Last year, the mailbox price for all Federal Milk Marketing Order areas averaged $17.31/cwt, up $1.36 from 2016, but $6.73 below the record high price set in 2014. The highest prices were recorded in January 2017 at $18.72 and fell to $16.15 in June.
The mailbox price is defined as the net price received by dairy farmers for milk, including all payments received for milk sold and deducting costs associated with marketing the milk. The summary of prices was included in the April issue of Upper Midwest Dairy news, released by the Upper Midwest Federal Order office.
The monthly differences in the Upper Midwest Order (UMO) ranged from $0.24 above in July to $1.29 higher in November. The UMO annual average price was $0.83 above the all market average, while Minnesota was $0.25 higher and Wisconsin was $0.64 above.
The UMO annual average was the third highest price in 2017, behind only the New England State ($18.65) and Florida ($18.96) averages. Wisconsin farmers received the fifth highest price, while Minnesota settled to the middle of the pack. States receiving the lowest prices include New Mexico ($15.24) and Michigan ($15.59).
Mailbox price per year (Photo: Source: USDA-AMS Dairy Program)
With most dairy farmers experiencing a $17 to $18/cwt., 2017 was looked upon as a break-even period. Mailbox prices averaged $15.95 in 2016, the lowest average in the past 10 years with only 2009 being average lower at $12.82.
California posted an annual average mailbox price of $16.19 in 2017, despite the Golden State not a part of the Federal Order system. On March 30, the USDA published a final decision to establish a Federal milk marketing order that would incorporate the entire state of California.
USDA is holding a referendum through May 5, among dairy producers to determine whether they support the proposed FMMO. The Order needs a two-thirds vote to pass.
By: Colleen Kottke
Source: Wisconsin State Farmer