As printed in our June 2017 issue . . .
CLASS III FUTURES CLIMBED 15 CENTS during early April to late May trading to average $16.90 per cwt. for the remainder of 2017. June’s $16.20 was the lowest monthly contract with September’s $17.20, the high.
USDA SET ITS ALL-MILK PRICE AT A $17.60 midpoint for 2017, only down a nickel from one month earlier. Its 2018 opening projection was $18.05 with a range from $17.55 to $18.55 on a per hundredweight basis.
IN RAISING ITS PAYOUT 40 CENTS, New Zealand’s Fonterra Cooperative also expects stronger milk prices as its milk production season moved into the third quarter. That payout would be roughly $15.20 per cwt., or $6.15 per kilogram of milk solids. Its 2018 forecast is $16 or $6.50.
BUTTER DEMAND REMAINED STRONG GLOBALLY as European and Oceania prices surpassed U.S. values for the first time in well over a year. New Zealand’s GDT spiked to a record high, while Germany posted its highest value on a U.S. dollar basis since 2014. At the CME, butter traded near $2.40 per pound on the spot market.
CHEESE STOCKS SURGED as butter inventories waned in April. At 835 million pounds, American cheese in cold storage climbed 14 percent over the same time last year, while butter fell 1 percent to 292 million pounds.
APRIL MILK PRODUCTION JUMPED 2 PERCENT mainly on the strength of a growing national dairy herd of 9.39 million cows, the largest since 1996. Of the top 23 dairy states, 18 expanded milk flow.
A POTENTIAL CALIFORNIA Federal Milk Marketing Order cleared another hurdle as the state’s ag department agreed to administer its Class I quota system. With public comments closed, USDA will now review industry input and then issue a final decision on a California order.
AFTER USDA ISSUES ITS FINAL DECISION, a “yes” or “no” dairy producer vote would take place in California. If two-thirds vote in favor of the final decision, California would get a Federal Milk Marketing Order.
BOTH COSTS AND REVENUE FELL in California. It took $16.53 to produce 100 pounds of milk compared to $17.78 in 2015. All cost categories fell, except for labor. Mailbox milk prices netted $15.56 after averaging $15.94 just one year earlier. Income over feed cost improved 16 percent.CALIFORNIA JERSEY HERDS NETTED $17.88 for mailbox prices on expenses of $19.26 per cwt. Holstein herds garnered $14.57 with a $15.71 cost per hundredweight, reported the state’s ag department.
USDA’S BUDGET COULD BE CUT BY $231 BILLION over 10 years if President Trump’s budget would be enacted. Of that, $193 billion would be trimmed from food assistance programs, $28 billion in crop insurance, $6 billion in conservation programs, along with 5,263 USDA staff positions.
In your next issue!
HOW SAFE IS YOUR MILK CHECK?
While there are many good private dairy processors, don’t forget that private companies have a very different commitment to market and payment security than co-ops.
COMPARING COMPOST TO SAND.
Can compost-bedded pack barns hold their own against sand-bedded freestalls?
GET A GRIP ON STILLBIRTHS.
Although there is good data on what factors lead to stillbirths, we haven’t been able to eliminate them from dairy farms.