A grim dairy outlook

Washington Ag March 4, 2009 For U.S. dairy producers and their production, prices, profits and exports in 2008; Hoskin: “High. High and high.� And for the 2009 year the prognostication is; Hoskin: “Low. Low. Low and low.� That was USDA analyst Rodger Hoskin telling last week’s USDA Outlook Forum the grim outlook for dairy, which by the way is Washington’s number two commodity in terms of production value. One positive note; feed prices may moderate this year. Stephenson: “But it won’t be enough. But assuming no significant herd reduction early in the year milk prices are expected to plummet to the lowest level in years. We have all milk price forecast to reach its lowest level since 1978.� That is Cornell University’s Mark Stephenson who says the result will be eventually; Stephenson: “Fewer cows, lower milk production, but those adjustments don‘t happen quickly.� Some analysts expect some recovery this year in world and U.S. demand for dairy products but not Stephenson. Stephenson: “I don’t see any real recovery this year. Maybe, with luck, in 2010.� He said by that time a significant number of dairies will have likely liquidated and gone out of business. Ten Washington dairy herds were retired in the second herd retirement round held this year by Cooperatives Working Together, a dairy industry run self-help program. Two of the ten herds were in eastern Washington, the other eight on the west side. The cows in those herd were sent to processing. I’m Bob Hoff and that’s Washington Ag Today on the Northwest Ag Information Network.