Missouri Dairy Business Update

Volume 17, Number 3
March 2017

Milk Prices

According to Bob Cropp's March Dairy Outlook, "Milk production will increase during the spring flush and likely will push milk prices lower. We can expect the Class III price to be in the low $15’s and the Class IV price in the low $14’s for the months of April and May. But, with continued favorable butter and cheese sales along with continued improvement of dairy exports milk prices should trend back upward after that. The Class III price could be back to the $16’s by June and reaching into the high $17’s by fourth quarter. The Class IV price could reach the $15’s by June and the higher $15’s by fourth quarter."

"As we move ahead we will get a better sense of how domestic sales, milk production and exports will turn out in 2017. Any change in these factors could result in quite different milk prices. USDA is forecasting a 2.4% increase in milk production for 2017 from 52,000 more cows, an increase of 0.6% and 410 more pounds of milk per cow, an increase of 1.8%. This is a lot of milk. Good domestic sales and continued improved exports will be necessary to reach the high $17’s for Class III and high $15’s for Class IV."

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CME Class III and Class IV Milk Futures
3-21-2017 Mar Apr May June July Aug Sept Oct Nov Dec

Class III Milk
($ per cwt.)

15.76 15.46 15.73 16.01 16.50 16.68 16.79 16.56 16.40 16.31

Class IV Milk
($ per cwt.)

14.41 14.10 14.28 14.54 14.89 15.18 15.43 15.62 15.69 15.71

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