What is going on in the milk market(s)? How do we breed for income now?

 

The latest milk report from Co-Bank’s Corey Geiger indicates that the price of butterfat dropped 25% of its value since 2025 began.    This ends eight years in which butterfat exceeded the price for protein.    Meanwhile, this year, the price for protein has started to climb; it now exceeds the butterfat price by $0.75.     Does this mean we should change any of our breeding focuses?

The three  highest heritable traits measured are Lactose %, Protein %, and Butterfat %.   While we do not get paid much for “lactose” (milk sugars),  under component pricing formulas it is the Protein and Butterfat yields that account for over 85% of your total milk check.  Your most direct route today to increasing your milk check pay price is to select in favor of both PTA pr% and PTA bf%  (not pounds, as you have been told by everyone for decades.  I will explain why.)

Let us say you already produce 80 pounds per cow daily.    Following industry recommendations you feed a total ration that is “balanced”-- between forages (component stimulants) and grains (fluid stimulants).    Encouraged to reach higher pounds yields, you add more energy dense feed stuffs (maybe oilseeds, maybe bypass proteins).   Added energy density inputs increase the cost of the ration.   Do we get more components, or do we just get more milk, at the same bf% and pr% levels as before?   An extra 5 pounds of milk per day might mean 0.20 pounds butterfat and 0.15 pounds of protein to sell—worth (0.2 x $1.80) + (0.15 x $2.30) 70 cents per cow per day.  If your hauling costs (priced on pounds) are $2.00/cwt, deduct 10 cents for added weight; the net income gain (before added feed costs) is then 60 cents per cow daily.

If instead we accept the yield pounds we currently produce, but concentrate on raising percent of salable components, using bulls +0.15% butterfat and +0.10% protein, we gain 12 pounds of butterfat (worth $1.80 x 12 = $2.16) and 8 pounds of protein (worth $2.30 x 8 = $1.84) which is a total of $ 4.00 per cow per day.  There is no added hauling (same pounds total weight) and if your ration stayed the same, your feed costs stay the same.     Why do we get more?   Because in selecting directly for percent of components, we alter all 80 pounds of the cows’ daily yield, not just the incremental 5 pounds (what you can expect from more energy density)…

This explains why many western dairymen have switched from Holsteins to Jerseys over the last two decades.    With fluid utilizations at 40% or less, and skim milk jugs selling at a loss in major supermarket chains, these dairymen figured out producing more pounds was working against them.    They chose instead to switch to production models that produce more value.

Here are examples of  “more value”  bulls -- for surviving milk price fluctuations

525 HO 146   Garden-State Feature- P *RC   (aAa: 423615  “Strong, Tall, Open”)
He is that rare combination of A2A2 for Beta Casein and BB for Kappa Casein
His Butterfat % rating is +0.15%  (95 pctile)   and his Protein % rating is +0.12%  (99 pctile)
His calving  ease is 2.4% which is an acceptable level – generally safe for heifers.
His dam, with 145,077 pounds of 4.4% butterfat and 3.7% protein lifetime production, is a
sixth generation “Excellent” rated cow who goes back maternally to the “Finesse” family.

515 HO 402   Siemers Tao Prada              (aAa:  561432  “Smooth, Style, Dairy”)
Again, we have that rare combination of A2A2 for Beta Casein and BB for Kappa Casein
His butterfat% rating is +0.15%   (95 pctile)   and his Protein % rating is +0.08%  (90 pctile)
His calving ease is 2.3% which is acceptably safe for heifers.
His DPR rating is +1.9% -- which among bulls plus for PTA Milk is exceptional.
He also shows a +1.41 linear score for teat length--  also exceptional when so many modern bulls seem to shorten teats to the point where milking claws fail to stay attached.
His dam is a third generation of cows producing over 1000# protein and 1500# butterfat—that means over $5000 in milk check income for a single lactation!

515 HO 516   Ar-Joy El Fenomeno -PP        (aAa:  426531  “Strong, Tall, Style”)
Not only homozygous polled but another source of A2A2 Beta Casein and BB Kappa Casein
His butterfat % rating is  +0.06%  and his protein % rating is +0.04% 
His calving ease is also 2.3%  which is in the safe range for heifers.
Maternal grandsire “Parfect” is starting to show up in pedigrees of better conformation sires;
“Fenomeno PP” has a PTA Type of +2.05 which is exceptional among “pure polled” AI sires

Each of these three have physically sound physiques with durability in their leg structures.