Milk Prices
According to Bob Cropp's Dairy Outlook, "Increases in milk production will likely continue at a slower rate through last quarter of this year
and for 2009. Lower milk prices and high feed costs this fall and winter are likely to reduce the
average total number of milk cows in 2009. Weekly dairy cow slaughter has been running higher
than a year ago. While dairy cow slaughter through the week ending July 26th was just 2.6%
higher than a year ago, in recent weeks dairy cow slaughter has been up as much as 18%. Also
CWT will be removing cows this fall. While 2008 milk production will total about 2% more than
2007, milk production may increase only 1% or less in 2009. This slower growth in milk
production will add strength to milk prices. But this will be partially offset by also a slower
growth in domestic as well as international sales of milk and dairy products. Slower growth in
the economy along with higher food, gas and home heating prices this winter will dampen
domestic sales. Some strengthening of the U.S. dollar and increased milk production in New
Zealand and Europe as well as a slower growth in the world economy may slow the growth in
dairy exports. Nevertheless, while milk prices are likely to average lower in 2009 than 2008, the
base milk price is still likely to average above $17.00."
Milk Futures on the Chicago Mercantile Exchange |
8-27-08 |
Aug |
Sept |
Oct |
Nov |
Dec |
Jan 09 |
Feb |
Mar |
Apr |
May |
Class
III |
$17.20 |
$15.98 |
$16.34 |
$16.65 |
$16.84 |
$16.70 |
$16.81 |
$16.95 |
$17.15 |
$17.18 |
Class
IV |
$17.10 |
$16.55 |
$16.90 |
$16.35 |
$16.00 |
$16.00 |
$16.00 |
$16.00 |
$16.00 |
$16.00 |
Butter
Futures |
$1.57 |
$1.59 |
$1.60 |
$1.59 |
$1.57 |
$1.56 |
$1.55 |
$1.56 |
$1.57 |
$1.58 |
Current
USDA Milk Price Forecasts |
8-19-08 |
3rd Q 2008 |
4th Q 2008 |
1st Q 2009 |
2nd Q 2009 |
Class
III Price |
$17.53 to $17.83 |
$17.29 to $17.89 |
$16.96 to $17.86 |
$17.17 to $18.17 |
Class IV Price |
$16.67 to $17.07 |
$16.85 to $17.55 |
$16.38 to $17.38 |
$15.62 to $16.72 |
Source:
USDA,
ERS, Livestock, Dairy & Poultry Outlook |
Historical Missouri milk prices may be found at: http://agebb.missouri.edu/dairy/mkt/index.htm
Hedging Opportunity Chart for next 12 Months http://www.uwex.edu/ces/milkmarketing/ |