In your issue of September 10, 2021. . .
“Future markets seem to be nervous in the long term and our milk checks live in the present,” wrote Mark Stephenson in Milk Check Outlook on the next page. That’s because most farmers, processors, and forecasters can’t see around the corner of the COVID-19 market.
AT THE CLOSING OF THE MAGAZINE, CLASS III contracts were trading in an ever-narrow window of $ 17.15 to $ 17.42 for the first six months of the new year, averaging $ 17.30. Class IV had a slightly larger range of $ 16.56 to $ 16.98 for net income of $ 16.80 from January to June 2022.
FOR THE REMAINING YEAR, Class III contracts ranged from $ 16.90 to $ 17.25 with an average of $ 17.30. Class IV had an equally narrow footprint of $ 16.10 to $ 16.50 for an average of $ 16.25.
NEGATIVE PRODUCER PRICE DIFFERENTIALS (PPDs) eventually began to fade as markets returned to more traditional pre-pandemic pricing patterns. This resulted in positive PPDs from coast to coast milk controls in July. The Northeast order saw the highest PPD at $ 1.57 per cwt, and the lowest was a positive 25 cents in the Upper Midwest.
DAIRY WILL RECEIVE 350 MILLION through USDA’s Pandemic Market Volatility Support Program. The program will reimburse dairy farmers 80% of the monthly income gap based on annual production of up to 5 million pounds of marketed milk and liquid sales from July through December 2020, the USDA reported on Aug. 19.
THE FLORIDA, APPALACHIAN, AND SOUTHEAST ORDERS will receive the highest payouts, ranging from a projected $ 1.12 to $ 1.42 due to the large Class I sales. The remaining eight orders would be 9 to 50 cents per cwt, with the upper Midwest being on the lower end.
SNAP RECIPIENTS GET 25% BUMP in Food Aid. A total of 42 million Americans receive the Supplemental Nutrition Assistance Program (SNAP) benefits, half of which are children. The adjustment could raise $ 2 billion more for dairy products. Read more on page 492.
THE CANADIAN HEIFER STOCK (1 year and older) was 445,500 in July, an increase of 1% compared to 2020 and 1.5% more than five years ago.
There were 4.1 million heifers (over 500 pounds) in the US in July, 2.5% more than last year but 2.3% less than five years ago.
FILM IN LIQUID MILK SALES WAS RETURNED when Americans grew tired of COVID-19 precautions. These sales are shown in the graphic below.