Market Update

Feed driving down milk production costs

The USDA has released its latest data on milk production costs. The average costs of producing a cwt of milk in the US  in January 2015, was 6% down on December 2014, and 8% down on January 2014. The biggest drop was in the cost of purchased feed which was 16% down on December, and 18% down on January 2014.

Average production costs for 2014 were 6% down on the average costs for 2013, however they were 17% up on 2010. The main factor being falling feed prices, which have eased back following a peak in 2013. This fall in feed costs and increased optimism has led to increased milk production during 2014, and into 2015, and is now putting pressure on milk prices.