Missouri Dairy Business Update  
Volume 10, Number 10
October 2010

Milk Prices

According to Robert Cropp's Dairy Outlook, "As of now the Class III price may dropped below $15 by December and be in the low to mid- 14’s during the first half of 2011 and then strengthen during the second half. But, substantially higher corn and soybean meal prices as well as higher alfalfa hay prices for many states will lower returns over feed costs. This could increase dairy cow slaughter as well as dampen increases in milk per cow that result in higher milk prices, particularly for the second half of 2011. But, recent history shows that milk prices are very sensitive to relatively small changes in either or both of milk production and milk and dairy product sales (domestic and exports)."

Futures on the Chicago Mercantile Exchange
10-22-2010 Oct Nov Dec Jan 11 Feb Mar Apr May June July
Class III Milk (per cwt.) $16.88 $15.83 $14.89 $14.19 $14.07 $14.02 $14.03 $14.00 $14.20 $14.52
Class IV Milk (per cwt.) $16.85 $15.90 $15.34 $14.71 $14.28 $14.24 $14.25 $14.19 $14.21 $14.21
Butter (per lb.) $2.19 $1.99 $1.83 $1.66 $1.62 $1.62 $1.62 $1.62 $1.62 $1.62
Source: CME

Current USDA Milk Price Forecasts
10-22-2010 3rd Q 2010 4th Q 2010 1st Q 2011 2nd Q 2011
Class III Price $15.06 $16.45 to $16.85 $14.70 to $15.40 $14.40 to $15.40
Class IV Price $16.04 $16.55 to $17.05 $14.95 to $15.75 $14.10 to $15.20
Source: USDA, ERS, Livestock, Dairy & Poultry Outlook


Historical Missouri milk prices may be found at: http://agebb.missouri.edu/dairy/mkt/index.htm



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