QUOTE AND NEWS
Agrimoney.com  36 min ago  Comment 
Firmer production and cattle numbers reveal New Zealand milk production will not fall as much in 2017 as expected
DailyFinance  4 hrs ago  Comment 
Filed under: News, Crime A 28-year-old man stabbed and dismembered his parents, then dissolved some of their body parts in acid to hide their remains, authorities said. Joel Michael Guy Jr. was arrested at his Louisiana apartment by FBI...
NPR  6 hrs ago  Comment 
Subsidized greasy-spoon diners called milk bars thrived in Poland in the communist era. Their numbers have dwindled, but Poles are once again embracing them for cheap comfort food.
DailyFinance  6 hrs ago  Comment 
Filed under: Lifestyle, Recipes I know, I know... how can dulce de leche be skinny? Well, that's pretty simple actually, you make it using a reduced fat sweetened condensed milk. Tada! Really dulce de leche is similar to a caramel, though...
Bulk Transporter  Nov 30  Comment 
The Tremcar side man-hole milk tanker, built to answer Agri mark’s security issues for its haulers and operators was approved for use in four Northeastern states after an inspection at the milk processor’s West Springfield MA plant....
The Economic Times  Nov 30  Comment 
Terming UP as a big market, Akhilesh said if anyone wanted to invest in vegetables and milk production, they would get big market in the state itself which they would not get in the entire country.
The Hindu Business Line  Nov 30  Comment 
The Food Safety and Standards Authority of India (FSSAI) has operationalised standards for camel milk. This was done after several discussions held by FSSAI’s task force on milk and milk products at...
DailyFinance  Nov 30  Comment 
Filed under: News, Controversy Last year, the school lunch program championed by First Lady Michelle Obama was criticized by many students online. Teens began to share photos of their unappetizing lunches with the hashtag...
Wall Street Journal  Nov 29  Comment 
German convent long survived by selling milk and candles and collecting interest on bank deposits. When Europe’s central bank began cutting rates, it needed another strategy
The Economic Times  Nov 29  Comment 
"The way Indian households works and the retail chain works they always have some stock at the household."




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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

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