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Iowa-Nebraska January dairy budgets worsen

 

Iowa-Nebraska January dairy budgets worsen
January 2013 dairy budgets got a little worse compared to December 2012 in Iowa and Nebraska, even though total costs declined, according to Robert Tigner, Extension Educator. 
Total variable and fixed costs dropped 44¢/cwt. from December, to $20.44/cwt., with corn, soybean meal and hay prices down slightly. The budgeted break-even price for a freestall dairy with a 24,000-lb. rolling herd average (RHA) dropped by 21¢, to $22.69/cwt.
However, the January 2013 milk price of $19.98/cwt. was down $1.06 from December, and dn estimated 11.41¢/cwt. Milk Income Loss Contract (MILC) payment wasn’t enough to offset that decline. The January federal order producer price differential (PPD) was slightly lower, but cull cow prices were slightly higher.
Based on this budget, herds producing 24,000 lbs. of milk per cow per year saw a $2.12/cwt. return over variable and fixed costs. But, adding labor and management, producers realized a loss of $2.48/cwt. for January.
Current trends: The January total costs per hundredweight and break-even price for the 24,000-lb. RHA freestall herd are the lowest since August 2012; the actual milk price is the lowest since September 2012.
Contact Tigner at robert.tigner@unl.edu.
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