Dairy WASDE Update – Dec ’20
According to the December USDA World Agricultural Supply and Demand Estimate (WASDE) report, the 2020 U.S. milk production projection was raised two million pounds from the previous month on higher cow inventories. 2020 projected milk production equates to a 1.7% YOY increase from 2019 production levels, slightly above ten year average figures. 2020 YTD milk production has increased 1.6% on a YOY basis through the first ten months of the calendar year.
The 2021 milk production projection was raised four million pounds from the previous month, also on higher cow inventories. 2021 projected milk production equates to a 1.9% YOY increase from 2020 projected levels, on pace to reach a seven year high growth rate. The 2021 milk production projection was the largest experienced throughout the eight months of available projections.
2020 dairy export forecasts were reduced from the previous month on a milk-fat basis on weaker foreign demand for cheese but raised on a skim-solids basis on strong global demand for whey and whey products. 2020 dairy import forecasts were reduced on a milk-fat basis on lower imports of butterfat products and unchanged on a skim-solids basis.
2021 dairy export forecasts were raised on both a milk-fat and skim-solids basis on larger shipments of nonfat dry milk, dry whey and a number of other dairy products. 2021 dairy import forecasts were reduced on a milk-fat basis and unchanged on a skim-solids basis.
2020 projected dairy export volumes translated to 16.7% of total U.S. milk solids production while import volumes were equivalent to 3.7% of total U.S. milk solids production. 2021 projected dairy export volumes translated to 17.0% of total U.S. milk solids production, up slightly from the previous year projection, while import volumes were equivalent to 3.7% of total U.S. milk solids production, consistent with the previous year projection. 2021 net dairy trade is projected to reach a record high level, exceeding the previous record high level projected throughout 2020.
2020 butter and cheese price forecasts were reduced from the previous month on recent price movements however the 2020 dry whey price forecast was raised from the previous month while the nonfat dry milk price forecast was unchanged.
The 2020 Class III milk price forecast of $18.20/cwt was reduced $0.35/cwt from the previous forecast as lower cheese prices more than offset higher dry whey prices while the 2020 Class IV milk price forecast of $13.45/cwt was reduced $0.05/cwt on lower butter prices. The 2020 All-Milk price forecast of $18.25/cwt remained unchanged from the previous forecast, finishing 2.0% below 2019 price levels.
2021 butter and cheese price forecasts were reduced from the previous month on weaker expected demand and larger supplies however the 2021 dry whey and nonfat dry milk price forecasts were raised from the previous month.
The 2021 Class III milk price forecast of $15.60/cwt was reduced $1.65/cwt from the previous forecast as lower cheese prices more than offset higher dry whey prices, finishing 14.3% below the 2020 projected level. The 2021 Class IV milk price forecast of $13.60/cwt was reduced $0.40/cwt from the previous forecast as lower butter prices more than offset higher nonfat dry milk prices but remained 1.1% above the 2020 projected level. The 2021 All-Milk price forecast of $16.60/cwt was reduced $1.10/cwt from the previous forecast, finishing 9.0% below 2020 projected levels and reaching a three year low level.
2020 dairy export forecasts were reduced from the previous month on a milk-fat basis on weaker foreign demand for cheese but raised on a skim-solids basis on strong global demand for whey and whey products. 2020 dairy import forecasts were reduced on a milk-fat basis on lower imports of butterfat products and unchanged on a skim-solids basis.
2021 dairy export forecasts were raised on both a milk-fat and skim-solids basis on larger shipments of nonfat dry milk, dry whey and a number of other dairy products. 2021 dairy import forecasts were reduced on a milk-fat basis and unchanged on a skim-solids basis.
2020 projected dairy export volumes translated to 16.7% of total U.S. milk solids production while import volumes were equivalent to 3.7% of total U.S. milk solids production. 2021 projected dairy export volumes translated to 17.0% of total U.S. milk solids production, up slightly from the previous year projection, while import volumes were equivalent to 3.7% of total U.S. milk solids production, consistent with the previous year projection. 2021 net dairy trade is projected to reach a record high level, exceeding the previous record high level projected throughout 2020.
2020 butter and cheese price forecasts were reduced from the previous month on recent price movements however the 2020 dry whey price forecast was raised from the previous month while the nonfat dry milk price forecast was unchanged.
The 2020 Class III milk price forecast of $18.20/cwt was reduced $0.35/cwt from the previous forecast as lower cheese prices more than offset higher dry whey prices while the 2020 Class IV milk price forecast of $13.45/cwt was reduced $0.05/cwt on lower butter prices. The 2020 All-Milk price forecast of $18.25/cwt remained unchanged from the previous forecast, finishing 2.0% below 2019 price levels.
2021 butter and cheese price forecasts were reduced from the previous month on weaker expected demand and larger supplies however the 2021 dry whey and nonfat dry milk price forecasts were raised from the previous month.
The 2021 Class III milk price forecast of $15.60/cwt was reduced $1.65/cwt from the previous forecast as lower cheese prices more than offset higher dry whey prices, finishing 14.3% below the 2020 projected level. The 2021 Class IV milk price forecast of $13.60/cwt was reduced $0.40/cwt from the previous forecast as lower butter prices more than offset higher nonfat dry milk prices but remained 1.1% above the 2020 projected level. The 2021 All-Milk price forecast of $16.60/cwt was reduced $1.10/cwt from the previous forecast, finishing 9.0% below 2020 projected levels and reaching a three year low level.