The current World Agricultural Supply and Demand Estimates (WASDE) were released today.
The 2017 milk production forecast is raised as milk cow numbers are expected to increase more rapidly. However, growth in milk per cow is reduced on January data. Dairy exports on a fat basis for 2017 are unchanged, while skim-solids basis exports are lowered on expected strong competition in international skim milk powder markets.
Both fat basis and skim-solids basis imports forecasts are unchanged. Skim-solids basis ending stocks are forecast higher for 2017 on higher production of dairy products and weaker exports.
Fat-basis ending stocks are unchanged. Historical milk production and stock estimates reflect recently released revisions. The cheese price forecast for 2017 is reduced as stocks of cheese are high and are expected to pressure prices. The butter price forecast is raised on continued demand strength. The nonfat dry milk price is forecast lower on expectations of slower export growth due to increased competition from global competitors. The whey price forecast is raised reflecting recent market strength.
The Class III price is raised as the higher whey price more than outweighs the reduced cheese price. The Class IV price forecast is lowered, reflecting a weaker nonfat dry milk price which more than offsets a higher forecast butter price.
The all milk price for 2017 is forecast at $17.80 to $18.40 per cwt.