Milk Prices, Costs of Nutrients, Margins and Comparison of Feedstuffs Prices

April F. White, Graduate Research Associate, Department of Animal Sciences, The Ohio State University

Milk prices

In the last issue, the Class III futures for May and June were at $18.93/cwt and $17.63/cwt, respectively. Class III closed slightly lower than predicted at $17.21/cwt in June, with protein continuing to decline in price from $2.81/lb in May to $2.51/lb in July. The Class III future for August is $16.50/cwt, followed by a slight increase to $16.66/cwt in September.

Nutrient prices

It can be helpful to compare the prices in Table 1 to the 5-year averages. The price of NEL and peNDF are about 37 and 41% higher than the 5-year averages ($0.08/Mcal and $0.08/lb), while MP is 2% below the 5-year average ($0.38/lb). The price of MP in the SESAME model using this week’s feed prices is very close to the 5-year average, although the prices of many feeds providing protein to the ration continue to be higher than they were this time last year.

To estimate profitability at these nutrient prices, the Cow-Jones Index was used for average US cows weighing 1500 lb and producing milk with 3.9% fat and 3.2% protein. For July’s issue, the income over nutrient cost (IONC) for cows milking 70 lb/day and 85 lb/day is about $9.33 and $9.87/cwt, respectively. Both estimates are likely to be profitable, although they are lower than in May. As a word of caution, these estimates of IONC do not account for the cost of replacements or dry cows, or for profitability changes related to culling cows.

Table 1. Prices of dairy nutrients for Ohio dairy farms, July 21, 2021.

Economic Value of Feeds

Results of the Sesame analysis for central Ohio on July 21, 2021 are presented in Table 2. Detailed results for all 26 feed commodities are reported. The lower and upper limits mark the 75% confidence range for the predicted (break-even) prices. Feeds in the “Appraisal Set” were those for which we didn’t have a local price or were adjusted to reflect their true (“Corrected”) value in a lactating diet. One must remember that SESAME™ compares all commodities at one specific point in time. Thus, the results do not imply that the bargain feeds are cheap on a historical basis. Feeds for which a price was not reported were added to the appraisal set for this issue.

Table 2. Actual, breakeven (predicted) and 75% confidence limits of 26 feed commodities used on Ohio dairy farms, July 21, 2021.

For convenience, Table 3 summarizes the economic classification of feeds according to their outcome in the SESAME™ analysis. Feedstuffs that have gone up in price based on current nutrient values or in other words moved a column to the right since the last issue are in oversized text. Conversely, feedstuffs that have moved to the left (i.e., decreased in value) are undersized text. These shifts (i.e., feeds moving columns to the left or right) in price are only temporary changes relative to other feedstuffs within the last two months and do not reflect historical prices. Feeds added to the appraisal set were removed from this table.

Table 3. Partitioning of feedstuffs in Ohio, July 21, 2021.

Bargains At Breakeven Overpriced
Gluten meal Whole Cottonseed Mechanically extracted canola meal
Corn, ground, dry

Feather meal

41% Cottonseed meal
Corn silage Soybean hulls Soybean meal - expeller
Distillers dried grains Wheat bran

44% Soybean meal


48% Soybean meal

Solvent extracted canola meal
Gluten feed Alfalfa hay - 40% NDF

Meat meal

  Wheat middlings

Whole, roasted soybeans

As coined by Dr. St-Pierre, I must remind the readers that these results do not mean that you can formulate a balanced diet using only feeds in the “bargains” column. Feeds in the “bargains” column offer a savings opportunity, and their usage should be maximized within the limits of a properly balanced diet. In addition, prices within a commodity type can vary considerably because of quality differences as well as non-nutritional value added by some suppliers in the form of nutritional services, blending, terms of credit, etc. Also, there are reasons that a feed might be a very good fit in your feeding program while not appearing in the “bargains” column. For example, your nutritionist might be using some molasses in your rations for reasons other than its NEL and MP contents.


For those of you who use the 5-nutrient group values (i.e., replace metabolizable protein by rumen degradable protein and digestible rumen undegradable protein), see the Table 4.

Table 4. Prices of dairy nutrients using the 5-nutrient solution for Ohio dairy farms, July 21, 2021.