2011 California butter, NFDM manufacturing costs lower, but cheese costs up

California’s Department of Food and Agriculture (CDFA) released its annual report on dairy product manufacturing costs, noting 2011 weighted average costs to produce butter and nonfat dry milk were down from a year earlier, but the cost to produce cheese was up.

• The 2011 average cost to produce cheddar cheese was 20.29¢/lb., up 5.62% from 19.21¢/lb. in 2010 and the highest cost per pound since 2008. It compared to 19.66¢ in 2009; 20.99¢/lb. in 2008; 20.03¢/lb. in 2007; 19.88¢/lb. in 2006; and 19.14¢/lb. in 2005.


• The average all cheese yield decreased to 12.21 lbs. per hundredweight of milk in 2011, compared to 13.70 lbs./cwt. in 2010; 13.28 lbs./cwt in 2009; 13.58 lbs./cwt. in 2008; 13.71 lbs./cwt. in 2007; and 12.24 lbs./lb. in 2006.


• The 2011 average cost of manufacturing butter was 17.75¢/lb., down 0.34% from 17.81¢/lb. in 2010 and the lowest since 2008. Among eight plants, 2011 costs ranged from 17.28¢/lb. for the low-cost group to 18.62¢/lb. for the high-cost group (four plants each).


• The cost to produce nonfat dry milk was 19.42¢/lb., down 6.18% from 20.20¢/lb. in 2010 and  the lowest since 2008. Among nine plants, the 2011 range was 17.46¢/lb. for the low-cost group; 20.41¢/lb. for the medium-cost group; and 24.56¢/lb. for the high-cost group (three plants in each group).


The costs do not include the cost of raw milk, nor the cost of marketing the finished product.


The full report is is available on the CDFA Dairy Marketing Branch website. Visit http://www.cdfa.ca.gov/dairy/uploader/postings/manufacturingcost/.