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Dr. Tommie L. Shepherd Center for Agribusiness and Economic Development

2010 Dairy Outlook. Dr. Tommie L. Shepherd Center for Agribusiness and Economic Development. It’s Been a Heck of a Ride!. NASS Survey. Class Prices. Class I Price. Class II Price. Class III Price. Class IV Price. $. 1.1299. Make Allowance = .165. NASS Cheese Price Survey. $.

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Dr. Tommie L. Shepherd Center for Agribusiness and Economic Development

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  1. 2010 Dairy Outlook Dr. Tommie L. Shepherd Center for Agribusiness and Economic Development

  2. It’s Been a Heck of a Ride!

  3. NASS Survey Class Prices Class I Price Class II Price Class III Price Class IV Price

  4. $ 1.1299 Make Allowance = .165 NASS Cheese Price Survey

  5. $ .9649 Value of Protein in Cheese NASS Cheese Price Survey

  6. $ Yield .9649 Factor $9.35 x 9.3452 = Value of Protein on 100 lbs. of Milk

  7. The U.S. “Milk Bucket” Fluid Consumption

  8. What Were the Drivers of Milk Prices in 2009? • Milk Production (Supply) • Dairy Cow Numbers • Milk Per Cow

  9. A Very Brief History of Milk Production

  10. U.S. Cow Numbers 2005-2009

  11. Milk Per Cow 2005-2009

  12. What Were the Drivers of Milk Prices in 2009? • Milk Production (Supply) • Dairy Cow Numbers • Milk Per Cow • Milk Consumption (Demand) • Fluid Demand

  13. Fluid Milk Sales 2005-2009

  14. What Were the Drivers of Milk Prices in 2009? • Milk Production (Supply) • Dairy Cow Numbers • Milk Per Cow • Milk Consumption (Demand) • Fluid Demand • Commercial Disappearance Cheese +3.6% Butter -2.0% Milk Powder -13.0%

  15. What Will Drive Milk Prices in 2010? • The Good News • A Weaker USD Will Improve Exports • Feed Costs Will Decline • 171,000 Fewer Cows Will Decrease Production • The Bad News • Large Supply of Replacement Heifers • Recovering Production in NZ and Australia • EU Subsidies for Dairy Exports • Can’t Say For Sure • Temporary Increase in CCC Support Prices

  16. Temporary Price Support Increases Original Aug/Sep/Oct

  17. If The Markets Are Correct . . . .

  18. If The Markets Are Correct . . . .

  19. The Last Time Prices Were Near Support . . . .

  20. Watch for Falling Prices

  21. So If The Markets Are Correct . . . .

  22. We Should See Some Price Recovery

  23. A Few Trends Worth Noting The Southeast Continues to Loose Milk Production Production Increases in the Midwest and Northeast The West Has Lost Cows – But Not Necessarily Milk Production

  24. Got Questions?

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