05/22/07 Milk prices at record highs

Some good news for Idaho dairy producers. COLLINS -"Slow growth in milk production plus strong demand is driving prices way up." USDA's chief economist Keith Collins is forecasting the all-milk price for this year at an all time record high of $17.30 per hundredweight, a dollar-50 higher than last year. So with these record highs producers are elated, right? Not necessarily says USDA Outlook Board Chairman Gerry Bange." BANGE "They've not been really happy with their returns. They are looking at the forage conditions which are not the best in the world. We've seen some very high prices for hay and alfalfa of late and we all know of course the prices for concentrates have been rising owing to the sharply increased prices for such commodities as corn and soybeans." Bange believes that prices will continue to rise and next year the all-milk price could increase another 20-cents to $17.50. Bange says instead of huge surpluses and prices at pennies per pound several years ago, demand for non-fat dry milk is up and the price will average a $1.40 per pound this year, $1.45 next year. Voice of Idaho Agriculture Bill Scott