Milk Production and Prices Looking Skim
The milk production outlook for the next couple years isn’t as full-fat as anticipated.
The USDA skimmed down its 2021 and 2022 milk production forecasts slightly in its August World Ag Supply and Demand Estimates (WASDE) report. Lower cow numbers, larger supplies, and weakening demand were behind the reduction.
The 2021 milk production forecast lands at 228.1 billion pounds, mooving down 100 million pounds from last month’s estimate.
The glass half-full: But, milk production would be up about 2.2% from 2020.
School, football games, and holiday preparation didn’t milk the normal seasonal price increases this year, which has led to the lower price estimate.
Soured cheese, butter, nonfat dry milk (NDM), and whey price forecasts caused the projected 2021 Class III and Class IV milk prices to be lowered to $16.55 and $15.15 per hundredweight (cwt), respectively. The all-milk price forecast is down 29 cents from the 2020 average: $18.24 per cwt.
Crystal ball: The USDA looked ahead to 2022 and is forecasting milk production at 231.2 billion pounds. That’s down 400 million pounds from last month’s estimate. But on the bright side, 2022 production would be up about 1.4% from the 2021 forecast if it comes to fruition.