With USDA's release of agricultural prices this afternoon www.usda.gov/nass/PUBS/TODAYRPT/agpr0809.txt
, it appears the feed cost adjustor in the formula will go to zero. And with a Boston Class I price of $13.51 in July, that pegs the Milk Income Loss Contract payment for July at $1.54.
August preliminary numbers also suggest feed prices will reach their lowest level in two years. USDA's preliminary estimates peg corn prices at $3.31/bu, soybeans at $10.70 and alfalfa at $111/ton. This works out to a 16% dairy ration cost of $6.72/cwt of feed. A year ago, with $5.26/bu corn, $12.80/bu and $179/ton, the ration cost computed out to $10.17.
If the feed prices hold, the feed adjustor for the August MILC calculation will remain at zero. And based on an August Class I price of $13.29, the August MILC payment will be $1.64 for those who qualify. www.fsa.usda.gov/FSA/webapp