It may be one of the fastest rallies in the history of tracking the milk market. We're talking about the price of Class III milk from April to June.
In April with issues with the supply chain and a sharp drop in price, many dairy farmers were forced to dump milk. The price dipping to as low as $10.39 per cwt. That's a more than 40% drop from late January.
But earlier this month, July futures were trading at $19.60 per cwt. thanks to food service demand picking back up. That's a more than 50% price move since late April.
Now, milk production and the all milk price are forecasted to be higher for 2020. USDA releasing new estimates in its latest World Agriculture Supply and Demand report.
It says milk production for the year is being raised from last month on higher expected cow numbers. USDA saying that the price forecasts for cheese, butter and nonfat dry milk are all raised from last month due to the recent price strength and stronger anticipated demand.
The all milk price forecast is now at $16.65 per cwt. for the year. And the price for next year is raised to $16.20 per cwt.