November 4

11/4 – Class III milk futures at $20.19/cwt are up 46.2% since the beginning of 2019 and are currently 35.7% above year-ago levels. High slaughter rates have pushed the milk cow herd at its lowest level since early 2016. Global milk production is lackluster, with demand for dairy products exceeding available supplies and pushing prices higher in most parts of the world. The USDA is projecting U.S. cow herd numbers to be down 0.8% in 2019, milk per cow up 1.0% and milk production up just 0.2% for the year. So far, USDA is projecting 2019 class III milk to average $16.45/cwt, up 13.5% from 2018. We’re thinking the USDA estimates dairy projections to be low across the board. Market Vision is looking for 2019 class III to average $16.85/cwt (+15.3%); 2019 block cheddar at $1.78/lb (+15.7%); and 2019 butter at $2.26/lb (unchanged from 2018).