An updated milk outlook

Washington Ag Today August 21, 2009 Dairy cow numbers in Washington were down six-thousand head this July compared to July of 2008 at 239-thousand cows. The smaller cow herd combined with lower output per cow dropped milk production in the state 1.6 percent this July compared to July a year ago.

Dairy cow numbers are dropping nationally too. But USDA Outlook Board Chairman Gerry Bange says the numbers haven’t fallen as much as expected and that has led the Agriculture Department to increase its forecast for milk production for the rest of 2009 and 2010 compared to expectations a month ago. Still, Bange says milk production in 2010 should be down one percent from this year and if you combine that with hopes for increased demand;

Bange: “We are looking for considerably stronger prices in 2010. The all milk price for 2010 is currently forecast $15.15, whereas we are looking at an all milk price of $12.20 for 2009. So we are looking for about a 24% increase there.”

Unprofitable conditions in the dairy industry have prompted Cooperatives Working Together to conduct two rounds of dairy herd retirements this year.

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And speaking of herd retirement, three pork producer marketing groups are requesting a sow buy-out program to address the financial crisis in the pork industry. The groups are asking the USDA to evaluate the impact of a 200-million dollar federally-funded program, which would target about 500-thousand sows. Industry estimates are that pork producers are currently losing more than $30 a head with projections of 54 dollar a head loses this fall.

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I’m Bob Hoff and that’s Washington Ag Today on the Northwest Ag Information Network.