QUOTE AND NEWS
guardian.co.uk  Sep 19  Comment 
Department for Environment, Food and Rural Affairs figures show 3.3% monthly rise but milk price remains 13% down on year earlier Beleaguered dairy farmers in Britain are enjoying an increase in the price they receive for milk after suffering...
The Economic Times  Sep 19  Comment 
"Milk industry in particular has great advantage from this move, so we expect a growth of around 30-35% depending on different geographies."
New York Times  Sep 15  Comment 
The Turbo is equally at home grabbing a gallon of milk or on the track, where the S coupe model goes from rest to 60 miles an hour in 2.8 seconds.
The Hindu Business Line  Sep 15  Comment 
The Tamil Nadu unit of the Congress today extended support to a day-long bandh called by farmers and traders’ associations tomorrow on the Cauvery water row. Vegetable and milk vendors will also join...
TechCrunch  Sep 13  Comment 
 Entrepreneurs building tech products for women spoke at TechCrunch Disrupt SF today, and called on their peers in the industry to set a high ethical bar when it comes to using or sharing women’s intimate data. Janica Alvarez’s startup Naya...
Yahoo  Sep 13  Comment 
Milk, the kind from cows, is still Americans’ favorite complement to a peanut-butter-and-jelly sandwich. But it’s feeling the heat from milk, the kind from almonds.
The Hindu Business Line  Sep 11  Comment 
Plans play from cattle genetics to feed/milk procurement
newratings.com  Sep 7  Comment 
CANBERA (dpa-AFX) - The New Zealand dollar strengthened against most major currencies in the Asian session on Wednesday, after the dairy prices climbed at the Global Dairy Trade auction. In the latest GlobalDairyTrade auction held by...
Agrimoney.com  Sep 6  Comment 
Tighter supply and renewed Chinese fuel further rises on the GlobalDairyTrade auction




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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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