California: Milk cost of production rose 15.3% in 2011

California dairy producers’ average costs to produce 100 lbs. of milk rose 15.3% in 2011 compared to a year earlier, according to the California Department of Food & Agriculture Dairy Marketing Branch annual Cost of Production report. Statewide, the total cost of milk production on a hundredweight basis increased from $13.70/cwt. in 2010 to $15.79/cwt. in 2011. On a per-cow basis, monthly costs increased 17.8%, averaging $293.10/cow/month in 2011, compared to $248.00/cow/month in 2010. The increased cost was largely due to higher feed prices for hay, grain commodities and by-products, which increased in every quarter compared to the corresponding quarter a year earlier. The statewide average feed cost for 2011 averaged $10.10/cwt. of milk produced, up from $8.74/cwt. (up $2.26/cwt., or 28.8%) compared to 2010. Feed cost in 2011 represented 63.9% of the total cost to produce a hundredweight of milk, compared to 57.3% in 2010. (more) May 17, 2012 DairyProfit Update