The USDA has reduced its forecast for 2016 milk production 0.6b pounds and is now projecting 2016 production of 211.8b pounds.
Cow numbers are lowered due to lower expected milk prices and the recent storm in Texas and New Mexico, says the USDA. Estimates are that 30,000 cows were lost in the storm. Some estimates stretch as far as 40,000 cows.
Estimates for exports are lowered from the December forecast as global supplies of dairy products remain large and demand remains weak. The USDA says continued strength in domestic butter use will also limit the competitiveness of US butter in world markets. US butter prices remain around US$1000/t to US$1500/t above butter prices elsewhere.
Forecasts for 2016 imports are raised, largely on higher cheese imports. US cheese has been losing value, making it less competitive.
Dairy product prices for 2015 have been adjusted for December data. 2016 butter prices have been raised from last month on relatively strong demand and lower expected production. The estimate for butter is now at US$4167/t to US$4409/t.
For cheese, non-fat dry milk (NFDM), and whey prices are reduced from the December estimate for 2016. High cheese stocks and weaker prices at the start of the year have resulted in the reduced forecast for cheese. NFDM and whey prices are pressured by weak exports.
USDA has lowered the 2016 all milk price from US$15.95-$16.75/cwt to US$15.35-$16.75/cwt. It estimates the 2015 all milk price at US$17.08/cwt.
