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Dairy economist predicts lower prices in 2016

A dairy economist is predicting milk prices will stay steady or possibly go lower in 2016.

Mary Ledman says the record-high prices set last year have been eroding throughout 2015.

“We’re kind of working through the hangover effect of high milk prices, where producers around the world produced more product than what we really had demand for; or demand at a price that they really want to sell their product at.”

She tells Brownfield that while U.S. production has slowed, the European Union is producing about two percent more milk.

“They account for 30 percent of world production, so that’s still creating a lot of skim milk powder on the global market-which is depressing prices.”

And Ledman says she expects those lower prices to continue into next year.

“Milk price checks in the first half of 2016 will be similar or a little bit less than 2015.”

She says a slowdown in European milk production could lift prices in the second half of 2016 back into the $17 to $18 dollar range.