The monthly World Agricultural Supply and Demand Estimates from USDA on Tuesday increased the milk production estimates for 2009 and 2010. The report bumped 2009 production 100,000 pounds higher to 189.3 billion pounds and increased the 2010 production estimate 500,000 pounds to 188.9 billion pounds. The changes reflect the milk production trend in fourth quarter of 2009 along with that 4.5 million head of replacement heifers in the January 1 cattle inventory.
Despite the higher production, the cheese and butter price estimates for 2010 were each raised a half-cent from last month’s report. Cheese is now projected to be between $1.575 and $1.645 per pound, butter between $1.395 and $1.495 per pound. The nonfat dry milk price was cut a dime and dry whey was reduced a penny.
Thanks to the higher cheese price, the Class III milk price was raised 5 to 15 cents and now is projected between $14.90 and $15.60 this year. The lower powder prices pushed the Class IV estimates down to between $14.90 and $15.60 leaving the all-milk estimate about where it was a month ago, $16.20 to $16.90.
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