Missouri Dairy Business Update

Volume 17, Number 10
October 2017

Milk Prices

According to Bob Cropp's October Dairy Outlook, "Higher cheese prices more than offsetting lower dry whey prices will result in an October Class III price near $16.60, up about $0.30 from $16.36 in September."

"Declining nonfat dry milk prices will lower the Class IV price. Class IV was $16.61 in August, $15.86 in September and will be near $14.90 in October. Butter started the month at $2.295 per pound and strengthened to $2.40, but has fallen back to $2.35. The price of nonfat dry milk has dropped below $0.80 per pound to $0.74, the lowest price since April 2016, more than offsetting the higher butter price."

"Unless cheese prices rally more like prices did last year the Class III price for November and December will stay in the $16’s and average about $16.25 for the year compared to $14.87 last year. Looking into 2018 Class III prices could stay in the high $15’s for the first half of the year and reaching the $16’s during the second half. The Class IV price will stay in the higher $14’s November and December, averaging about $15.40 for the year compared to $13.77 last year. The Class IV price for 2018 may stay in the $14’s for most of the year. But, milk prices can change a lot from rather small changes in milk production, domestic sales or dairy exports. So final 2018 milk prices could end up quite different."

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CME Class III and Class IV Milk Futures
10-30-2017 Oct Nov Dec Jan Feb Mar Apr May June July

Class III Milk
($ per cwt.)

16.71 16.54 16.00 15.70 15.63 15.48 15.39 15.50 15.73 15.97

Class IV Milk
($ per cwt.)

14.89 14.15 14.11 14.23 14.38 14.54 14.69 14.84 15.01 15.21

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