Dairy data releases in the last two weeks included some encouraging signs of herd recovery and bearish stocks numbers.
Last Monday’s USDA Milk Production Report showed a modest uptick in the 24-state cow number to 8,796,000 heifers. The total U.S. herd was about flat, but the 24-state number is hinting at stabilization and likely growth in the herd after nearly two years of culling.
Production exceeded expectations with September 2019 yield averaging 33 lbs of production per cow, up from September 2018, and with Q3 milk output up 0.5 percent YOY.
Reinforcing the bearish herd stats, cold storage inventories released the following day showed record levels of butter and high inventories of cheese nationwide. The high inventories are likely a result of stalled exports due to ongoing trade disputes and tariffs and continued high production levels.