For 2021, the USDA forecasts milk production at 228.2 billion pounds, down 300 million pounds from last month’s estimate due to slower expected growth in milk per cow, offsetting higher cow numbers. If realized, 2021 production would be up about 2.2% from 2020.
For 2021, cheese, butter, nonfat dry milk (NDM) and whey price forecasts were lowered from last month on relatively high stocks and weaker demand. As a result, projected 2021 Class III and Class IV prices were lowered to $16.80 and $15.40 per hundredweight (cwt), respectively. The 2021 all milk price forecast was lowered 55 cents from last month to $18.30 per cwt, nearly the same as the 2020 average of $18.24 per cwt.
In the USDA’s look ahead to 2022, milk production was forecast at 231.6 billion pounds, up 500 million pounds from last month as cow numbers continue to grow. If realized, 2022 production would be up about 1.5% from the 2021 forecast.
For 2022, price forecasts for cheese and butter were lowered on larger expected stocks and higher production, but price forecasts for NDM and whey are unchanged. With lower cheese and butter prices, the annual average Class III ($16.75 per cwt) and Class IV ($15.75 per cwt) price forecasts were reduced from last month, and the projected all-milk price was cut 25 cents to $18.50 per cwt.
USDA’s Cattle report, to be released on July 23, will provide a mid-year estimate of the dairy cow inventory and producer intentions regarding retention of heifers for dairy cow replacement.
The 2021 beef production forecast was unchanged as higher slaughter was offset by lower expected carcass weights; the projected annual average fed cattle price was raised $2 from last month to about $119 per cwt, up $11 from the 2020 average.
Corn and soybean outlook
Based on WASDE supply and demand estimates, feed supply and cost projections included:
– Corn: Compared to a month ago, the 2021-22 U.S. corn outlook estimated larger supplies, greater feed and residual use, increased exports and higher ending stocks. At $5.60 per bushel, the projected season-average corn price received by producers would be about $1.20 (27%) more than the 2020-21 average of $4.40 per bushel and $2.04 more than the 2019-20 average of $3.56 per bushel.
– Soybeans: The 2021-22 U.S. soybean supply and use forecasts were unchanged from last month. The projected U.S. season-average soybean price received by producers was lowered 15 cents from last month to $13.70 per bushel, up $2.65 (24%) from the 2020-21 average of $11.05 per bushel. The projected soybean meal price was forecast at $395 per ton, down $5 from the previous month. If realized, it would be unchanged from the 2020-21 average but up more than $95 per ton from 2019-20.