy Industry Overview

  • In 2006, the U.S. dairy cow population was 9.1 million, yielding an average production of 19,951 pounds per cow.
  • By 2018, the dairy cow population increased to 9.4 million, with an average production of 23,149 pounds per cow.
  • The value of U.S. milk production in 2017 was $38.1 billion, up from $34.5 billion in 2016.

Milk Production Statistics

  • The total annual milk production for the U.S. in 2018 was 218 billion pounds, marking a 1.0% increase from 2017.
    • Production per cow in 2018 averaged 23,149 pounds, exceeding the production of 2017 by 235 pounds.
    • Comparing to 2009, total milk production has risen 15.0%.
    • The average annual rate of milk production per cow has increased 12.6% since 2009.
    • The average number of milk cows reported was 9.40 million in 2018, reflecting a slight decrease of 0.1% from 2017.

Dairy Farms and Employment

  • As of March 2022, there were just under 30,000 dairy farms in the U.S.
    • These farms collectively milked 9.4 million cows.
    • Each cow has an average production rate of 23,149 lbs/year.
    • The farm gate price for milk contributes to $38.1 billion/year, with the understanding that the farm gate price generally represents 28% of the end price.
    • Direct employment from dairy farms is 955,915, with indirect jobs totaling 2,085,932, creating a total of over 3 million jobs in the dairy industry.

Contributions to the Economy

  • The dairy industry generates approximately $38 billion in farm gate revenue.
  • It contributes 1% to the national GDP.
  • The total economic impact adds up to $620 billion.
  • The industry supports more than 3 million jobs, with a combined tax contribution of $64.5 billion (excluding consumer sales taxes).

Sectoral Economic Impacts

  1. Milk:

    • Economic Impact: $51.4 billion
    • Jobs Supported: 64,400

  2. Ice Cream:

    • Economic Impact: $11 billion
    • Jobs Supported: 26,100

  3. Cheese:

    • Economic Impact: $50.9 billion
    • Jobs Supported: 52,200

  4. Yogurt & Cultured Products:

    • Economic Impact: $5.5 billion
    • Jobs Supported: 6,900

  5. Dairy Ingredients:

    • Economic Impact: $14.1 billion
    • Jobs Supported: 9,300

Detailed Economic Outputs and Job Data

  • Direct Economic Impact:
    • Total Output: $198,855,063,800
    • Direct Jobs: 955,913
    • Direct Wages: $37,568,472,300
    • Total Taxes: $64,540,860,900

California Dairy Industry Statistics

  • In California:
    • Direct Output: $28,080,685,500
    • Direct Jobs: 102,225
    • Direct Wages: $5,096,947,800
    • Total Taxes: $11,671,039,100

Additional Economic Contributions Breakdown

  • Direct impacts of dairy:
    • Total direct impacts, defining output, jobs, and wages across different dairy products.
    • Cheese:
      • Jobs: 52,249
      • Wages: $3,618,299,600
      • Economic Impact: $50,927,692,300
    • Ice Cream:
      • Jobs: 26,107
      • Wages: $1,551,970,700
      • Economic Impact: $11,046,556,700
    • Milk Production:
      • Jobs: 64,449
      • Wages: $4,984,967,300
      • Economic Impact: $51,440,484,300

Summary of Dairy Economic Impact

  • The overall dairy market is valued at $620 billion, constituting 1% of the U.S. economy.
  • The industry supports 3 million jobs and milks 9.4 million cows producing 218 billion lbs of milk annually.
  • The farm gate value of milk is estimated between $38.1 billion to $39 billion.

Implications of Dairy Industry

  • The dairy industry has far-reaching effects on employment, economic contributions, and supplier impacts, emphasizing its importance to the U.S. economy.