Northwest FCS Dairy Market Snapshot

Northwest Farm Credit Services Vice President of Market Research and Development Michael Stolp shares details from the third quarter results of the Dairy Market Snapshot.

Stolp: "Dairy producers faced break-even financial results and a mixed-outlook for 2014. Dairy prices are expected to remain relatively stable through year-end supported by domestic sales and export. Additionally, dairy producers profit margins may be bolstered by lower feed costs. Corn prices are significantly lower given record production and may continue to decline. However, hay prices are likely near a price floor supported with limited supplies. Looking ahead milk prices are forecast to decline in 2014, pressured by rising domestic and world production. Break-even or improved financial performance in the coming year requires continued improvements in dairy product demand or feed prices falling in step with milk prices."

The Market Snapshot gives additional information about the timely rains and favorable growing season conditions which set the stage for solid corn silage yields. Silage production is average to above average in Central Washington and Southern Idaho. Yields in Northwestern Washington are excellent, bolstered by atypically warm dry weather. Limited sales data suggest prices for standing silage between $35 and $45 per ton.

The snapshot states that domestically, demand for dairy products is stable to increasing, supported by an improving economy and rising home prices.