Happy June Dairy Month consumers but know that it is not a happy month for dairy farmers. The Agriculture Department announced the May Federal order class III benchmark milk price at $16.11 per hundredweight (cwt.), down $2.41 from April, due to sharply lower cheese and dry whey prices, $9.10 below May 2022, and is the lowest Class III price since August 2021.
The five-month class III average stands at $17.99, down from $22.67 at this time a year ago, but compares to $16.94 in 2021. Bottom line is, very few if any, dairy farmers can make milk at current prices.Late Friday morning class III futures portend a June price at $15.33, July at $16.17 and August at $17.02 with a peak at $18.68 in November.The May class IV milk price is $18.10, up 15 cents from April, but $6.89 below a year ago. Its five-month average is at $18.66, down from $24.44 a year ago and compares to $14.54 in 2021.
StoneX dairy broker Dave Kurzawski called the situation “ugly” in the June 5 Dairy Radio Now broadcast. Farmers have told him that it feels like 2009, when milk prices plummeted and he admitted “I don’t have a great response to this.”Typically lows are put in, in May or June, he explained, so it’s a seasonal norm. “The good news is that we are seeing a number of buyers step in to buy loads of cheese at the CME and they are getting a fantastic deal.”That’s good for them, but the lower prices are attracting more export interest in third quarter, he said.
The USDA also solicited bids to purchase 47 million pounds of cheese through June 5 and will award them June 14. He believes that purchase will all be made before Christmas and result in more price stabilization.Corn and alfalfa hay prices climbed higher in April, according to the USDA’s latest Ag Prices report and the all milk price dropped some more. The milk feed ratio fell to 1.48, down from 1.56 in February, lowest since July 2012’s 1.33, and compares to 1.95 in April 2022. The all-time low was 1.02 in August 1974.
The all milk price average fell for the sixth consecutive month, falling to $20.70 per cwt., down 40 cents from March and $6.30 below April 2022.California’s All Milk price averaged $20.70, down 50 cents from March and $5.60 below a year ago. Wisconsin’s, at $20.40, was up a dime from March and $6.70 below a year ago.The national corn price averaged $6.70 per bushel, up three cents from March, after dropping 13 cents the month before, but is 37 cents per bushel below April 2022.Soybeans were unchanged from March, at $14.90 per bushel, after dropping 20 cents the previous month, but are 90 cents per bushel above a year ago.Alfalfa hay soared to an average $287.00 per ton, up $20 per ton from March and $30 per ton above a year ago.The April cull price for beef and dairy combined continued climbing, averaging $99.30 per cwt., up $3.60 from March, after gaining $6.20 the month before, is $11.20 above April 2022 and $27.70 above the 2011 base average.Income over feed costs in April were below the $8 per cwt.
level needed for steady to increasing milk production for the third month in a row, according to dairy economist Bill Brooks, of Stoneheart Consulting in Dearborn, Missouri. “Input prices were mixed when compared to all-time record high prices in April,” he said, “but all three commodities were in the top three for April all time.
Source: farmersadvance.com
Categories: South Dakota, Livestock, Dairy Cattle