USDA decreases milk production forecasts and bumps up milk prices
In their March World Agriculture Supply and Demand Estimates report, USDA decreased milk production forecasts and bumped up milk prices.
USDA cites the reduction in the national dairy herd as the justification for the lowered milk production forecast.
As far as exports go, the fat basis export forecast is lowered on reduced sales of butterfat due to global competition. Export of skim-solids based products are lowered on the anticipation of strong competition in skim milk powder and reduced demand for whey products.
USDA pushed product price forecasts higher for cheese, butter, and nonfat dry milk, but whey prices are slightly reduced.
The agency’s Class III price forecast is raised as the higher cheese price projection more than offsets the lower whey price. USDA pushed Class IV price projections on higher forecast butter and NDM prices.
The all milk price forecast is raised to average $17.00 to $17.60 per cwt.