WASDE report projects higher dairy exports next year
USDA forecast the 2011 all-milk price at $15.90/cwt. to $16.70/cwt. in its World Agricultural Supply and Demand Estimates (WASDE) released today.
The WASDE report also said milk production for 2010 and 2011 is little changed from last month’s estimates.
USDA lowered 2010 fat-basis imports lowered primarily due to lower imports of cheese but left skim-solids imports unchanged due to higher imports of expected imports of other products.
USDA raised fat-basis exports for 2010, saying “sales of cheese and fluid milk and cream are strong.” Skim-solids exports are boosted by strong sales of cheese and nonfat dry milk (NDM).
Exports for 2011 are forecast higher due to expected growth in butter and nonfat dry milk sales. USDA increased 2010 ending stock figures to reflect higher-than-expected stocks of cheese.
For 2010, cheese and whey prices are unchanged from last month. NDM prices are forecast higher but the butter price forecast is reduced reflecting recent sharp declines in butter prices. With no change in either the cheese or whey price, the Class III price forecast is unchanged.
However, the Class IV price forecast is reduced, due to a lower butter price forecast which more than offsets a higher expected NDM price.
For 2011, the range of the cheese price forecast narrowed but whey is forecast higher. The butter price is reduced as current price weakness spills into early 2011. NDM prices are forecast higher. The ranges of the Class III and Class IV price forecasts are narrowed from last month.
The all-milk price is forecast to average $16.25/cwt. to $16.35/cwt. for 2010.
