Milk Production: Milk production in the 23 major states during April totaled 17.4 billion pounds, up 0.3% from April 2018. Production per cow for April averaged 1,996 pounds. The number of milk cows was 8.71 million head, 1,000 head less than March 2019. March production was revised down 0.2% from preliminary estimates. For milk production in the top 5 producing states, California was up 2.6% from April a year ago; Wisconsin up 0.4%; Idaho up 2.2%; New York up 1.9%; and Texas up 6.7%. Other states with large production increases were Colorado (3.7%), South Dakota (1.8%), and Vermont (1.8%). The states reporting a large decline in production compared to April 2018 were Virginia (-11.0%), Illinois (-9.6%), Pennsylvania (-7.1), Florida (-5.5%), Ohio (-5.4%), and Arizona (-4.7%).
Milk Price and Utilization: The Southeast Uniform milk price for April was $18.70, no change from March and $1.82 higher than April 2018. The Appalachian Uniform milk price was $18.28, down $0.03 from March and $1.72 higher than April 2018. April’s Class III price was $15.96, up $0.92 from March, and $1.49 higher than April a year ago. The Class IV price was up $0.01 from March to $15.72, and $2.24 higher than April 2018. The Class I Mover price for June is $17.07, up $0.65 from May. The milk/feed ratio for April was 2.11, 0.03 lower than March.

Southeast Class I utilization was 67.16%, up 2.46% from March, and 2.14% higher than April a year ago. The Uniform butterfat price was $2.5622, down 0.72 cents from last month and 6.78 cents higher than April 2018. The April Class I price was $19.56. May Class I price is $20.22. Appalachian Class I utilization was 66.12%, up 1.43% from March, and 0.32% higher than April a year ago. The Uniform butterfat price was $2.5610, down 0.70 cents from last month and 6.53 cents higher than April 2019. The April Class I price was $19.16.
Cheese Production and Stocks: Total cheese production in March was 1.10 billion pounds, down 0.7% from a year ago while butter production was down 3.9% to 175 million pounds. Nonfat dry milk (NDM) production was down 8.0% compared to a year ago with total production at 164 million pounds while skim milk powder (SMP) production was up 17.9% to 49.6 million pounds compared to a year ago. Total cheese stocks at the end of April were up 4% from April a year ago and up 1% from the previous month while butter stocks were up 8% from last month and down 5% from a year ago.
Springer Prices and Cow Slaughter: At Smiths Grove, Kentucky on May 28, supreme springers were not tested and US approved springers brought $1,100, up $50 from last month. Dairy cow slaughter in April was 268,500 head, down 33,900 head from March and 21,600 more than April 2018.

Southeast Federal Order Prices
Month	Uniform Price $/cwt.	Class I Price $/cwt.	Class III Price $/cwt.	Class IV Price $/cwt.	Class I % Utilization	Butterfat Price $/lb.
Nov 18	18.71	19.32	14.44	15.06	78.39	2.5651
Dec 18	18.00	18.85	13.78	15.09	70.02	2.5328
Jan 19	18.27	18.92	13.96	15.48	75.94	2.5249
Feb 19	18.35	19.10	13.89	15.86	70.33	2.5348
Mar 19	18.70	19.78	15.04	15.71	64.70	2.5694
Apr 19	18.70	19.56	15.96	15.72	67.16	2.5622

Appalachian Federal Order Prices
Month	Uniform Price $/cwt.	Class I Price $/cwt.	Class III Price $/cwt.	Class IV Price $/cwt.	Class I % Utilization	Butterfat Price $/lb.
Nov 18	18.12	18.92	14.44	15.06	74.77	2.5635
Dec 18	17.45	18.45	13.78	15.09	66.57	2.5311
Jan 19	17.82	18.52	13.96	15.48	75.83	2.5240
Feb 19	18.00	18.70	13.89	15.86	72.11	2.5356
Mar 19	18.31	19.38	15.04	15.71	64.69	2.5680
Apr 19	18.28	19.16	15.96	15.72	66.12	2.5610

 
 
What is the Market Offering for Milk to be Sold in August?
Ex: It is May 30 and Aug. Class III milk futures are trading at $16.70. Local Aug. basis estimate is +$3.00.

If August futures				=	18.25	16.75	15.25
and actual blend price				=	21.25	19.75	18.25
Sample Strategies					Realized Prices for August Milk
1) Sold Futures		@	16.70		19.70	19.70	19.70
2) Bought Put	15.75	@	0.09		21.16	19.66	18.66
3) Bought Put	16.25	@	0.21		21.04	19.54	19.04
4) Bought Put	16.75	@	0.41		20.84	19.34	19.34
5) Synthetic Put
Sold Futures		@	16.70
Bought Call	17.75	@	0.09		20.11	19.61	19.61

 
What is the Market Offering for Milk to be Sold in September?
Ex: It is May 30 and Sep. Class III milk futures are trading at $16.95. Local Sep. basis estimate is +$3.00.

If September futures				=	18.50	17.00	15.50
and actual blend price				=	21.50	20.00	18.50
Sample Strategies					Realized Prices for September Milk
1) Sold Futures		@	16.95		19.95	19.95	19.95
2) Bought Put	16.00	@	0.14		21.36	19.86	18.86
3) Bought Put	16.50	@	0.28		21.22	19.72	19.22
4) Bought Put	17.00	@	0.49		21.01	19.51	19.51
5) Synthetic Put
Sold Futures		@	16.95
Bought Call	18.00	@	0.13		20.32	19.82	19.82