The Meteoric Rise Of Texas Milk Production
While much has changed in the US dairy industry since 2000, at least one thing has stayed the same: the top 10 milk-producing states remained the same in 2020 as they did in 2000. Those 10 states, in order of their 2000 milk production, are as follows: California, Wisconsin, New York, Pennsylvania, Minnesota, Idaho, Texas, Michigan, Washington and New Mexico.
There have been several changes within that list, including, among others, the rise of Idaho to the number three spot and the fall of Pennsylvania to seventh. But one of the more intriguing recent changes is the rise of Texas to fifth, with further moves up the rankings likely in the very near future.
Indeed, Texas made just such a move, albeit just for one month (so far) in March, when it moved past New York into fourth place in milk production.
Granted, Texas topped New York in March milk production by just 9 million pounds, but the states produced the same amount of milk in February and Texas outproduced New York by 25 million pounds during the first quarter, after falling short of New York by just 13 million pounds in the fourth quarter of 2020.
So it seems likely that Texas will end the year in fourth place in US for producing milk, dropping New York into fifth place.
One of the more notable aspects of this climb up the milk-production rankings is that it isn’t the first time this has happened with Texas. Back in 1994, Texas set a new milk production record of 6.2 billion pounds, up more than a billion pounds from 1989 and good enough to move Texas into the number six spot in milk production, trailing California, Wisconsin, New York, Pennsylvania and Minnesota (the top 10 milk-producing states that year also included Michigan, Washington, Ohio and Iowa).
But then the bottom fell out of Texas’s milk production, which dropped by more than a billion pounds in less than a decade, to 5.1 billion pounds in 2001. That was the state’s lowest level of milk production since 1988’s 4.9 billion pounds.
Since then, Texas has been on a milk production tear. There are at least three ways to illustrate this point.
First, following that 2001 production low, it took Texas just four years to break its 1994 record; the state’s milk production reached 6.44 billion pounds in 2005, up more than 1.3 billion pounds from 2001 and up 219 million pounds from that 1994 record.
Second, since 2001, milk production in Texas has declined just two times, and in both instances the declines were miniscule: 2010 milk production was down 12 million pounds from 2009, and 2015 milk production was down 9 million pounds from 2014.
Third, and most impressive, Texas hasn’t just increased its milk production almost every year since 2001, it has posted some mighty eye-opening increases since then. For example, the state’s 2008 milk production was up more than a billion pounds from 2007.
But it is what has happened with milk production in Texas just in the past four years that is really impressive. In 2016, the state’s milk production totaled 10.8 billion pounds. Production increases over the next four years were as follows: 2017, 1.28 billion pounds; 2018, 806 million pounds; 2019, 990 million pounds; and 2020, 981 million pounds.
In other words, Texas since 2016 has increased its milk production by an average of more than 1 billion pounds per year. And the state went from seventh to fifth place in milk production, passing both Pennsylvania and Michigan.
A milk production increase of this magnitude leads to several questions. First, why exactly is milk production in Texas rising so rapidly?
There are probably numerous reasons why milk production is expanding rapidly in Texas, but we’ll mention one factor that likely isn’t playing a role: milk prices. Simply put, mailbox milk prices in western Texas (the region reported by USDA in its mailbox milk price series) have been lower than the average for all federal orders in four of the last five years; the exception was in 2020, when the mailbox price averaged slightly above the average for all federal orders.
A second question is: where is all of this additional Texas milk going? Here again, the answer is pretty complicated. One place this additional Texas milk doesn’t appear to be going is into Class I products; in 2020, a total of 4.16 billion pounds of milk in the Southwest federal order (basically Texas and New Mexico) was used in Class I, down from 4.35 billion pounds in 2010.
Instead, it’s going into Class II (utilization grew from 725 million pounds in 2010 to 1.45 billion pounds in 2020) and Class IV (utilization grew from 1.1 billion pounds in 2010 to 5.25 billion pounds in 2020). The volume of milk used in cheese also likely grew significantly over the past decade, but most of that Class III milk was depooled over the last couple of years and so it doesn’t show up in official federal order statistics.
A final question regarding milk production in Texas is: where to from here? At least in the short run, Texas milk production is going to keep growing; the state’s milk cow numbers in March were up 27,000 head from a year earlier and up 2,000 head from a month earlier. Even with small declines in per-cow output, Texas milk production will keep growing, and it seems likely that, maybe by 2022, Texas will become the number three milk-producing state.
The bottom did fall out of Texas milk production in the late 1990s, but right now it looks like the sky’s the limit for the Lone Star State…
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Source: Cheese Reporter