The USDA’s Economic Research Service (ERS) is projecting first-quarter 2012 All-Milk prices to decline to the $18.50 to $18.90/cwt. range, down from $20.03 in the fourth quarter of 2011.
For the year, ERS expects the All-Milk price to average from $18.30 to $19.10/cwt. The midpoint of that range would be a $1.44 drop from 2011, or a 7% decline. The Class III price is expected to be in the $16.90 to $17.30/cwt. range in the first quarter of 2012, and the year’s average to be in the $17.10 to $17.90/cwt. range.
As a result of the lower prices, cow numbers are expected to decline 9.160 million head by the fourth quarter of 2012, or 30,000 fewer head than in the fourth quarter of 2011.