News

Milk production estimate raised

The latest World Agricultural Supply and Demand Estimates raised the 2014 milk production projections as strong prices are expected to encourage farmers to add more cows and push them for more production per cow. Total milk production is now projected to be 206.1 billion pounds this year, up 400 million from last month’s estimate. If realized it would be nearly 5 billion pounds above last year’s production.

Thanks to that continued strong demand, the cheese price estimate was raised 11.5 to 12.5 cents pegged at between $1.985 and $2.035 per pound this year. The butter price is expected to run between $1.76 and $1.84 this year, a 14.5 to 15.5 cent increase over last month’s estimate. Dry whey increased 3.5 cents to 61.5 to 64.5 cents per pound while the nonfat dry milk price range narrowed a bit, now expected to be between $1.83 and $1.87 per pound this year.

The higher product prices translate into higher milk price projections, Class III is now estimated to range between $20.40 and $20.90 this year, up 35 to 45 cents from last month’s estimate. Class IV was raised 60 to 70 cents projected at $21.05 to $21.65 and the all milk price is pegged at $22.55 to $23.05 up $1.05 to $1.15 compared to the March estimates.

Cash cheese prices continued to decline on the Chicago Mercantile Exchange on Wednesday. Barrels slipped 7.5 cents and blocks declined 7.75 cents per pound. Since last Thursday, barrels have lost 15.5 cents and blocks have dropped 23.5 cents per pound. Dairy Market News describes the cheese market as weak: Easter and Passover needs are filled so buyers have backed-off a bit, waiting to see how far prices will decline.

National Dairy Products Sales Report for the week ending April 5: cheddar cheese blocks increased 5.4 cents to average $2.40 per pound. Barrels increased 3.7 cents to $2.36. Butter was up 7.2 cents from the previous week at $1.97, nonfat dry milk slipped 2.1 cents to $2.05 and dry whey increased 0.4 cents to 67.1 cents per pound.

Read the full WASDE report here: