MONTHLY DAIRY AND MILK MARKET REVIEW |
| Wednesday, January 27, 2010 |
| Comments by: Don Guthmiller Hamlin County Extension Educator - Marketing/Management South Dakota State University P.O. Box 268, Hayti South Dakota 57241 Phone: 605-783-3656 E-Mail: Donald.Guthmiller@sdstate.edu econ.sdstate.edu |
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| COMMENTS |
With the January Production report we now have seen six months of reduced production and the number of cows has also shown a decrease from a year ago. During early January, milk prices fell but there has been a slow steady recovery in milk prices during the rest of the month. Both the Class III and the All Milk price projections were lowered for 2010. However, USDA is projecting that feed price should be lower than the last two years, which should increase milk per cow and profitability. When the USDA final crop report came out, production of corn and soybeans were higher than expected. Corn dropped 50 cents that next day and soybeans dropped 90 cents which also affected soybean meal. This is not good for grain producers but affects the feed prices for livestock producers who purchase most inputs. The USDA milk production forecast was raised due to the slower than expected cow reduction loosing 9,000 head in November and 3,000 head in December. That was compared to 176,000 head in the previous 5 month period. Since August dairy cow slaughter has dropped through November putting November’s slaughter at November 2005 levels. December 2009 levels were the largest since the December 2003 level of 244,000 head. Exports for 2009 were revised up slightly and imports were revised down. As the economy recovers, cheese prices should strengthen and exports should improve in 2010. The Milk Production Report was issued from USDA NASS on January 19, 2010.
The USDA World Ag Supply and Demand report was issued on January 12 that has All Milk price projections.
The Class III USDA Milk price projections on December 20th were $13.81 for the 1st quarter of 2010 and $14.54 for the 2nd quarter, $15.20 for the 3rd quarter, and $15.59 for the fourth quarter of 2010.
The monthly USDA NASS Dairy Products report was issued January 5, 2010.
The NASS Cold Storage report was issued January 22, 2010.
The monthly USDA Livestock Slaughter report was released January 22, 2010.
Know your production costs per hundred pounds of milk produced to be able to use forward pricing alternatives to obtain a profit on your dairy farm. If you need assistance in calculating your unit cost of production, contact your local Extension Office to set an appointment! Watch for the next South Dakota Dairy and Milk Market Update the end of February 2010. |
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Links: |
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| Dairy Marketing and Risk Management Website - Univ of Wisconsin | |
| USDA-Economic Research Service | |
| ERS - Dairy Briefing Room | |
| USDA-National Agricultural Statistics Service Publications Calendar | |
| NASS - Agricultural Charts and Graphs | |
| NASS - Cold Storage Report of Stocks-Graphics | |
| USDA Agricultural Marketing Service-Dairy Reports | |
| Chicago Mercantile Exchange Daily Dairy Report | |
| For more information: Economics Department website -- http://econ.sdstate.edu/ under the Extension tab click onCurrent Market Analysis Extension Service website ---- http://sdces.sdstate.edu/ or contact Mr Guthmiller at donald.guthmiller@sdstate.edu |