USDA Leaves 2020 All Milk Price Forecast Unchanged
In its November World Agriculture Supply Demand Estimates (WASDE) report, USDA raised milk production forecasts for 2019 and 2020, but left the 2020 all-milk price forecast unchanged.
“The milk production forecasts for 2019 and 2020 are raised from the previous month as stronger growth in milk per cow more than offsets a slower expected recovery in the cow inventory,” USDA notes.
USDA lowered the fat basis export forecast for 2020, as higher domestic cheese prices are expected to affect the competitiveness of U.S. cheese in international markets. The 2020 forecast for skim-solids imports is unchanged.
“The 2020 forecast is unchanged as weak exports of cheese and whey products offset higher expected NDM/SMP sales,” USDA says. “Cheese and nonfat dry milk (NDM) price forecasts for both 2019 and 2020 are raised from last month on strength in demand. For both 2019 and 2020, butter and whey prices are lowered on current price weakness which is expected to carry into 2020.”
In this month’s report, USDA raised 2019 Class III and Class IV price forecasts. However, the 2020 Class IV price forecast is lowered. Still, USDA left the 2020 all milk price forecast unchanged at $18.85 per cwt.