QUOTE AND NEWS
The Hindu Business Line  May 25  Comment 
The ₹4,000-crore Hatsun Agro Product Ltd, India’s largest private sector dairy company, has clarified that its products including Arokya, branded liquid milk, meet the highest quality standards.At a p...
The Economic Times  May 25  Comment 
Currently, sugar attracts specific central excise duty of Rs 71 per quintal plus a cess of Rs 124, which translates into ad valorem rate of more than 6%.
SeekingAlpha  May 22  Comment 
guardian.co.uk  May 22  Comment 
ParkingEye has fined me £70 when I wasn’t even there. But I can’t prove it Please help me prove my innocence over two separate visits to a supermarket on the same day, as I have been fined for overstaying. I drove to my local Aldi store...
Wall Street Journal  May 20  Comment 
U.S. dairy farmers made a big bet on strengthening global demand for their milk, but it hasn’t panned out due to economic troubles in some emerging economies and a world-wide boom in agricultural output.
USDA NASS  May 19  Comment 
April Milk Production up 2.0 Percent. Milk production in the 23 major States during April totaled 17.2 billion pounds, up 2.0 percent from April 2016...
DailyFinance  May 19  Comment 
Filed under: News, World News, Tragedy A 7-month-old baby in Belgium tragically died as a result of the strict diet his parents fed him, which exclusively consisted of gluten-free and lactose-free foods, as well as quinoa milk. Read...
The Hindu Business Line  May 18  Comment 
Foodgrains, cereals and milk will cost less from July 1 when the Goods and Services Tax (GST) is rolled out as the GST Council today decided to exempt these daily-use commodities from the levy.
The Economic Times  May 17  Comment 
Parag Dairy always try to come up with something that it can produce as a differentiated product, said Bharat Kedia.
The Economic Times  May 17  Comment 
Amul and Parag Milk Foods are among the frontrunners in launching nutritional and fruit-based milk beverages, an area where global aerated drink giants PepsiCo and CocaCola also made their entry.




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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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