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Pay and Feed Price, November/December 2022

By Ed Maltby, NODPA Executive Director

The Agricultural Marketing Service (AMS) reported in July 2022 that estimated fluid product sales of organic milk increased by 0.3% over July 2021, and an increase of 2.1% in August 2022 over August 2021, with a minus 1.5% for the year-to-date 2022 over 2021. Organic whole milk sales, at 108 million pounds in July, and 116 million pounds in August, showed the greatest growth with a 2.2% growth year-to-date. Reduced fat milk sales were 119 million pounds in July, and 124 million pounds in August 2022, falling 4.7 percent from the previous year year-to-date.

Product Name

Sales of Organic Fluid Milk in million pounds

Percent Change from

Jul-22

2022 Year to date

Jul-21

Year to date

Organic Whole Milk

108

779

5.6%

1.6

Flavored Whole milk

1

12

-22.3%

10.1

Organic Reduced Fat Milk (2%)

75

558

-3.6%

-3.7

Organic Low-Fat Milk (1%)

22

173

-6.9%

-8.4

Organic Fat Free Milk Skim

13

100

-8.9%

-7.3

Organic Flavored Fat-Reduced Milk

8

48

11.8%

-4.8

Other Fluid Organic Milk Products

0

1

234.2%

261.8

Total Fat Reduced Milk

119

879

-3.8%

-5

Total Organic Milk Products

228

1,670

0.3

-2

Product Name

Sales of Organic Fluid Milk in million pounds

Percent Change from

Aug-22

2022 Year to date

Aug-21

Year to date

Organic Whole Milk

116

894

6.6

2.2%

Flavored Whole milk

1

13

37.5

11.60%

Organic Reduced Fat Milk (2%)

79

636

-1.1

-3.3%

Organic Low-Fat Milk (1%)

24

197

-8.4

-8.4%

Organic Fat Free Milk Skim

13

113

-6.7

-7.2%

Organic Flavored Fat-Reduced Milk

8

56

25.4

-1.5%

Other Fluid Organic Milk Products

0

1

85.7

221.6%

Total Fat Reduced Milk

124

1004

-1.9

-4.7%

Total Organic Milk Products

241

1911

2.1

-1.5

Federal Milk Market Order 1, in New England, reports utilization of types of organic milk by pool plants. During August 2022, organic whole milk utilization totaled 16.2 million pounds, up from 11.8 million pounds the previous year. The utilization of organic reduced fat milk, 16.0 million pounds, increased from 15.4 million pounds a year ago. During September 2022, organic whole milk utilization totaled 17.6 million pounds, up from 14.1 million pounds the previous year. The utilization of organic reduced fat milk, 17.4 million pounds, increased from 16.2 million pounds a year ago.

FMMO 1 UTILIZATION OF ORGANIC FLUID MILK PRODUCTS AND CREAM BY POOL PLANTS (Million pounds)

Fluid retail Organic Milk 2022

Fluid retail Organic Milk 2021

Fluid retail Organic Milk 2020

Increase/Decrease of 2022 over 2021

Increase/Decrease of 2021 over 2020

JANUARY

29.14

31.32

23.93

-7%

31%

FEBRUARY

33.65

31.56

26.69

7%

18%

MARCH

31.56

31.87

27.90

-1%

14%

APRIL

33.23

28.97

29.35

15%

-1%

MAY

30.49

29.72

28.25

3%

5%

JUNE

31.53

28.41

26.90

11%

6%

JULY

29.44

25.50

26.70

15%

-4%

AUGUST

32.12

27.18

24.70

18%

10%

SEPTEMBER

35.00

30.26

29.70

16%

2%

OCTOBER

29.47

25.78

14%

NOVEMBER

31.07

24.47

27%

DECEMBER

31.36

28.13

11%

ANNUAL

286.16

356.68

322.50

11%

Mercaris supplies data on the average pay price for organic milk over the spot price. There was not a significant amount of trading on the Spot Market in September 2022. Anecdotally, producers, processors, and buyers report that organic milk is short in the northeast.

U.S. Organic Dairy Prices (U.S. Dollars per CWT)

Date

Spot Fluid Milk Price

Fluid Milk Pay Price

Mar-22

$ 33.21

$ 28.54

Apr-22

$ 32.72

$ 29.59

May-22

$ 33.88

$ 28.77

Jun-22

$ 35.88

$ 29.05

Jul-22

$ 35.88

$ 28.37

Aug-22

$ 37.05

$ 29.66

Sep-22

$ -

$ 29.66

Data from Mercarus 10/18/2022

AMS reports organic milk retail prices for selected U.S. cities. The data is collected by the Federal Milk Market Order administrators based on a survey conducted one day between the 1st and 10th of each month (excluding Fridays and weekends) in selected cities or metropolitan areas. One outlet of the largest and second largest food store chains are surveyed. The price represents the most common brand in ½ gallon nonreturnable containers. The September 2022 in-store retail surveys showed the average retail price increased to $4.72 and to $4.81 in October 2022, up 14 cents from the August 2022. with Pittsburgh, PA paying up to $6.49 per half gallon while Seattle WA pays only $3.94 per half gallon. The producer receives $1.33 for a half gallon of milk.

Year

Average cost of production $ per cwt

Average Pay Price in the northeast

2014

$ 35.09

35.39

2015

$ 38.29

38.39

2016

$ 38.58

35.68

2017

$ 36.90

33.27

2018

$ 33.80

31.52

2019

$ 37.72

31.52

2020

$ 37.02

31.52

2021

$ 36.73

31.51

2022

$ 40.20 est.

31.86

Stonyfield/Lactalis have increased their pay price by $1.50/cwt starting in December 2022. This brings their pay price just above Upstate and above CROPP. The table below puts the long-term picture in perspective.

Organic soybean meal is reported “down” to $1,450/ton at the mill. Soybeans are at $31.55 and feed corn is at $11.18 per bushel.

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