Milk production declined for the fourth consecutive month – down 1% YOY in February according to the USDA. The contraction was relatively lower compared to the 1.7% YOY decline in January.

The overall decline in February reflected a 0.1% YOY rise in average yields per cow and a 1% YOY drop in the national dairy herd. At 9,370m, cow numbers were surprisingly 3,000 head above the prior month and 96,000 head below the same month in 2021. Cow numbers increased for the first time since May last year, but further reductions in the herd can be expected later in Q2-22, with several large operations up for sale in the West which will include the impact of the worsening water situation in California.

Among major producing states, February milk production in Wisconsin rose by 0.7% YOY. California output was down 0.2% YOY, while New Mexico again posted the largest decline among all states – down 13.1% YOY – the eighth consecutive monthly contraction and the sixth straight double-digit fall.

Milk supplies also continued to decline in Washington (-4.7% YOY), Pennsylvania (-0.9% YOY), Ohio (-3.4% YOY) and Michigan (-2.9% YOY). On a positive note, milk production in South Dakota and Texas continued to improve at impressive rates, up 18.3% YOY and 4.3% YOY respectively.