Milk Production Costs Headed to All-Time Highs

Total operating costs for U.S. dairy producers have risen every month since January 2011, reaching $17.06 per cwt. for October, USDA’s Economic Research Service (ERS) reported Nov. 28 in its monthly report on dairy costs of production.  Not surprisingly, feed costs accounted for the largest operational expense, climbing to $13.41 per cwt., the year’s highest level. Purchased feed, as opposed to homegrown or grazed, accounted for $8.04 per cwt., ERS noted.  The latest production costs put 2011 on track to rival – or even surpass -- 2008’s high-water mark. Total feed costs in 2008 averaged $12.54 per cwt., ERS figures show. That compares to USDA’s feed-cost average for the first 10 months of 2011 of $11.83 per cwt. In 2010, total feed costs for U.S. dairies averaged $11.17 per cwt., according to ERS. <more>  Dec. 1, 2011 Dairy Today