More than 5% of U.S. dairy herds closed their doors in 2021, but that was the slowest rate of decline in four years. The annual USDA Milk Production Report summarizing the previous year was published on February 23, 2022.
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The average dairy herd size reached a record high of 316 head in 2021. (Adobe Stock)

The USDA started tracking metrics for licensed dairy herds in 2003. At that time, there were 70,375 herds in the country. In 2021, that number dropped below 30,000 to 29,858. The past year saw an exit of 1,794 herds nationwide, or 5.7% of the country’s total.

But the herd-number declines in the three previous calendar years were worse: 2,731 (6.8%) in 2018; 3,281 (8.8%) in 2019; and 2,535 (7.4%) in 2020. Over the last 20 years, the U.S. has lost an average of about 2,300 herds per year.

Meanwhile, dairy cows numbers stay relatively steady; average herd size grows; and per-cow and total milk production have increased. Through 2021, the average number of milk cows for the nation’s total dairy herd grew by 0.6% to 9.45 million head.

The average dairy herd size reached a record high of 316 head in 2021. It’s a number that has grown steadily from the starting point of 129 cows in 2003. New Mexico has the largest average per-head herd size at 2,752, followed by Arizona, Colorado, and Texas. The state with the smallest average herd size: Pennsylvania, at 93 cows per herd.

Production per cow increased year-over-year by 171 pounds to an average of 23,948 pounds per head. Total milk production climbed 2.9 billion pounds to a record total of 226 billion pounds in 2021.

At the state level, Texas is the big story, as it bumped out New York for the #4 spot in total milk production in 2021. New York produced 15.5 billion pounds of milk in 2021, while Texas edged out the Empire State with 15.6 billion pounds. California retains top milk-production spot, followed by Wisconsin and Idaho.

South Dakota is another significant growth story. While ranked #17 among states for milk production, the industry there is growing at a rapid pace, thanks to a burgeoning cheese manufacturing industry in the I-29 corridor.

The Mount Rushmore State produced 12.0% more milk year-over-year in 2020 and 15.5% more in 2021. That 2021 production was generated by 21,000 more cows from 15 fewer herds.

States losing the most dairy herds in 2021 were Missouri (-9.7%), Iowa (-8.8%), and Ohio (-7.2%). In terms of actual number of herds lost, Wisconsin topped the list with 340, followed by Pennsylvania and New York. Those three states made up more than half of the total number of licensed herds lost in 2021 nationwide.

At the midpoint of the year, the all-milk price forecast for 2022 is a whopping $26.20 per hundredweight (cwt), according to the June 2022 USDA/ERS Livestock, Dairy and Poultry Outlook report.

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