USDA Milk Production Up In October

According to the October USDA Dairy Outlook, there was another increase in milk production and supplies.  Production increased slightly month-over-month as the industry prepares for a 3% increase in 2019.  What might this mean from a price perspective for different categories and classes of milk?

"The whey and even the butter market, in the near term, are providing some product-price support," said World Agricultural Outlook Chair Seth Meyer.  "Cheese prices, we reduced cheese prices a little bit and basically, we've got large stocks of cheese overhanging the market. And so, at the end of the day, what you end up with is also mixed-class milk prices, some products up, some prices down.

So not big changes in the all-milk price either. When we talk about the dairy margin and the dairy margin protection program, there's still an expectation we'll run above $8 for the remainder of the forecast period, and still a 90-cent increase in the all-milk price year-over-year."