As printed in our June 2018 issue . . .
STRONGER PRICE PROJECTIONS for the second half of the year lifted All-Milk price prospects. Now pegged at a $16.45 midpoint, USDA raised its 2018 price forecast by 60 cents over the last month.
THE 2019 OPENING FORECAST had a $16.75 midpoint per cwt. for a U.S. All-Milk price. That included a price range of $16.25 to $17.25. New Zealand, the world’s leading dairy exporter, pegged a $16.40 payout.
CLASS III FUTURES averaged $16.70 for June to December contracts traded on the CME. That represented a $1.40 per cwt. improvement since early March. Near $17, September and October were the high months.
LOW PRICES FOR THE YEAR are clearly in the history books, projected Jerry Dryer, a leading dairy analyst. “Prices of all products and milk will increase; albeit in a choppy fashion through at least the third quarter.”
SLOWING MILK PRODUCTION, both in the U.S. and globally, as well as shrinking dairy product inventories, have “dramatically” eased downward pressure on product prices, commented Dryer of JDG Consulting.
MPP-DAIRY PAYOUTS to participating dairy farmers should occur for February to June milk. February and March benefits, based on the ratio of milk prices to feed costs, should more than cover premiums on the first 5 million pounds of milk. April payments will likely be higher than March.
A SIZABLE MAY PAYOUT could take place, with a modest benefit in June. Based on forecasts, there won’t be payouts the remainder of the year.
WHILE STILL AT 9.4 MILLION HEAD, milk cow inventories contracted to a five-month low in April. Cow numbers dropped by 19,000 head in California . . . the most of any state. Minnesota, Ohio, and Wisconsin also reduced their respective dairy herds by 5,000 cows each.
EVEN SO, CALIFORNIA GREW milk output by 0.4 percent, while Wisconsin fell 0.6 percent. Colorado and Texas led all gainers, up 9.9 and 7 percent, respectively. Of the top 23 dairy states, 11 reduced milk flow.
AFTER PEAKING AT 21.91 PERCENT market share in 2007, California has steadily lost ground to other states. It accounted for 18.47 percent of the nation’s milk last year. That represented the lowest total for the Golden State since 1999. Second-place Wisconsin produced 14 percent.
PRAIRIE FARMS WILL CLOSE its Fulton, Ky., fluid milk processing plant. That move will result in the elimination of 52 positions, the cooperative shared with the Kentucky Division of Workforce and Employment Services. It plans to maintain a distribution center there.
AFTER DISCOVERING MYCOPLASMA BOVIS on its South Island last July, New Zealand confirmed the first case on the North Island in May. To date, 39 herds have been affected by the devastating bacterial disease.
In your next issue!
WHAT IF WE GOT RID OF LIVESTOCK?
Cutting animal agriculture out of the picture leaves some large imbalances in the world’s food web.
The cows in your herd may have less space than you even realize.
THE U.S. PARTNERS WITH CHINA DAIRY MARKETS.
While Mexico remains America’s top dairy customer, China is the world’s leading dairy product importer. Growing that relationship will be critical.