The USDA’s monthly World Ag Supply and Demand Estimates (WASDE) report was released May 10.
Milk production, prices
The milk production forecast for 2024 was raised from last month based on an increase in dairy cows and more rapid growth in output per cow. Milk production in 2025 is also forecast to increase from 2024, driven by higher milk per cow and an expanding milk cow herd.
- At 227.3 billion pounds, the 2024 milk production estimate was raised 1 billion pounds from last month’s report and is up 900 million pounds from 2023’s total of 226.4 billion pounds.
On both a fat and skim-solids basis, imports are raised and exports are lowered. Domestic use is higher on both a fat and skim-solids basis, as well. Based on strong demand and recent price strength, the 2024 cheese and butter price forecasts were raised, while nonfat dry milk and whey price forecasts were lowered based on recent prices. The 2024 projected Class III price was raised 55 cents to $16.75 per hundredweight (cwt). The 2024 Class IV price estimate was reduced at $20.25 per cwt. The all-milk price for 2024 was raised to $21.20 per cwt.
- In its forecast for 2025, the USDA estimated milk production at 229.3 billion pounds, 2 billion pounds more than 2024’s forecast of 227.3 billion pounds.
With increases in a number of products, commercial exports and domestic use are expected to grow on both a fat and skim-solids basis. The initial projected 2025 Class III milk price is $16.30 per cwt and the Class IV price is $19.95 per cwt. The all-milk price is forecast at $20.90 per cwt.
Beef outlook
For 2024, the beef production forecast was lower as tighter cattle supplies and increased heifer and cow retention are expected to result in lower slaughter of both fed and non-fed cattle. Lower expected slaughter in the first quarter is more than offset by higher slaughter for outlying quarters. As these cattle are placed on feed in the first half of the year, they will likely be marketed and slaughtered in the second half.
For 2025, cattle prices are above 2024 on tighter cattle and beef supplies. The fed cattle price forecast for 2024 was estimated at $183 per cwt, with prices reaching $187 per cwt in the fourth quarter. The 2023 average was $175.54 per cwt.
Feed supply, price forecasts
The USDA’s WASDE reports provided potential insights into dairy feedstuff supplies and prices:
- Corn: This month’s 2023-24 U.S. corn outlook called for larger supplies, greater domestic use and exports, and higher ending stocks.
The corn crop is projected at 14.9 billion bushels, down 3% from last year’s record as a decline in area is partially offset by an increase in yield. The yield projection of 181 bushels per acre is based on a weather-adjusted trend assuming normal planting progress and summer growing-season weather, estimated using the 1988-2023 time period. With higher beginning stocks, total corn supplies are forecast at 16.9 billion bushels, the highest since 2017-18.
Total U.S. corn use for 2024-25 is forecast to rise just under 1% relative to a year ago on higher domestic use and exports. Food, seed and industrial use is forecast at 6.9 billion bushels. Corn used for ethanol is unchanged relative to a year ago, based on expectations of essentially flat motor gasoline consumption. Feed and residual use is projected higher on larger supplies and lower expected prices.
At $4.40 per bushel, the projected season-average corn price received by producers was lowered 30 cents from the April forecast and is down 25 cents from the 2023-24 average of $4.65 per bushel.
- Soybeans: This month’s 2023-24 U.S. soybean outlook includes higher supplies, crush, exports and ending stocks compared with 2023-24.
The soybean crop is projected at 4.45 billion bushels, up 285 million on higher area and trend yield. With higher beginning stocks and production, soybean supplies are forecast at 4.8 billion bushels, up 8% from 2023-24. Total U.S. oilseed production is projected at 131.2 million tons, up 8.9 million from 2023-24 on higher soybean, cottonseed and peanut production partly offset by lower rapeseed and sunflower seed.
U.S. soybean crush for 2024-25 is projected at 2.43 billion bushels, up 125 million from the 2023-24 forecast on higher demand for soybean oil as a biofuel feedstock, projected to increase 1 billion pounds to 14 billion. Domestic soybean meal disappearance is forecast to increase 3% from 2023-24 on increased pork and poultry production. U.S. soybean meal exports are forecast at 17.3 million short tons, indicating a 21% share of global trade, compared to the prior five-year average of 19%.
The 2024-25 U.S. season-average soybean price received by producers was forecast at $11.20 per bushel, down $1.35 from the average price of $12.55 per bushel in 2023-24. Soybean meal prices were forecast to average $330 per ton, down $50 from the 2023-24 average of $380 per ton and $122 less than the 2022-23 average of $452 per ton.
As a predictor of cottonseed availability, 2024-25 harvested cotton acreage was forecast at 9.13 million acres, up more than 2.6 million acres from 2023-24. Cotton production is increased to 16 million 480-pound bales, up about 4 million bales from 2023-24.
- Hay: The May 2024 Crop Production report updated information on hay inventories. With a new harvest season getting underway, dry hay inventories stored on U.S. farms as of May 1 were up substantially from a year earlier. Although mixed among major dairy states, total hay inventories in those states were estimated about 30% higher than on May 1, 2023, according to the USDA’s Crop Production report, also released May 10.
As of May 1, 2024, all hay stored on U.S. farms was estimated at 21 million tons, up nearly 6.7 million tons (47%) from the same date a year ago and the largest amount stored on farms as of May 1 since 2017.
Among the 24 major dairy states, on-farm hay inventories on May 1 were estimated at 11.6 million tons, up 2.7 million tons from May 1, 2023.
There was a wide variation among individual dairy states and regions. Largest increases among dairy states were in South Dakota, Colorado, Texas and Kansas, each up 500,000-600,000 tons from a year earlier.
In contrast, year-to-year hay inventories were down 170,000 tons each in New York, Minnesota and Wisconsin. Hay inventories were also smaller in California and Pennsylvania.
Among all states, biggest gains in hay inventories were in Oklahoma (up 1.4 million tons) and Montana (up 1.14 million tons). Record high May 1 hay stock levels were estimated in Montana, Oklahoma and Utah.
The latest USDA Ag Prices report indicated dairy-quality alfalfa hay prices averaged $271 per ton in March, while all alfalfa hay prices averaged $195 per ton and prices for other hay averaged $161 per ton.
The spread between U.S. average alfalfa and other hay prices – at more than $100 per ton last May and June – was $34 per ton in March.
