USDA Raises Forecasts for 2010 Milk Production, Dairy Exports

June 10, 2010 01:00 PM

In its World Agricultural Supply and Demand Estimates today, USDA raised its forecast slightly for 2010 U.S. milk production from last month, reflecting a slower decline in cow numbers and stronger expected growth in milk per cow.


USDA pegged the nation's 2010 milk production at 190.4 billion pounds. Its estimate for 2011 U.S. milk production was unchanged at 193.0 billion pounds.


Export estimates for 2010 and 2011 rose on both a fat and skim solids basis. Product exports were higher than expected in the first quarter of 2010. With generally tight world supplies, U.S. exports are expected to remain strong into 2011, USDA said.


USDA also lowered dairy import forecasts for 2010 and 2011. "Imports are reduced largely because of smaller-than-expected cheese imports in the first-quarter 2010 and expectations that imports will remain weak into 2011 due to relatively low U.S. prices and tight world supplies,” said USDA.


The Class III price forecast for 2010 was reduced slightly to $13.95/cwt. to $14.35/cwt. on lower cheese and whey price forecasts. Cheese stocks remain high and international whey prices are weaker.


USDA raised its 2010 Class IV price forecast on higher butter and nonfat dry milk (NDM) price forecasts.


The all-milk price for 2010 is projected to average $15.75/cwt. to $16.15/cwt. The 2011 forecasts for Class III and IV prices and the all-milk price also climbed higher.


Improving domestic and export demand is expected to support NDM prices, USDA said. Its cheese price forecast rose as higher butter/powder values are expected to divert milk from cheese production.


Coupled with higher forecast exports and lower imports, tighter supplies are expected to support prices. USDA raised its 2011 all-milk price to $15.80.cwt. to $16.80/cwt.


The World Agricultural Supply and Demand Estimates report provides USDA's comprehensive forecasts of supply and demand for major U.S. and global crops and U.S. livestock. USDA will release its next WASDE report July 9.


Catherine Merlo is Western editor for Dairy Today. You can reach her at

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