The milk production forecast for 2016 is lowered from last month as the pace of cow herd expansion has slowed. However, the production forecast for 2017 is raised as higher forecast milk prices and lower feed costs in late 2016 and early 2017 are expected to lead to higher 2017 cow numbers. Fat basis exports are lowered for 2016 as slowing sales of butterfat products more than offset higher whole milk powder (WMP) exports. The forecast for 2017 is unchanged.
On a skim-solids basis, the export forecasts for 2016 and 2017 are raised on higher WMP sales. For 2016 and 2017, imports are unchanged on a fat basis, but are raised on a skim-solids basis. Fat basis stocks are forecast higher as stocks of butter remain high, but on a skim-solids basis, stocks are reduced.
Cheese, butter, nonfat dry milk, and whey prices for 2016 and 2017 are forecast higher as demand remains robust. Class III and Class IV price forecasts are raised for both 2016 and 2017 as the component product prices forecasts are raised. The all milk prices are forecast higher at $15.55 to $15.85 per cwt for 2016 and $15.70 to $16.70 per cwt for 2017.
Click here to read the entire July 2016 WASDE report.
