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  • ZISK

Dairy Prices Show Some Improvement in 3rd Quarter

Producer milk prices have fallen tremendously in 2023. The big question is "When will prices improve to make milk production profitable again?" The reasons for the fall in prices was covered in a recent post. This post will look to the future to see when and by how much producer milk prices may increase. The volatility during the span of data in this review is tremendous. Three-year trends and quarterly price changes will be reviewed in this post.

Butterfat prices have been a big contributor to the producer milk price and will be reviewed first. Butterfat values increased tremendously in 2021 and most of 2022. Then butter consumption declined (see the September 10 post) and the Butterfat price declined by 25% in three months. Recently producer butterfat prices have started increasing and may reclaim the higher prices in the fourth quarter of 2023.

Butterfat prices grew tremendously in late 2021 and all of 2022 (Table I). Immediately in 2023 the prices dropped and have remained around $2.74 per pound for the first six months. In the third quarter of this year the butterfat prices started increasing. This will likely continue in the fourth quarter and will reach $3 per pound pricing. This increase will be a strong factor for all dairy producer pricing in 2024.

October 8, 2023


John Geuss




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