WASDE: June report a summer repeat

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USDA’s June 11 World Ag Supply & Demand Estimates report was virtually a repeat from May, with 2014 and 2015 milk production and price estimates exhibiting little change.

• 2014 milk production and marketings were projected at 206.1 billion lbs. and 205.1 billion lbs., respectively. If realized, 2014 production and marketings would be up about 2.4% from 2013.

• 2015 production and marketings were projected at 212.1 billion lbs. and 211.1 billion lbs., respectively. If realized, 2015 production and marketings would be up about 2.9% from 2014.

Export forecasts were raised on a fat basis for 2014 and 2015 with higher cheese exports. However, growth in 2014 exports is constrained by weaker butter sales, as higher domestic prices have made U.S. butter less competitive on world markets. Skim-solids exports reflect strength in cheese and nonfat dry milk (NFDM) exports.

Imports for 2014 and 2015 are raised on higher imports of food ingredients.

Cheese and butter prices (see table) for 2014 were forecast higher on strong demand for cheese and tight supplies of butter. The NFDM price was lowered, but the whey price forecast was unchanged.

Strength in butter prices is expected to carry into early 2015 resulting in an increase in the 2015 price, but the prices of cheese, NFDM and whey are unchanged from last month.

Class III and Class IV prices for 2014 and 2015 were raised on stronger butterfat values. The all-milk price was forecast at $22.90-$23.30/cwt. for 2014 and $19.75-$20.75/cwt. for 2015.

 

Beef prices

Affecting cull cow prices, latest beef steer price projections for 2014 were unchanged from May’s estimate, in a range of $143-$149/cwt. The 2013 steer price was estimated in at $125.89/cwt. Fourth-quarter 2014 prices are anticipated to be rise after a small decline during the third quarter, and continue to increase into 2015.

Expected beef production is lowered as the pace of steer and heifer slaughter in the second quarter of 2014 is reduced. However, carcass weights are forecast slightly higher as feed prices have moderated. Forecasts for 2014 beef imports are raised as demand for processing grade beef remains strong; no change is made to the export forecast.

 

USDA dairy price forecasts 

 

 

 

 

Estimated

Estimated

Forecast

Forecast

Product   

2012

2013

2014

2015

Class III ($/cwt)

17.44

17.99

20.80-21.20

16.95-17.95

Class IV ($/cwt)

16.01

19.05

21.45-21.95

18.65-19.75

All milk ($/cwt)

18.52

20.05

22.90-23.30

19.75-20.75

Cheese ($/lb.)

1.7076

1.7683

2.015-2.055

1.670-1.770

Butter ($/lb.)

1.5943

1.5451

1.870-1.940

1.640-1.770

NFDM ($/lb.)

1.3279

1.7066

1.830-1.860

1.605-1.675

Dry whey (¢/lb.)

59.35

59.02

63.0-65.0

55.0-58.0

Source: USDA World Ag Supply & Demand

 

 

Estimates report, June 11, 2014

 

 

 

 

 

 

 

 

USDA feed price* outlook

 

 

 

 

Estimated

Estimated

Forecast

Forecast

Product

2011/12

2012/13

2013/14    

2014/15

Corn ($/bu.)

6.22

6.89

4.45-4.65

3.85-4.55

Soybeans ($/bu.)

12.5

14.4

13.10

9.75-11.75

Soy meal ($/ton)

394

468

485

355-395

*U.S. average price paid at the farm level

 

 

Source: USDA World Ag Supply & Demand

 

 

Estimates report, June 11, 2014

 

 

 

Feed situation

On the feed side of the dairy equation, USDA’s WASDE report left the outlook for 2014/15 U.S. feed grain supplies virtually unchanged from last month’s projections.

Projected corn production for 2014/15 is unchanged at a record 13.935 billion bushels. The projected U.S. corn yield remains at 165.3 bushels per acre as a slightly slower-than-normal mid-May planting progress is expected to be offset by very favorable early season crop and weather conditions.

The projected range for the 2014/15 season-average farm price for corn is unchanged, at $3.85-$4.55/bushel, below this month’s lower projected 2013/14 range of $4.45-$4.65/bushel (see table). The 2013/14 price range is lowered 10¢/bushel at the midpoint, based on prices reported to date and the recent decline in nearby cash and futures prices.

This month’s U.S. soybean supply and use projections for 2014/15 include a small reduction in beginning and ending stocks. Lower beginning stocks reflect a higher crush projection for 2013/14. Soybean crush for 2013/14 is raised 5 million bushels, to 1.700 billion, reflecting an increase in projected soybean meal exports. Soybean ending stocks for 2013/14 are projected at 125 million bushels, down 5 million from last month. Ending stocks for 2014/15 are also reduced 5 million bushels to 325 million.

The 2014/15 season-average price for soybeans is projected at $9.75-$11.75/bushel, unchanged from last month. Soybean meal prices are projected at $355-$395/ton, also unchanged from last month.



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