As printed in our September 25, 2014 issue...
DAIRY EXPORTS HAVE SPUTTERED as U.S. dairy product prices traded well above global levels, which has made exporting slightly more difficult. Since April, the value of U.S. dairy exports declined four straight months after posting a new benchmark in March at $717 million.
EVEN SO, U.S. INTERNATIONAL SALES were 22 percent ahead of last year's seven-month record pace at $4.5 billion compared to $3.7 billion.
AT $3 PER POUND, BUTTER SET A NEW HIGH in mid-September spot trading at the CME. At those levels, many analysts have projected the U.S. will experience stepped-up butter imports as a $1-plus spread exists between domestic butter prices and those in Oceania and Europe.
NEAR TERM FUTURES STOOD STRONG with October to December Class III contracts averaging in the low $21 range at press time. Next year's January to August contracts were off nearly $3.50 at $17.70.
USDA ALSO BEARISH as it lowered it's projected 2015 All-Milk price by 35 cents to a $19.90 midpoint. This year, the value could be $23.90.
GRAIN AND SOYBEAN PRICES TUMBLED to the lowest point in four years based on projections of record yields. In the last 30 days, USDA forecast an additional 400 million bushels of corn to raise the potential harvest to 14.4 billion bushels with a record yield of 171.7 bushels per acre.
THE CORN CROP HAS BEEN DOING WELL with 22 percent rated excellent and 52 percent rated good; soybeans were only off a collective 2 percentage points. That being the case, USDA projected a record soybean harvest at 3.9 billion bushels at 46.6 bushels per acre.
RECORD BEEF PRICES haven't caused consumers to back off of purchases. October to December live cattle futures ranged from $1.58 to $1.61 per pound in recent CME trading. Supplies should remain tight with the beef-cow herd at the lowest level since 1962.
DAIRY COW CULLING was off 212,000 head through August when compared to the same time last year. To date, 1.82 million dairy cows were sent to packing plants. And with the smallest beef calf crop since 1949, inventories should remain tight for the long term.
CHEESE CONSUMPTION notched a new record as Americans ate 33.5 pounds per person in 2013, reported USDA. The "other cheese" category (including Mozzarella) continued to lead the way at 20.1 pounds.
ON A MILK EQUIVALENT BASIS, each citizen consumed 607 pounds of dairy products making it the eighth straight year over 600 pounds; from 1970 to 2004 that threshold was only crossed once.
BRIEFLY: Each dollar invested in the Beef Checkoff returned $11.20, reported Cornell economists. Continental Dairy Products merged into the Select Milk Producers dairy cooperative