USDA: Slow Growth Mean Drop In Milk Prices

Expected slower growth in dairy cow numbers and milk per cow means lower production estimates for milk this year and next.  That's one takeaway from the USDA's latest dairy outlook.  World Agricultural Outlook chair Seth Meyer said from a price standpoint, while there was no month-over-month change ion all price categories for this year and 2018.

"We've kind of revised down our product pricing, so cheese, butter, non-fat dry wye and of course that's going to spill over into lower milk prices."

Due primarily to weaker demand for dairy in the first half of next year. However,

"We expect that lower production of milk to catch up the second half of the year and to bring those product prices and milk prices back up a little bit for the second half. So we expect them to bottom out in the second quarter and start to rise at the moment."

Currently, USDA forecasting the milk price for 2018 at $16.20 cwt, down 85-cents from the previous month.