News

CoBank report shows milk production outpacing processing capacity

A CoBank report says milk processors are struggling to keep pace with growing milk production.

Senior Dairy Economist Ben Laine tells Brownfield additional processing capacity has been built, but some regions have more production than processing capacity.  He says, “Particularly the northeast and Michigan, the mid-east, those regions are very heavy in production and they’re exceeding their capacity right now, so what tends to happen is that milk starts to flow to the west.”

And, he says processors are growing.  “There are a couple of powder plants that are still being built in the west and in the southwest.  There’s increasingly more interest in adding some cheese plants around the country, but especially in Michigan in that area where there’s a lot of surpluses.  There’s interest in building new plants there.”

 

Laine says the lower feed costs are continuing to drive expanded milk production, but lower milk prices during the last few years have given processors incentives to expand, too.

 

Laine says while fluid milk consumption has gone down, overall worldwide dairy consumption has gone up so there are opportunities to sell more dairy products.  He says Asia and the Middle East are growing markets.

Add Comment

Your email address will not be published.


 

Stay Up to Date

Subscribe for our newsletter today and receive relevant news straight to your inbox!