Missouri Dairy Business Update

Volume 13, Number 9
September, 2013

Milk Prices

According to the Bob Cropp's September Dairy Outlook, "USDA’s milk production report for August milk shows production to continue above year ago levels at 2.7% for the 23 states and estimated 2.6% for the US. This marks the fifth consecutive month of increases. However, milk production last year was slightly below year ago levels August through October so it is likely that milk production will continue above a year ago for the remainder of the year. Milk cow numbers may also be increasing. In recent weeks cow slaughter has fallen below a year ago and averages just 2.6% higher than a year ago year-to-date."

"With lower feed prices we can expect milk production at levels that will lower milk
prices going into next year. Further with some expected recovery in milk production by next year in the two leading exporters, New Zealand and EU countries we can expect some decline in US exports next year. Lower feed costs and lower exports spell lower milk prices next year."

Futures on the Chicago Mercantile Exchange
9-30-2013 Sep Oct Nov Dec Jan Feb Mar Apr May June

Class III Milk
($ per cwt.)

18.12 18.00 17.80 17.16 16.79 16.56 16.58 16.53 16.57 16.66

Class IV Milk
($ per cwt.)

19.41 20.19 20.10 19.40 18.48 17.95 17.76 17.30 17.30 17.40
Source: CME
Current USDA Milk Price Forecasts
September 18, 2013 4th Q 2013 1st Q 2014 2nd Q 2014 2014
Class III Price 18.40-18.90 17.00-17.80 17.20-18.20 17.05-18.05
Class IV Price 19.25-19.85 18.30-19.20 18.30-19.40 18.45-19.55
Source: USDA, ERS, Livestock, Dairy & Poultry Outlook

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