The monthly World Agricultural Supply and Demand Estimates from USDA did not contain good news for dairy. Citing lower feed costs, slowed herd reduction, larger-than-expected January cow numbers and decreased exports …the Ag Department Outlook Board increased the 2010 milk production estimate from 188.9 billion pounds last month to 189.5 billion pounds this month. That would put 2010 production slightly higher than the 189.3 billion pounds of 2009.
As a result, price estimates have been lowered from last month; cheese estimates 7.5 cents lower now expected to range between $1.50 and $1.56 per pound. Butter is 1 to 2 cents lower at $1.415 to $1.505 per pound. The dry whey price is a penny lower and nonfat dry milk 4 to 5 cents below last month’s projections. This all means lower milk prices; Class III is down 70 to 80 cents from last month now expected to average between $14.20 and $14.80 this year. Class IV is 30 to 40 cents lower priced between $13.65 and $14.35 and the all milk price is now $15.55 to $16.15 representing a 65 to 75-cent drop from last month.
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