Could Milk Prices Rebound in 2016?

February 16, 2016 02:30 PM
 
Milk glass splash

As dairy producers know better than anyone, milk prices in the U.S. continue to feel downward pressure. What’s causing it? Analysts say global supplies are to blame, helping to push prices lower.

“As we look at the stage that’s being set for the year ahead, we have a lot of stocks to chew through,” said Mike North of Commodity Risk Management Group on AgDay. “We filled a lot of cracks last year trying to make up for China’s loss of imports, and as we’ve worked our way forward we need to find a new home for all this new product. The pressure that’s putting on milk prices is pretty significant.”

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He says prices could continue to decline in the near term. He wouldn’t be surprised to see a Class II milk price in the $12 to $13 range. Informa Economics analysts agree, but add that milk prices could turn around in 2016. They expect global prices to improve and suggest U.S. dairy products could become more competitive in the coming months leading to a price turn around.

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Comments

 
Spell Check

Dairy&Crops
Walpole, NH
2/19/2016 10:29 AM
 

  How much do these guys really know? Last year at this time they were predicting a price turnaround in third quarter 2015. We are still in a decline.

 
 
Milkman
Clovis, NM
2/16/2016 11:28 PM
 

  This guy is a moron if milk goes to $12 or $13 it will be a bloodbath but a short one I guarantee it banks haven't forgot about 2009 yet sorry mike north... I would like to know what this guy was predicting going into 2014 I bet the farm he was wrong

 
 
Dustin
Cassville, MO
2/19/2016 03:26 PM
 

  This is all about that MPP insurance, big co-ops are still mad that they didn't get production control and only about half of all producers bought last year and most of those reduced coverage this year. I'd love to see every dairy farmer dump half their milk for two weeks. Talk about co-ops scrambling to fill contracts, it would allow farmers to take back some power and get things in place for us instead of the suits. How many suits are paid based on the markets, or how about the haulers, maybe even those running the unloading hubs? None right, they get theirs even when we are forced to choose, feed the kids or feed the cows.

 
 

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