Dairy WASDE Update – Apr ’20
According to the April USDA World Agricultural Supply and Demand Estimate (WASDE) report, the 2020 U.S. milk production projection was reduced 100 million pounds from the previous month on slower expected growth in milk yields. The average milk cow herd inventory was little changed as higher-than-expected early year inventory figures are expected to decline later in the year. 2020 projected milk production equates to a 1.5% YOY increase from 2019 production levels, finishing consistent with ten year average figures. 2020 dairy export forecasts were reduced from the previous month on both a milk-fat and skim-solids basis on weaker global demand for butterfat products, cheese, nonfat dry milk and lactose. 2020 dairy import forecasts were reduced on a milk-fat basis on lower imports of butter and unchanged on a skim-solids basis. 2020 projected dairy export volumes translated to 15.3% of total U.S. milk solids production while import volumes were equivalent to 3.6% of total U.S. milk solids production. 2020 net dairy trade is projected to rebound slightly from the 2019 levels but remain below the 2018 record highs. 2020 butter, cheese, dry whey and nonfat dry milk price forecasts were all reduced from the previous month on large supplies, weak demand and building stocks. The 2020 Class III milk price forecast of $12.75/cwt was reduced $3.90/cwt from the previous forecast while the 2020 Class IV milk price forecast of $12.15/cwt was reduced $3.60/cwt. The 2020 All-Milk price forecast of $14.35/cwt was reduced $3.90/cwt from the previous forecast, finishing 22.8% below 2019 price levels and reaching an 11 year low level, overall.