The USDA’s monthly World Ag Supply and Demand Estimates (WASDE) report was released June 9. Compared to last month, the USDA reduced the U.S. 2023 milk production estimate slightly, but again cut Class III and all-milk price forecasts.
- At 228.4 billion pounds, the 2023 production forecast was cut by 200 million pounds from last month due to slower growth in milk output per cow. If realized, 2023 production would be up just 0.8% from 2022.
For 2023, projected annual average prices for butter and nonfat dry milk (NDM) were raised from the previous month on recent price strength and anticipated demand, while cheese and whey price forecasts were lowered. As a result, the projected 2023 Class III price was cut $1.10 to $16.70 per cwt, while the Class IV price forecast was raised a nickel to $18.35 per cwt. The projected 2023 all-milk price was cut 65 cents to $19.95 per cwt.
- In its look ahead to 2024, the USDA forecast milk production at 230.8 billion pounds, unchanged from a month earlier, driven by gains in milk per cow and an additional milking day in Leap Year. If realized, 2024 production would be up about 1% from 2023.
Milk price projections for 2024 follow patterns similar to 2023: Class III and all-milk price forecasts were lowered from last month, with Class IV price boosted slightly. The 2024 Class III price forecast is $17 per cwt, the Class IV price forecast is $17.45 per cwt, and the 2024 all-milk price is $19.65 per cwt.
Beef outlook
For 2023, the beef production forecast was raised from last month based on higher slaughter rates, including cows and heifers. Beef production in 2024 was also forecast higher due to increased feedlot placements in 2023.
Potentially affecting cull cow prices, the fed cattle price forecast for 2023 was estimated at $171.70 per cwt, up $5 from last month’s forecast. The early forecast for 2024 was estimated even higher at $182 per cwt.
Feed supply, price forecasts
USDA will release its annual Acreage report on June 30, providing survey-based indications of planted and harvested area for major crops. The WASDE report provided potential insights into dairy feedstuff supplies and prices:
- Corn: This month’s WASDE 2023-24 U.S. corn outlook was little changed from last month, with increases to both beginning and ending stocks. At $4.80 per bushel, the projected season-average corn price received by producers was unchanged from the May forecast but is down $1.80 (27%) from the 2022-23 average of $6.60 per bushel.
- Soybeans: The 2023-24 U.S. soybean supply and use outlook raised the estimate for beginning stocks, reflecting lower-than-expected exports in May. Soybean and soybean meal price projections were unchanged compared to last month. The 2023-24 U.S. season-average soybean price was forecast at $12.10 per bushel compared with $14.20 per bushel in 2022-23. Soybean meal prices were forecast at $365 per ton, down $80 from the 2022-23 average.
