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Feed costs up, but Pennsylvania IOFC improves for third straight month

Feed costs up, but Pennsylvania IOFC improves for third straight month
Pennsylvania’s November 2012 milk income over feed costs (IOFC) rose 1.9%, making it 62% higher than August levels, according to Penn State dairy economist Jim Dunn.
The November Pennsylvania all-milk price was up $1.00/cwt., to $23.80/cwt., the highest since August 2011. Higher hay prices (up 22%) offset falling corn and soybean prices, pushing feed costs up. At $6.29, average daily feed costs (at 65 lbs. of milk/cow/day) were up 40¢ from the previous month. IOFC for a cow producing 65 lbs. of milk per day was $9.18, up 17¢.
Measured another way, feed costs per hundredweight of milk produced averaged $9.68/cwt., resulting in a milk income margin over feed costs of $14.12/cwt., up 26¢ from October and the highest since September 2011.
Dunn forecasts the 2012 Pennsylvania all-milk price will average $19.90/cwt., increasing to $21.42/cwt. for the first half of 2013. Feed costs are still very high, but down considerably from their August peaks. However, given the apparent peak in milk prices in November, he does not expect Spring 2013 milk production to be as robust as in early 2012.
To read Dunn’s December Dairy Outlook, visit http://www.personal.psu.edu/faculty/j/w/jwd6/DairyOutlookdec12.pdf.
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