Major dairy product prices are expected to go higher in 2011. Prices were revised upward this month from February’s forecasts. Export demand for cheese and NDM boosted prices as exporters competed with domestic demand. Cheese prices are forecast to average $1.695 to $1.755 per pound for the year, and NDM prices are projected to average $1.365 to $1.415 per pound. Although seemingly high in light of reported cheese stocks, the high cheese price, along with exceptionally high December cheese exports, suggests that exports may be currently supporting the price. Extremely tight butter stocks are helping to support currently high butter prices. Later this year, continued improvement in domestic demand for cheese and butter is expected to support prices as increased milk production and lowered export prospects from rising competition work to limit prices. The butter price is expected to average $1.735 to $1.825 per pound for the year. Whey prices are forecast to average 40.0 to 43.0 cents per pound. High NDM prices may be providing some support for whey prices. The higher expected prices for the major dairy products lead to rising forecasts milk prices. Milk price forecasts will be higher this year than last, and the milk price forecast was raised in March from February projections. The Class IV price is estimated to average $16.95 to $17.65 per cwt and will average above the Class III price, which is expected to average $16.35 to $16.95 per cwt. The all milk price is forecast to average $18.10 to $18.70 per cwt in 2011.
Cow numbers continue to expand as milk prices rise