USDA says dairy cow numbers will continue to decline

The monthly Livestock, Dairy and Poultry Outlook from USDA predicts reduction in the dairy herd will continue well into next year although more production per cow will dampen the decline in milk production somewhat. Milk production is forecast to be 187.5 billion pounds in 2009 and 186.4 billion in 2010. Domestic demand is expected to increase 1% this year then hold steady next year at 186.1 billion pounds. Exports, which dropped dramatically from last year are expected to rebound a little in 2010.

Cheese prices are now pegged at between $1.235 and $1.275 per pound this year then increase to average between $1.58 and $1.68 in 2010. Butter is predicted to run between $1.185 and $1.255 per pound this year, $1.44 to $1.57 next year. Nonfat dry milk will range from 83.5 cents to 87.5 cents per pound this year then move to $1.00 to $1.07 in 2010. Whey is projected at 22 to 24 cents this year, 26 to 29 cents per pound next year.

As a result, Class III milk is now predicted to average $10.60 to $11.00 per hundredweight this year and jump to $14.30 to $15.30 in 2010. Class IV is expected to run between $10.10 and $10.60 this year and $12.55 to $13.65 next year. The all milk price for 2009 is projected to be $11.95 to $12.35 and climb to $15.10 to $16.10 in 2010.

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