By Sherry Bunting, published in Farmshine, March 4, 2022

WASHINGTON, D.C. — The U.S. produced 226.3 billion pounds of milk in 2021, up 1.3% compared with 2020, with 56,000 more cows and 1799 fewer dairy herds nationwide.

In fact, the average number of licensed dairy herds fell below 30,000 in 2021 — reported by USDA at 29,858, down 5.7% from 2020. This was less than the larger than average loss of 2550 dairies in 2020 and less than the 20-year average of 2300 exits annually.

The average number of milk cows for the year increased 0.6% in 2021 to an estimated 9.45 million head. Output per cow was slightly higher for the year, but slipped in the second half of 2021 compared with the previous year.

It is important to note that USDA’s annual data released on Feb. 23 computes the average number of cows and the average number of licensed dairy herds for 2021 compared with 2020. This is more like a rolling average for the year. These are not end-of-year numbers.

Furthermore, the landscape of change is getting the attention of some influential lawmakers ahead of 2023 Farm Bill discussions  as interest centers on the economic health of rural communities, and where Dairy thrives, it brings jobs and vitality.

2021 started out strong in production gains, but in the second half of the year, cow numbers began to shrink heading toward 2022, along with output per cow. 

The USDA semi-annual All Cattle and Calf Inventory Report, in fact, estimated 1% fewer milk cows on farms as of Jan. 1, 2022 compared with the previous year and 3% fewer dairy replacement heifers. That is significant compared to the higher 2021 average numbers.

Some of the data shown in the USDA production report raise questions about how milk production is counted and the reliance of NASS on Federal Milk Marketing Order data — given the significant decline in the percentage of U.S. milk production participating in FMMO pools today.

In 2011, an estimated 82% of total U.S. milk production participated in FMMO pools. This fell to 60% in 2021.

Looking over the data, the Eastern Seaboard saw declines in the number of herds, number of cows and in milk production for 2021. The exceptions were New York, Georgia and North Carolina in terms of production.

Starting with the Southeast, past data show the region held its own in 2020, but sustained collective losses of herds, cows and milk in 2021.

The two major reporting states of Florida and Georgia went in opposite directions. As Florida’s trends have pointed lower, Georgia dairies are expanding to take up some of the slack.

In Georgia, where the average herd size has grown by more than 300-head over the past four years, there was an average of 110 dairies in 2021, down by 20, but they milked 1000 more cows to produce 1.5% more milk. The average herd size grew to 745. January’s monthly milk production report shows Georgia is starting the year strong on production and cow numbers as well.

Innovation grants, avid promotion partnerships with retailers and a strong focus on heat stress mitigation, heat-resistance genetics and crossbreeding as well as programs for improved production per cow and milk quality throughout the Southeast are helping progressive herds in some areas take advantage of opportunities to grow or diversify, unless cooperative base programs get in the way.

By contrast, Florida’s dairy herd number fell to 75 in 2021, milking 5000 fewer cows and producing 5.1% less milk, with the average herd size stable at 1440.

North Carolina is not among the 24 major reporting states, but their annual production grew by 2.5%, according to the USDA report, even though they lost 5 dairies and milked 1000 fewer cows.

Virginia is among the 24 major reporting states, and annual production there fell by 3.4% as 54 fewer dairies milked 2000 fewer cows.

Kentucky and Tennessee each had 2000 fewer milk cows with production falling 3.4 and 6.3%, respectively, with 30 fewer dairy herds in Kentucky, 20 fewer in Tennessee.

Collectively, the Southeast region from Virginia to Florida to Arkansas totaled 1,531 licensed dairy herds in 2021 – down 199 (11.5%) from the 1730 reported in 2020. 

Cow numbers in the Southeast region declined by 15,000 head from 430,000 in 2020 to 415,000 in 2021.

During the Kentucky Dairy Partners conference in Bowling Green Feb. 23, John Newton, chief economist for the U.S. Senate Ag Committee Republicans talked about the upcoming 2023 Farm Bill and referenced these herd losses. 

The Kentucky native mentioned Senate Ag Committee Ranking Member John Boozman’s concern about the decline of dairy farms in the Southeast.

“One of the Senator’s dairy initiatives is to look at this. There are only 30 dairies left in his home state of Arkansas. They have lost nearly 90% of their dairies over the last couple of decades. He wants to figure out how to revitalize dairies in the Southeast,” said Newton referencing the secondary map showing the significant exodus.

“Sen. Boozman wants to look at how do we protect the Southeast dairy industry to grow and to revitalize these rural economies so our next generations are not leaving the farm for other economic opportunities,” Newton said, observing that broad band and available labor are two big issues the committee will look at that affect all rural communities.

“The Senator’s concern about revitalizing rural economies extends beyond the Southeast to other parts of the country as well,” said Newton. His map illustrated similar concerns in the Northeast and MidAtlantic region, and anyone drilling down into data for communities throughout the rest of the country can see consolidation is reaching a tipping point.

Pricing formulas and inequitable distribution of revenue could be playing a role and will be part of Farm Bill discussions that have already begun, said Newton. He encouraged Southeast producers to be thinking about a better way to price milk and bring it to the broader industry discussions because the outcome has to work for dairy producers in all regions.

The swath of states in the Central U.S. and West is where milk production has grown substantially — in many cases this occurred because state initiatives were set in motion a decade ago to specifically attract dairies and bring processing plant construction and jobs to the rural economies in those states.

The trend in the Southwest has hit some speed bumps in New Mexico and Arizona, but Texas, Kansas, and Colorado are still big gainers. The Upper Midwest and Central Plains are the areas of strong growth too in the past two to three years, followed by the Mideast region – all having seen the building or expansion of significant Class III or IV milk processing capacity owned jointly by cooperatives and global corporations.

Like the Southeast, the Northeast and MidAtlantic region held its own overall in 2020, but milk production fell across the region in 2021, except for New York.

New York’s production grew 1.6% in 2021 with 1000 more cows and 220 fewer dairies. 

However, Empire State was surpassed by the Lone Star State in total milk production. Rapidly growing Texas is now number four in the nation for milk production. New York is number five.

Among the other major reporting states in the Northeast and MidAtlantic milkshed, Pennsylvania’s production for 2021 was barely above 10 billion pounds and 1.6% lower than in 2020.

The number of dairy herds in the Keystone State in 2021 fell by 230 to 5200, and cow numbers fell by 8000 head to 472,000 for the year. In January, the monthly reporting shows the number of milk cows on Pennsylvania farms fell below 470,000 for the first time. 

Pennsylvania remains 8^th, having been surpassed by Minnesota for 7^th in 2020.

In Vermont, the number of licensed dairy herds in 2021 fell by 60 to 580, and 2000 fewer cows were milked — pushing production 1.4% below year ago.

Of the other states in the Northeast / MidAtlantic milkshed, New Jersey took an almost 11% hit on milk production while Rhode Island declined 7.3%, Delaware 4.3% and Maryland was more stable, down 0.7%, losing 20 dairies. The remaining New England states ranged 1.5 to 4.5% lower in milk production for 2021.

Moving west to the Mideast states of Indiana, Ohio and Michigan — where a huge new processing plant in Michigan became operational a little over a year ago — production grew 4.6% in Indiana, 2.3% in Michigan and 0.4% in Ohio with 24,000 more cows milked collectively in the tristate region on 220 fewer farms in 2021.

Wisconsin had a story of its own, where the 2021 milk production increase on a pounds basis set records after being lower for the year in 2020. The No. 2 dairy state lost more dairy herds than any other state, but the 340 exits were half the number seen a year earlier. 

The number of dairy herds in the Dairyland State fell to 6,770; however, those dairies milked 15,000 more cows, and milk production grew by 3.1% in 2021.

Just south in Iowa and Illinois, production split trends, down fractionally (0.7%) in Illinois, with 1000 fewer cows and 30 fewer dairies, but growing 3.1% in Iowa, with 8000 more cows and 85 fewer dairies.

Throughout the rest of the growing Central region, South Dakota produced 15.5% more milk with 21,000 more cows and 15 fewer dairies. Just east, Minnesota continued to grow milk production 3.7% over year ago in 2021, milking 13,000 more cows on 135 fewer dairies. To the west, Wyoming’s herd numbers were cut in half at 5, but those 5 dairies milked 1000 more cows and grew the state’s production by almost 16.6%. Colorado lost 10 dairies but gained 6000 cows and a 2.3% increase in milk production.

Rounding the bend in Kansas and Nebraska, the trends were split. Kansas saw production growth of 1.9% in 2021, milking 2000 more cows on 10 less farms. Nebraska’s production fell 2.5% on 1000 fewer cows.

In the Southwest, Texas continued its multi-year rapid growth pattern as production increased 5% with 27,000 more cows milked on 20 fewer dairies.

New Mexico was a different story. After holding somewhat steady in 2020, production fell by 4.5% in 2021. The big reason was the exodus of 12,000 cows from the state and the loss of 20 dairies. Arizona also lost cows and production, down 1.5% from a year ago.

The No. 1 dairy state for milk production, California grew milk output by 1.3% in 2021, with 3000 fewer cows and 20 fewer dairies.

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