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Dairy Producers Look for Positives in 2024

Dairy producers are optimistic 2024 will be better after recent rains offered the promise of more feed and forage production following back-to-back years of drought-related challenges, according to a Texas A&M AgriLife Extension Service expert.

Additionally, the initial passage of Congressional legislation, the Whole Milk for Healthy Kids Act, by the U.S. House of Representatives could signal an increase in demand nationwide, said Jennifer Spencer, Ph.D., AgriLife Extension dairy specialist and assistant professor in the Texas A&M Department of Animal Science, Stephenville.

The past two years have been very tough on Texas dairy producers due to drought. Lower numbers of cows and dairies in Texas reflect the challenging production and market conditions for producers, Spencer said. In 2022, there were 653,000 cows; in 2023, that number had fallen to 635,000. The number of dairies also decreased, falling below 300 at the beginning of 2024, down from 315 in 2022.

However, Spencer said Texas milk production rose in 2023.

“Our milk production per cow went up a little bit, and we are now the third highest milk-producing state in the nation, ranking only behind California and Wisconsin,” she said. “We went from producing 1.648 billion pounds of milk to 1.653 billion pounds from 2022 to 2023.”

Higher costs, falling prices

The largest hit dairy producers took in 2023 was from falling milk prices. Spencer said the uniform milk price fell from $23.68 per hundredweight in 2022 to $18.98 per hundredweight in 2023. And the price of cheese averaged about $2 per hundredweight below both of those.

“With those lower prices and the drought that was experienced for the past two years pushing feed prices higher, it has been very challenging for dairy producers to achieve break-even,” she said.

Spencer said 2024 could be a transition year. She expects a further decrease in dairy numbers, but an overall increase in Texas dairy herd size. The average herd size in East Texas is about 1,000 cows, and in Central Texas, herds are typically in the 1,500 to 2,000 cow range. In the High Plains, dairy herds average 5,000 cows or more.

Most Texas dairy cows are in the Panhandle and account for more than 75% of the state’s milk production. The No. 1 producing county is Hartley, accounting for approximately 19% of Texas’s milk production. By comparison, regions like Central and East Texas account for 15% and 3%, respectively.

Positives on the horizon

Despite challenges, many producers are optimistic about seeing what 2024 brings in the way of feed production and market demand, Spencer said.

“We are hoping for a better crop year, and with the latest precipitation, we don’t expect producers to be struggling as much as the past few years,” she said.

Aside from improved cropping conditions going into spring, the demand for Texas milk could also be heading in a positive direction.

Four different processing facilities are just opening or under construction in the state, which could increase demand for Texas milk. Cacique Foods, a cheese plant, opened in May in Amarillo, and construction of the Great Lakes Cheese Plant in Abilene is scheduled to be completed in late 2024. A milk processing plant in San Antonio to support H-E-B is under construction and scheduled to be completed in summer 2025, and Phase 1 of a Lubbock-based Leprino Foods cheese plant is scheduled to be completed in early 2026.

But the biggest help could come with the Whole Milk for Healthy Kids bill, passed in the U.S. House of Representatives with overwhelming bipartisan support in December. If the bill clears the U.S. Senate, it will return the use of whole milk in schools and greatly increase demand.

Overall, the dairy industry has seen positive trends nationwide as dairy product consumption increased from 538 pounds to 655 pounds from 2022 to 2023.

Technology continues to change dairies

Dairies across Texas are looking at technology more and more to help mitigate the ups and downs of market prices and higher costs. Technology ranging from health monitors to rumination collars are available to help producers manage cow production, and some dairies are integrating robotics to address labor shortages.

“It’s a large investment and learning curve for dairy producers, but if we face more labor shortages or rising minimum wages, these alternative technologies become worth the investment,” Spencer said. “Also, as the next generation of dairy owners move into leadership positions, they are more receptive to adapting the newer technologies.”

Another option dairy operators are looking at to help their bottom line is utilizing more beef-on-dairy breeding. Spencer said sexed semen allows dairy producers to maintain consistent replacement heifer numbers, so producers are looking to take advantage of the higher beef market. A crossed beef-on-dairy calf is valued higher, about $200 per calf at market versus $20 for a pure dairy calf.

“We also may see more dairy producers delve into keeping more of their beef-on-dairy calves and raising them to 800 pounds or so before selling them off,” she said. “Dairies are becoming more versatile.”

AgriLife Extension district reporters compiled the following summaries:

CENTRAL

Wind and sunshine dominated and began to dry out the wet soil conditions. Winter pastures, specifically ryegrass, started to grow well. Planted winter pastures were good and grazed. Stock tank levels were full, for the most part, but additional rain and runoff were needed to help drought conditions. Weeds emerged. Several wheat fields needed to be top-dressed before corn planting. Wheat continued to grow well, even with excessive moisture. Rust was beginning to show in light occurrences, and Hessian flies continued to be a concern. Cattle remained in good body condition, with producers feeding hay and other supplements. Weaned cattle were pulled.

Cattle remained in good body condition, with producers feeding hay and other supplements. Weaned cattle were pulled.

ROLLING PLAINS

Conditions across the district remained favorable last week. The previous week’s rain, snow and wintery mix helped improve soil moisture profiles for the district’s pastures and wheat fields. A few areas remained too wet and limited some farming activity. Both mature cattle and yearling calves on wheat pasture were in good condition. With the recent moisture and mild weather, some producers were able to reduce supplemental feeding over their cattle, which will help stretch already thin hay supplies going into spring.

COASTAL BEND

The weather has been warmer and drier across the district, allowing cropland to dry out a bit. Some of the reporting areas had 0.5 to 1.5 inches of rain, which continued to help soil moisture conditions. Fall fieldwork resumed on lighter, sandy soils, while clay soils were still saturated after recent rainfall. Farmers prepared equipment and got in seed, and some sprayed weeds and cleaned ditches. Corn planting was underway in areas where conditions dictated, and it was nearing completion in Nueces County. Sorghum planting commenced with good soil moisture available. Pasture conditions continued to improve daily with good moisture and increasing temperatures, although there remained a lot of wet ground in the district. Producers continued supplemental feeding their herds, which kept the cattle in fair to good condition. Market prices were high with low inventory.

EAST   

Winter pasture growth improved with recent moisture and warmer temperatures. Heavy rains continued to fall in some areas. Anderson County reported pastures were too wet to work for the most part. Pasture and rangeland conditions were fair to poor. Subsoil and topsoil conditions were adequate. Ponds and creeks were full, with some running over the spillway. Cattle prices were high; some areas had low numbers due to rain. Hay supplies remained tight. Livestock were in fair to good condition, with supplementation taking place. Wild pig activity continued to increase.

SOUTH PLAINS

The district received 2-10 inches of snow earlier in the week. The heavier snowfall totals were in the northern half of the district. Winter wheat that emerged was in good condition. Cattle were in good condition as producers continued supplemental feeding.

PANHANDLE

As much as 4 inches of wet snow swept across different areas of the district. The response from wheat growth was evident as soon as soil temperatures began to increase. Producers started some pre-plant tillage for summer crops. Daytime temperatures gradually increased. However, additional moisture was needed to replenish the upper soil moisture profile, especially in fields planted with small grains, cover crops, or improved and native grass pastures. Supplemental feeding continued for cattle on range. Overall, soil conditions were reported from adequate to short. Pasture and rangelands were reported to be fair to very poor. Winter wheat was reported as good to fair.

NORTH

Topsoil and subsoil were reported as adequate to surplus for most counties across the district. Pasture and rangelands were reported to be fair to good for most counties within the district. The warmer temperatures allowed pastures to green up. Some counties received sporadic rain over the past week. Winter wheat and other cool-season crops were in very good condition. Ryegrass should be growing within the next few weeks, but the warmer temperatures brought about some growth of volunteer ryegrass in some areas. Livestock were looking for green forage instead of holding close to hay. Livestock conditions were good. The cutworm population was very low, with no significant insects or diseases to report.

FAR WEST

Cool, cloudy conditions were prevalent across the region. Daytime highs were reported in the mid-70s, and nighttime lows in the mid-20s. Conditions remain very dry and hard. A cold front moved through the area over the weekend, followed by seasonally warmer temperatures. Producers prepared the ground to plant and started drip irrigation for cotton and alfalfa. Wheat was growing and preparing to bloom. Cotton and milo production was expected to be lower than average. Livestock and beef cattle producers continued supplemental feeding regimens as rangeland conditions continued to deteriorate due to lack of moisture. Kidding season continued for goats and lambs. A few small-scale wildfires were reported as winds were high and conditions continued warming up.

WEST CENTRAL

Rain was scattered across the district, with some areas receiving over 2 inches. Temperatures were found in the lower 30s to lower 80s. Small grains were growing slowly. Wheat and oats were improving each week. Field preparation for spring crops began. Many stock tanks and ponds caught water from the recent rain, but more was needed to replenish it fully.

SOUTHEAST    

Rain fell across multiple counties in the district, and warmer temperatures spurred ryegrass and clover growth. Moisture was good in the pastures, and producers started spraying fields and preparing for spring. Current rainfall replenished stock tanks and ponds. Rangeland and pasture ratings varied from excellent to poor. Livestock appeared to be in good body condition, and markets remained strong. Cattle held good condition as producers continued heavy supplemental feeding for their herds. Local markets opened with a need for all classes of calves and yearlings.

SOUTHWEST

Dry weather continued with no significant rainfall expected and near-normal temperatures anticipated in the upcoming week. Most pastures were still in winter dormancy, but cool-season grasses and forbs were thriving. Overgrazed pastures were filled with annual winter forbs, including bluebonnets and wild mint. Conditions were expected to remain ideal for early spring planting for the rest of February. Oats and wheat looked good to excellent, and livestock markets held high to steady. Corn planting was set to start soon, and producers continued supplemental feeding their livestock and wildlife. Landowners were preparing to seed pastures. Rivers and creeks were noticeably elevated but not enough to fill dry creeks.

SOUTH

Widespread rain and warmer temperatures allowed rangeland and pastures to grow. The rain was timely for producers who recently applied fertilizer to their crops. Producers were preparing soil for planting the next crop season. Sunflowers and corn were being planted in some counties. Cotton and sesame crops still needed to be planted. Onion crops were looking exceptional. Producers continued supplemental feeding their livestock and wildlife. Prices remained strong and steady for all classes of beef cattle.

Source : tamu.edu

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