04/18/06 USDA sees lower milk prices for farmers

Look for an increase in milk production in 2006. That is what USDA is expecting and World Outlook Board Chairman Gerald Bange believes that American milk production will be up about three percent over last year. BANGE "We've increased our estimate of 2006 milk production up to 182.2 billion pounds. That's an increase of 300 million pounds from our previous forecast and reflects the very, very strong numbers that we have seen, production numbers we've seen in January and February. That's output per cow and we've seen the cow numbers increasing." It's the old supply and demand rule, and that higher supply equates to lower prices for dairy producers. BANGE "We're now looking at a price, an all milk price which is about $12.80 per hundredweight, that's down 25 cents from our previous forecast." If those numbers bear out for 2006 it means dairy farmers will see prices that are down $2.35 from the $15.15 that was reported last year and obviously down sharply from the $16.05 figure recorded in 2004. Today's Idaho Ag News Bill Scott