Today, May 18, 2009 USDA National Agricultural Statistical Service (NASS),released two reports http://www.nass.usda.gov/. The one most people in dairy are concerned with is milk production for the month of April.
The data showed milk production for April, 2009 was -0.1% when compared to April 2008. What is important and remember here is there is an annual population growth of just about 1%. For the previous five years, the average increase for the month of April, year on year, was virtually 2%.
So today's milk production data report really is further confirmation of production slowing down.
However, it is important to remember this is not a precise measurement. For instance, the report shows milk cow numbers down by 3,000 cows. In order for the milk production to remain the same dairy farmers would have to have gone a little heavy on the grain scoop. With farmers struggling to pay grain bills, the idea of feeding more grain is more than a little hard to believe.
The second report issued today is "Crop Progress." Here the problem with report is simple average. For the 18 lead corn states, the simple average reports that 62% of the corn has been planted. However Illinois is the second corn state and only 20% of the Illinois crop has been planted and just 7% has emerged.
One hardly needs a crystal ball to predict grain prices will be rising for dairy farmers.