The US All Milk Price will average around $20 per cwt. in 2011, which was welcome relief for dairy producers recovering from a brutal 2009 where the US All Milk Price averaged less than $13 per cwt and a 2010 market where prices averaged a little over $16. Prices have been supported in 2011 by strong component prices as cheese, dry whey, butter, and non-fat dry milk prices have all improved from 2010 levels.
As is typical, strong farm level milk prices led to increases in production in the second half of 2011. Mid-year dairy heifer development numbers suggest that expansion of the US dairy herd is ongoing. As this expansion continues, larger dairy cow inventory and generally increasing milk per cow should result in continued increasing production levels for 2012. As production increases, greater supply is likely to put downward pressure on farm-level milk prices in 2012. USDA is currently projecting farm level milk prices to decrease by $1-$2 per cwt.
The expansion taking place at the national level is not being seen in Kentucky. According to USDA's January estimates, Kentucky began the year with 77 thousand dairy cows, down from 80 thousand in January of 2010. The year 2010 marked the 10th straight year that Kentucky dairy cow numbers have declined. Milk cow replacement numbers were also down in January, suggesting that Kentucky is likely to see another decrease in dairy cow inventory to start 2012. (Kenny Burdine)
No comments:
Post a Comment