Due to recent declines in milk cow numbers, relatively high slaughter levels, and higher expected feed prices, milk production forecasts have been lowered for 2019 and 2020. Dairy exports were relatively weak in April, and export forecasts have been lowered for both 2019 and 2020. Dairy exports are expected to grow 3.3 percent next year as global demand for dairy products grows.
The all-milk price forecast for 2019 is $18.00 per cwt, 5 cents lower than last month’s forecast. The all-milk price forecast for 2020 is $18.90 per cwt, 10 cents higher than last month’s forecast.
From the week ending May 4 to the week ending June 8, price directions for domestic wholesale dairy product prices reported in the USDA National Dairy Products Sales Report were mixed. The largest change was for butter, which rose by 10.0 cents to $2.3488 per pound. While the price for 40-pound blocks of cheddar cheese rose to $1.7094 per pound, the price for 500-pound barrels (adjusted to 38 percent moisture) declined slightly to $1.6227 per pound. The price for nonfat dry milk (NDM) rose to $1.0377 per pound, and the price for dry whey fell to $0.3667 per pound.
For the trading week ending June 7, the average butter price on the Chicago Mercantile Exchange (CME) was $2.3745 per pound. The CME cheddar cheese block-barrel spread for the trading week ending June 7 was relatively wide, with average prices for 40-pound blocks and 500-pound barrels of $1.7330 and $1.5110 per pound, respectively.
USDA, National Agricultural Statistics Service (NASS) estimated that U.S. milk production was 18.430 billion pounds in April, up 0.1 percent from April 2018. NASS reported a revised estimate of 18,873 for March, down -0.6 percent from March 2018. Milk cows in April numbered 9.328 million head, down 1,000 head from a revised estimate of 9.329 million head in March. Milk per cow averaged 65.9 pounds per day in April, 1.1 percent higher than April 2018. Dairy cow slaughter has remained above previous-year levels in recent weeks.