Dairy Industry Snapshot

Special Note – Farm Credit East continues to closely monitor the latest developments on Highly Pathogenic Avian Influenza (HPAI) in Dairy Cattle:

• HPAI has been confirmed in dairy cattle in multiple US states, with 5 states affected in the last 30 days (Colorado, Idaho, Michigan, South Dakota and Texas as of August 29). There are, as of publication, no known cases in the Northeast. 
• While wild migratory birds are believed to be the initial source of infection in Texas, subsequent infections now appear to be linked to cow-to-cow spread, movement of infected cattle and indirect transmission due to human and equipment vectors. 

• Initial testing has not found changes to the virus that would make it more transmissible to humans. While cases among humans in direct contact with infected animals are possible, this indicates that the current risk to the public remains low. Human infection has been rare, however, farmworkers and service providers should exercise caution among sick or dead birds and infected animals. This includes wearing PPE and disinfecting following exposure. There have now been a total of 4 known human infections, all in persons with prolonged close contact with cattle, and all cases have been fairly mild.

Preventing the Spread:

• Farmers should exercise increased biosecurity protocols, including any farm visitors or service providers. This may include using disposable booties, gloves, and possibly additional PPE depending on level of contact with animals.  

Industry Impact:

• USDA is encouraging producers and veterinarians to minimize dairy cattle movement. At this time, they expect that minimizing movement, upholding good biosecurity practices, and testing animals before necessary movements will limit disease spread sufficiently to avoid the need for regulatory restrictions or quarantines. Unlike in poultry flocks where HPAI is fatal, among the dairies whose herds are exhibiting symptoms, the affected animals have recovered with little to no associated mortality reported.
• At this stage, USDA does not anticipate the need to depopulate dairy herds if infections are found. Unlike HPAI in birds which is typically fatal, little to no mortality has been reported and the animals are reportedly recovering. The affected cows on the dairy farms are currently being isolated from other animals. Transparency and collaboration with and by dairy producers will be important to mitigate broader potential impacts to the industry.
• Federal regulations now require testing of lactating dairy cattle prior to interstate movement. Positive tests of HPAI must be reported. 

• Because milk and dairy products are pasteurized before entering the market, there is no concern about the safety of the commercial milk supply, or that this circumstance poses a risk to consumer health. Testing has shown that the H5N1 virus is easily killed via commercial pasteurization.
• USDA is also confident that the beef and veal supply is safe. As always, USDA encourages consumers to properly handle raw meats and to cook to a safe internal temperature. Cooking to a safe internal temperature kills bacteria and viruses, like influenza, in meat.
• Despite the safety of the food supply, there is some concern regarding consumer reactions and whether this may affect demand for dairy products. 
  

• The national milk cow herd has fluctuated in size a bit but remains below last year’s average. The national milk cow herd was at 9.325 million head in July, down slightly from the prior month, and below the 2023 average of 9.386 million head. Milk production per cow was flat from the prior year. 
• New York was flat in terms of cow numbers from this time last year, and production per cow was off slightly, resulting in a decline in milk production of -0.2%. Nationally, states with declines outnumbered states with gains. California (-0.3%), Idaho (-1.0%), Michigan (-0.9%), New Mexico (-8.9%), Pennsylvania (-0.2%), Vermont (-3.7%), and Wisconsin (-0.1%) showed declines, while some smaller states showed modest increases.
• Feed and fuel costs have declined over the last year, but other input costs have risen. Meanwhile, milk prices have also increased, but only modestly. Income-over-feed cost calculations, such as the DMC margin, look much better than last year, but overall producer margins remain tight due to increases in non-feed costs. 

¹ Agri-Mark Price Forecast
² Upstate Niagara Price Forecast
³ USDA World Agricultural Supply and Demand Estimate (WASDE)