Dairy WASDE Update – Nov ’20
According to the November USDA World Agricultural Supply and Demand Estimate (WASDE) report, the 2020 U.S. milk production projection was raised two million pounds from the previous month on both stronger growth in milk per cow yields and higher expected dairy cow inventories. 2020 projected milk production equates to a 1.6% YOY increase from 2019 production levels, slightly above ten year average figures.
The 2021 milk production projection was raised four million pounds from the previous month, also on both stronger growth in milk per cow yields and higher expected dairy cow inventories. 2021 projected milk production equates to a 1.8% YOY increase from 2020 projected levels, on pace to reach a seven year high growth rate. The 2021 milk production projection was the largest experienced throughout the seven months of available projections.
2020 dairy export forecasts were raised from the previous month on both a milk-fat and skim-solids basis on greater shipments of butterfat, cheese and skim milk powder. 2020 dairy import forecasts were raised on a milk-fat basis on higher expected imports of butterfat and cheese but reduced on a skim-solids basis on lower imports of low-fat milk powders.
2021 dairy export forecasts were unchanged on a milk-fat basis but raised on a skim-solids basis on stronger expected sales of skim milk powder. 2021 dairy import forecasts were raised on a milk-fat basis on higher expected imports of butterfat and cheese but reduced on a skim-solids basis on lower imports of a number of dairy products.
2020 projected dairy export volumes translated to 16.7% of total U.S. milk solids production while import volumes were equivalent to 3.7% of total U.S. milk solids production. 2021 projected dairy export volumes also translated to 16.9% of total U.S. milk solids production, up slightly from the previous year projection, while import volumes were equivalent to 3.7% of total U.S. milk solids production, consistent with the previous year projection. 2021 net dairy trade is projected to reach a record high level, slightly exceeding the 2020 projected levels.
2020 cheese, dry whey and nonfat dry milk price forecasts were raised from the previous month on strength in demand however the 2020 butter price forecast was reduced from the previous month on current and expected continued weakness in prices. The 2020 Class III milk price forecast of $18.55/cwt was raised $0.55/cwt from the previous forecast while the 2020 Class IV milk price forecast of $13.50/cwt was unchanged from the previous month as higher nonfat dry milk prices offset the lower butter price. The 2020 All-Milk price forecast of $18.25/cwt was raised $0.25/cwt from the previous forecast but remained 2.0% below 2019 price levels.
2021 cheese, dry whey and nonfat dry milk price forecasts were raised from the previous month on continued strength in demand however the 2021 butter price forecast was reduced on lower expected prices throughout the first part of the year. The 2021 Class III milk price forecast of $17.25/cwt was raised $0.25/cwt from the previous forecast but remained 7.0% below the 2020 projected level. The 2021 Class IV milk price forecast of $14.00/cwt was reduced $0.10/cwt from the previous forecast but remained 3.7% above the 2020 projected level. The 2021 All-Milk price forecast of $17.70/cwt was raised $0.10/cwt from the previous forecast but remained 3.0% below 2020 projected levels, reaching a three year low level.
2020 dairy export forecasts were raised from the previous month on both a milk-fat and skim-solids basis on greater shipments of butterfat, cheese and skim milk powder. 2020 dairy import forecasts were raised on a milk-fat basis on higher expected imports of butterfat and cheese but reduced on a skim-solids basis on lower imports of low-fat milk powders.
2021 dairy export forecasts were unchanged on a milk-fat basis but raised on a skim-solids basis on stronger expected sales of skim milk powder. 2021 dairy import forecasts were raised on a milk-fat basis on higher expected imports of butterfat and cheese but reduced on a skim-solids basis on lower imports of a number of dairy products.
2020 projected dairy export volumes translated to 16.7% of total U.S. milk solids production while import volumes were equivalent to 3.7% of total U.S. milk solids production. 2021 projected dairy export volumes also translated to 16.9% of total U.S. milk solids production, up slightly from the previous year projection, while import volumes were equivalent to 3.7% of total U.S. milk solids production, consistent with the previous year projection. 2021 net dairy trade is projected to reach a record high level, slightly exceeding the 2020 projected levels.
2020 cheese, dry whey and nonfat dry milk price forecasts were raised from the previous month on strength in demand however the 2020 butter price forecast was reduced from the previous month on current and expected continued weakness in prices. The 2020 Class III milk price forecast of $18.55/cwt was raised $0.55/cwt from the previous forecast while the 2020 Class IV milk price forecast of $13.50/cwt was unchanged from the previous month as higher nonfat dry milk prices offset the lower butter price. The 2020 All-Milk price forecast of $18.25/cwt was raised $0.25/cwt from the previous forecast but remained 2.0% below 2019 price levels.
2021 cheese, dry whey and nonfat dry milk price forecasts were raised from the previous month on continued strength in demand however the 2021 butter price forecast was reduced on lower expected prices throughout the first part of the year. The 2021 Class III milk price forecast of $17.25/cwt was raised $0.25/cwt from the previous forecast but remained 7.0% below the 2020 projected level. The 2021 Class IV milk price forecast of $14.00/cwt was reduced $0.10/cwt from the previous forecast but remained 3.7% above the 2020 projected level. The 2021 All-Milk price forecast of $17.70/cwt was raised $0.10/cwt from the previous forecast but remained 3.0% below 2020 projected levels, reaching a three year low level.