QUOTE AND NEWS
Wall Street Journal  Nov 25  Comment 
Milk Studios, a photography and media company, filed a lawsuit in the U.S. against Samsung, alleging trademark infringement by the South Korean technology giant’s music-streaming service and mobile application.
USDA NASS  Nov 24  Comment 
USDA NASS Michigan : 11-20-2014: October Milk Production Agriculture Report
The Times of India  Nov 24  Comment 
Country's leading milk brand Amul today announced the launch of its operations in Punjab by starting milk procurement from state farmers.
The Hindu Business Line  Nov 23  Comment 
Cooperatives step up procurement to bail out farmers
TechCrunch  Nov 21  Comment 
 The creators of coupon-code finder Honey, which helps online shoppers save at checkout, have now launched a new app called Milk (mmm…milk and honey…) that lets you save at the grocery store. The app is now one of many aimed at helping...
The Hindu Business Line  Nov 21  Comment 
Amul modifies milk pouches with National Milk Day’s logo featuring Dr Kurien
Forbes  Nov 20  Comment 
Helping your favorite aspiring designers just got a whole lot sweeter.
Clusterstock  Nov 20  Comment 
(Reuters) - Shares of Habit Restaurants Inc , a fast food restaurant chain known for its charburgers, doubled in their market debut, valuing the company at about $909.1 million. The initial public offering of 5 million Class A shares raised $90...
Agrimoney.com  Nov 20  Comment 
Prices of New Zealand dairy farms rise to their highest since the world financial crisis - defying a five-year low in dairy commodity prices




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"Milk" redirects here. For the actual futures contract on the CME please see milk futures.

In the US, dairy has a farm value of production that makes it second only to beef [1]. Despite increasing efficiency of production, domestic dairy demand has remained so high that US dairy farmers have found little incentive to export abroad. Significant export activity is limited to powdered milk and cheese to Mexico. But as seen in Chart 1, the US imports large quantities of dairy products, especially relatively expensive cheese products from the European Union.

See Beef Prices for more on US beef production and consumption, and the Dairy Products page for more on this industry.

The chart at left shows continuos front-month futures prices for Milk traded on the Chicago Mercantile Exchange.

Overview

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Chart 1. Image from the USDA.
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Chart 2. Data from the USDA.

Dairy prices are historically relatively stable. However, even small fluctuations in price can have a big effect on related companies. The USDA projects that a slight increase in the number of milk-producing cows and increasing milk production efficiency will result in a continued drop in domestic dairy prices.

The USDA forecasted the 2007 all milk price 10 cents higher than the earlier $19.05 prediction to $19.15. In 2008, the all milk price forecast is increased from $18.00 to $18.80. The minimum price of raw milk is regulated in most parts of the country by the government at $9.90, but ever since Cooperatives Working Together (CWT), a dairy farmers group, put into place initiatives in 2002 to control milk supply by retiring herds, milk price have shot up and have remained around $14.

[1]


Who wins from lower domestic dairy prices?


Who loses from lower domestic dairy prices?

  • Hain Celestial Group (HAIN) is a major producer of soy products, often seen as competing with dairy products for demand and consumption. Lower dairy prices may worsen the price difference and discourage commercial consumers from turning to slightly pricier soy alternatives.
  • AspenBio Pharma (OTC:APNB) and other companies that derive significant profit from manufacturing dairy-related bovine hormones may feel the strain of lower dairy prices through the purchasing capacity and demand of bovine farmers for more yield-increasing drugs.

The New Export Market

A growing export market may counteract the effect of domestic dairy price drops. Chinese dairy consumption is growing at an annual 15%, and many other developing countries weigh in at about 10%--comparing such numbers to the US's annual domestic consumption growth of a paltry 0.4% has led many to believe that China could be the US's next big dairy surplus export market.

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