Cheese Output Hits Record High of 13.3 Billion Pounds in 2020
Published: Friday, May 7, 2021
The following is from Lee Mielke, author of a dairy market column known as "Mielke Market Weekly."
Back on the home front, U.S. milk production totaled 223.2 billion pounds in 2020, up a hefty 2.2 percent from 2019, or 1.9 percent, factoring the extra Leap Day. This week's annual Dairy Products Summary shows where the milk went.
Cheese output totaled a record 13.3 billion pounds in 2020, .9 percent above 2019. Wisconsin remained the biggest cheese producer, accounting for 25.6 percent of total cheese production.
Italian varieties totaled 5.63 billion pounds, down .8 percent from 2019, and accounted for 42.4 percent of the total cheese output in 2020.
Mozzarella cheese accounted for 79.1 percent of the Italian group, followed by Parmesan at 7.4 percent, and Provolone at 6.5 percent. Again, Wisconsin was the leading producer of Italian-type cheeses, at 29.3 percent share.
American-type cheese output amounted to 5.34 billion pounds, 2 percent above 2019 output, and accounted for 40.3 percent of 2020 cheese. Wisconsin was the leading state again, with 19.9 percent. Cheddar totaled 3.8 billion pounds, up 2.4 percent.
U.S. butter production totaled 2.15 billion pounds, up 7.6 percent from 2019 and topped 2 billion pounds for the first time. California was the No. 1 butter producer, with 31.1 percent of total output.
Nonfat dry milk for human consumption totaled 1.99 billion pounds, up 7.6 percent, while skim milk powder amounted to 695 million pounds, up 21.4 percent from 2019. And dry whey totaled 951 million pounds, down 2.7 percent from 2019.
In dairy politics, the National Milk Producers Federation requested an emergency USDA hearing on a Federal Milk Marketing Order proposal to "restore fairness for farmers in the Class I fluid milk price mover."
An NMPF press release stated, "The plan would ensure that farmers recover lost revenue and establish more equitable distribution of risk among farmers and processors. The current mover was adopted in the 2018 farm bill and intended to be revenue neutral while facilitating increased price risk management by fluid milk bottlers. But the new Class I mover contributed to disorderly marketing conditions last year during the height of the pandemic and cost dairy farmers over $725 million in lost income. NMPF's proposal would help recoup the lost revenue and ensure that neither farmers nor processors are disproportionately harmed by future significant price disruptions," NMPF said.
"While the current Class I mover was designed to improve the ability of fluid milk handlers to hedge milk prices using the futures market, it was also expected to be revenue-neutral compared to the formula it replaced," NMPF charged. "That has not been the case. The significant gaps between Class III and IV prices that developed during the pandemic exposed dairy farmers to losses that were not experienced by processors, showing the need for a formula that better accounts for disorderly market conditions."
NMPF's proposal would modify the current Class I mover, which adds 74 cents per hundredweight to the monthly average of Classes III and IV, by adjusting this amount every two years based on conditions over the prior 24 months, with the current mover remaining the floor.
Meanwhile, four Midwestern dairy groups have joined in support of a proposal, of their own and include the Dairy Business Assn., Edge Dairy Farmer Cooperative, Minnesota Milk and Nebraska State Dairy Assn.
A joint press release states that their plan is "aimed at creating long-term stability in fluid milk pricing and reducing the likelihood of negative producer price differentials that cut into farmers' revenue last year during the pandemic," and came about after they studied options early this year.
Referred to as "Class III Plus," the plan "aims to build upon the current pricing system, recent proposals by dairy cooperatives, and dairy farmer petitions to define a better Class I pricing system," the group stated.
"Our proposal looks to the future. It would make lasting changes to the milk pricing system that will limit negative PPDs in the future and the possible negative effects from future crises," DBA President Amy Penterman, a Wisconsin dairy farmer, said.
"The Class III Plus proposal would, among other things, tie the Class I (fluid) skim milk price to the Class III (cheese) skim milk price plus an adjuster and do away with advanced pricing, a cause of the negative PPDs last year. The proposal is also revenue-neutral, therefore more equitable among farmers, processors and customers."
"The recent call by cooperatives within the National Milk Producers Federation for an emergency FMMO hearing includes a proposal that improves a few components of the current pricing structure, but largely focuses on the short term and revenue that farmers did not earn in 2020," the four groups said.
In the week ending April 17, 60,400 dairy cows were sent to slaughter, down 100 from the previous week and 7,400, or 10.9 percent, less than that week a year ago.
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