As the days get shorter and the weather cools, harvest is in full swing for dairy farmers around the country. As another crop year comes to a close, farmers are likely rejoicing at recent milk checks though the September Class III milk price settled at $23.34 per hundredweight, the highest in more than two years, since June 2022. Stronger milk prices coupled with lower feed costs support margins, with profits especially welcome after more than one year of struggling profitability.
A weaker milk supply has finally resulted in price strength in certain dairy products. US milk output has been lower than the prior year for 14 consecutive months now, a rare period of weakness for the US industry. On a global level, trends have also been similar, with milk output struggling in the EU and New Zealand. While components are impressive and continue to grow, less milk is causing some concern and pushing prices higher.
By Lucas Fuess
October 22, 2024
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