TechCrunch  Sep 29  Comment 
 Here Be Dragons is a term for describing dangerous or unexplored areas. It’s also the name of Chris Milk’s new VR creative studio that’s looking to explore the dangerous world of spherical video. The VR production studio is aiming to...
Japan Today  Sep 28  Comment 
The Ministry of Agriculture, Forestry and Fisheries has announced a plan to increase butter imports by 4,000 tons in preparation for the Christmas and Valentine seasons. The ministry implemented a similar policy last year as milk production...
New York Times  Sep 26  Comment 
A different, hotter pasteurization process helps explain why organic milk has a longer shelf life than the other stuff.
NPR  Sep 26  Comment 
Greg Kelly wanted out of corporate America for a lifestyle better suited to raising a family. So he and his wife launched Alabama's only sheep dairy. "We feel like we're really living now," she says.
newratings.com  Sep 24  Comment 
WASHINGTON (dpa-AFX) - Public health officials in Colorado are warning consumers not to consume raw milk and raw milk products from Larga Vista Ranch in Pueblo County as it may pose severe health risks like Campylobacter infections. Since August...
guardian.co.uk  Sep 24  Comment 
A Senegal dairy company has started collecting fresh milk from local herders, helping to end a reliance on imported milk powder and boosting local incomes The rising sun glints off a silver and jade ring on a rangy hand. It belongs to Abu Sow, a...
The Economic Times  Sep 22  Comment 
Prabhat Dairy was the best performing stock on Wednesday, up 20%. Umang surged 19% and Kwality rose almost 8%. Parag Milk Foods edged 0.2% higher.
Agrimoney.com  Sep 21  Comment 
The New Zealand dairy giant notes slowing world supply, as producers respond to prolonged low prices
newratings.com  Sep 21  Comment 
CANBERA (dpa-AFX) - The New Zealand dollar weakened against the other major currencies in the Asian session on Wednesday, after dairy product prices rose less than expected in the latest GlobalDairyTrade auction. In the latest GlobalDairyTrade...
Agrimoney.com  Sep 20  Comment 
Falling whole milk powder prices dash hopes of a sustained dairy market rally, as South East Asian buying dries up


"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.


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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.


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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