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 August and September were $20.67/cwt and $20.21/cwt, respectively. Class III milk closing price for August was $20.10/cwt, with protein and butterfat prices at $2.14/lb and $3.40/lb respectively. The component price for protein is reduced from the July issue, and butterfat price continues to increase alongside demand as the holidays approach. This issue, the Class III future for October is $21.95/cwt, and the November future is $20.92/cwt.

Updated Corn Silage Price

A new corn silage price used throughout this article was calculated this month as corn silage harvest winds down across Ohio. This year’s approximate price for normal corn silage (32 to 38% dry matter), based on a $6.70/bu corn grain price at end of day September 28, 2022, is $71.81/ton. Due to the increased December corn futures this year, corn silage has once again increased in value by ~$11/ton compared to 2021 season ($60.71/ton). However, based on its nutritive value, home grown corn silage continues to be a bargain feed in dairy cattle rations.

Nutrient prices

It can be helpful to compare the prices in Table 1 to the 5-year averages. Since the July issue, the price of metabolizable protein (MP) has increased by about 17% alongside a 22% decrease in the price of net energy for lactation (NEL). The current price of NEL and MP are about 15 and 30% higher than the 5-year averages ($0.08/Mcal and $0.41/lb, respectively). These nutrient costs continue to reflect recent trends in ingredient costs, largely following swings in the cost of protein and energy ingredients.

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 the September issue, the income over nutrient cost (IONC) for cows milking 70 lb/day and 85 lb/day is about $11.52 and $12.12/cwt, respectively. Both estimates are likely to be profitable. 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, September 23, 2022.

Economic Value of Feeds

Results of the Sesame analysis for central Ohio on September 23, 2022 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 this issue.

Table 2. Actual, breakeven (predicted) and 75% confidence limits of 26 feed commodities used on Ohio dairy farms, September 23, 2022.

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, September 23, 2022.

Bargains At Breakeven Overpriced
Alfalfa hay - 40% NDF 48% Soybean meal Mechanically extracted canola meal
Feather meal Soybean meal - expeller Whole, roasted soybeans
Corn silage Wheat bran
Soybean hulls
Distillers dried grains Gluten meal 44% Soybean meal
Gluten feed Whole cottonseed Solvent extracted canola meal
Meat meal   Blood meal
Corn, ground, dry  
41% Cottonseed meal
Wheat middlings    

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 MP by rumen degradable protein and digestible rumen undegradable protein), see Table 4.

Table 4. Prices of dairy nutrients using the 5-nutrient solution for Ohio dairy farms, September 23, 2022.