This month’s Dairy Market Report from the National Milk Producers Federation (NMPF) shows that developments made during the first part of April brought slight improvements
in the outlook for milk prices, but also highlighted several indications that milk production will be coming off its near flat growth pattern of the past several months, which may cast a shadow over the outlook going forward.
Exports of all products were up from 12.2% of total U.S. milk solids production a year ago to 12.5% this period. AMF exports were up by 62% during the period, providing a notable exception to the recent trends for lower milk fat exports and increased milkfat imports.
Restrained growth of U.S. milk production has been an important factor in maintaining a tighter supply-demand balance in the U.S. domestic market relative to the depressed world dairy markets. During December 2015 – February 2016, U.S. milk production was up by just 0.6% over a year ago. Cow numbers remained essentially flat. Leap year-adjusted production was up by 1% in February, on a similar increase in production per cow, with very little change in overall cow numbers. According to the USDA’s decision tool for the milk Margin Protection Program (MPP), the program could make small top-end payments each of the next three bimonthly periods, March–April through July–August this year.
This month’s full report can be viewed here