Milk production forecasts for both 2024 and 2025 have been revised downward due to lower cow inventories and reduced output per cow. This reduction is leading to tighter supplies across the dairy market, with significant implications for imports, exports, and pricing.
Key Points,
Milk production forecasts for 2024 and 2025 are lowered due to reduced cow inventories and output per cow.
2024 cheese, NDM, and whey prices are raised, pushing the all milk price to $22.30 per cwt, with further increases expected in 2025.
Fat-based dairy exports for 2024 are up, while skim-solids exports for 2025 are boosted by competitive U.S. NDM pricing.
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U.S. milk production is expected to decline in both 2024 and 2025 due to a reduction in cow inventories and lower output per cow. This marks a notable shift from previous projections, reflecting tighter supply conditions.
For 2024, fat-based imports are reduced, but the forecast for fat-based exports is raised, driven by stronger shipments of butter and milkfat. For 2025, imports are expected to rise on both fat and skim-solids bases, while skim-solids exports are boosted by competitive pricing for U.S. non-fat dry milk (NDM).
Price forecasts for key dairy products in 2024, including cheese, NDM, and whey, are raised due to recent market strength. However, butter prices are lowered. Both Class III and Class IV milk prices are increased for 2024, with the all milk price now projected at $22.30 per cwt. For 2025, prices for cheese, butter, NDM, and whey are further raised due to tighter supplies and continued strong demand.
The dairy market is poised for tighter supply conditions over the next two years, leading to higher prices across key products. While lower milk production constrains supply, strong export demand and competitive pricing will continue to shape market dynamics.
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The information provided in this market insight is for general informational purposes and should not be considered financial advice. It is not intended to offer any financial recommendations or endorsements. Any decisions made based on the content are the sole responsibility of the reader.
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