Missouri Dairy Business Update

Volume 16, Number 11
November 2016

Milk Prices

According to Bob Cropp's November Dairy Outlook, "Looking ahead into 2017 milk prices will depend a lot on the level of milk production. Milk production continues to run well above year ago levels with October production up 2.5 %. Milk cow numbers have been declining falling by 6,000 head since peaking in August. Of the 23 reporting states 11 had fewer cows than a year ago. But, more milk per cow is driving the increase in milk production. Milk per cow was 2.3% higher than a year ago. Of the 23 reporting states just 3 had lower milk cow than a year ago."

"As of now it looks like the Class III price maybe in the high $15’s at the start of 2017, in the low $16’s by the end of first quarter, in the mid-$16’s by second quarter, higher $16’s third quarter and with the $17’s as a possibility fourth quarter. The average for the year could be near $16.50, a good improvement over the expected $14.75 this year. This is more optimistic than USDA and some other forecasters are forecasting. USDA has the Class III averaging from $15.30 to $16.20. But, final milk prices will be subject to any rather small changes in milk production, sales, or exports."

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CME Class III and Class IV Milk Futures
11-21-2016 Nov Dec Jan Feb Mar Apr May June July Aug

Class III Milk
($ per cwt.)

16.76 16.98 16.37 16.26 16.26 16.32 16.33 16.50 16.64 16.79

Class IV Milk
($ per cwt.)

13.80 14.66 15.24 15.46 15.79 16.15 16.38 16.54 16.73 16.80

Historical Missouri milk prices including comparison to the USDA National All Milk Price used for MPP may be found at:http://dairy.missouri.edu/mkt/index.htm