Missouri Dairy Business Update

Volume 16, Number 7
July 2016

Milk Prices

According to Bob Cropp's July Dairy Outlook, "The good news is milk prices bottomed out in May and are now improving. The May Class III was $12.76 with June increasing to $13.22 and July will be near $15.35. The Class IV price was $13.09 in May with June increasing to $13.77 and July will be near $15.10. Class III futures are in the $16s for the remainder of the year. Class IV futures reach $16 in September and stay there for the remainder of the year. But, it is uncertain if prices will hold at these levels."

"Whether dairy product prices increase more in the months ahead will depend on continued strong sales and lower milk production than now forecasted. It doesn't now look like we can expect much improvement in exports to increase prices."

"So there is now much uncertainty whether milk prices will end up as dairy futures is now showing. But, I do believe Class III and Class IV staying at least in the $15s for the remainder of the year is very possible."

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CME Class III and Class IV Milk Futures
7-27-2016 July Aug Sept Oct Nov Dec Jan Feb Mar Apr

Class III Milk
($ per cwt.)

$15.27 16.94 16.78 16.65 16.40 16.05 15.98 16.00 16.07 16.22

Class IV Milk
($ per cwt.)

$14.92 14.91 15.43 15.80 16.06 15.70 15.80 15.99 16.04 16.28

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