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TechCrunch  Jan 19  Comment 
 Slowly but surely, huge entertainment companies are throwing major resources into virtual reality plays. Fox took part in Within‘s $12.5 million Series A in June, and now the group’s newly formed “immersive, next generation...
The Economic Times  Jan 19  Comment 
Amongst all the segments, milk will see a reasonable growth but we are expecting the ice-cream, curd and cattle feed business to grow in double-digit plus.
The Economic Times  Jan 19  Comment 
First movers among the Indian dairy players such as Amul and Parag Milk Products have reported impressive sales by launching `desi' flavoured cheese products.
DailyFinance  Jan 18  Comment 
Filed under: Lifestyle, Healthy By: Emily Drooby, Buzz60 Everyone wants their kids to eat healthy, but life can be hectic and sometimes a fast-food meal is necessary. Go ahead and grab some fast food once in awhile, but just make sure to...
Agrimoney.com  Jan 17  Comment 
Values of whole milk powder fall for the third auction in a row - but not by as much as prices of skimmed milk powder
Agrimoney.com  Jan 17  Comment 
... at a time when New Zealand and EU output is weak too, says NAB, noting that Australia's spring flush in production has already passed
The Economic Times  Jan 17  Comment 
This is the first round of funding raised by the company after it mopped up about Rs 80 crore from Eight Roads and Aavishkaar in June 2014.
DailyFinance  Jan 16  Comment 
Filed under: Finance, Consumer News By Sean Dowling, Buzz60 If you've bought milk within the last 14 years in one of 15 states or D.C., you may be eligible for a cash payout of up to $70! It's all thanks to a class action lawsuit against...




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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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