Missouri Dairy Business Update  
Volume 9, Number 12
December 2009

Milk Prices

According to Robert Cropp's Dairy Outlook, "Higher dairy product prices means much improved farm milk prices. The December Class III price will be near $14.85, up almost $4.90 from the yearly low of $9.97 for both June and July. For the year, the Class III price will average about $11.30, down about $6.15 from the $17.44 average last year. The U.S. All Milk Price will be near $16.00 for December, about $4.70 higher than the yearly low of $11.30 for both June and July. For the year the ALL Milk Price will average near $12.75, about $5.55 lower than the $18.29 average last year. With some dropping back in cheese and butter prices now that holiday orders are filled, we may not see an increase in January milk prices. But, beyond January with a continued decline in milk production from a year ago and some signs of perhaps improvement in domestic sales, especially cheese, and anticipated further improvement in dairy exports, milk prices will continue to improve in 2010. Dairy producers can anticipate a much improved year in 2010 with higher milk prices."

Futures on the Chicago Mercantile Exchange
12-29-09 Dec Jan 10 Feb Mar Apr May June July Aug Sept
Class III Milk (per cwt.)
$14.91 $14.33 $14.15 $14.59 $14.85 $15.22 $15.64 $16.05 $16.10 $16.21
Class IV Milk (per cwt.)
$15.04 $14.68 $14.84 $14.96 $14.80 $14.87 $15.08 $15.40 $14.97 $15.36
Butter (per lb.)
$1.46 $1.34 $1.41 $1.45 $1.48 $1.49 $1.52 $1.55 $1.56 $1.57
Source: CME Group

Current USDA Milk Price Forecasts
12-17-09
4th Q 2009 1st Q 2010 2nd Q 2010 3rd Q 2010
Class III Price $13.73 to $13.93 $14.39 to $14.89 $14.90 to $15.70 $15.41 to $16.41
Class IV Price $13.13 to $13.43 $14.44 to $15.04 $14.27 to $15.17 $14.76 to $15.86
Source: USDA, ERS, Livestock, Dairy & Poultry Outlook


Historical Missouri milk prices may be found at: http://agebb.missouri.edu/dairy/mkt/index.htm



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