The USDA’s October World Ag Supply and Demand Estimates (WASDE) report boosted milk production forecasts for both 2018 and 2019, while also projecting only a slight improvement in 2019 prices.

Natzke dave
Editor / Progressive Dairy

Citing increased milk output per cow, the USDA’s 2018 milk production estimate now stands at 218.1 billion pounds, up 300 million pounds from last month’s forecast. That would be up about 1.2 percent from 2017’s production total of 215.5 billion pounds.

Based on current estimates, USDA left 2018 projected average milk prices (midpoint of range) mostly unchanged from a month ago. Projected annual average prices for 2018 are: Class III – $14.90 per hundredweight (cwt); Class IV – $14.25 per cwt; and all-milk – $16.40 per cwt.

For 2019, the USDA bumped its milk production forecast to 221.4 billion pounds, about 400 million pounds more than September’s forecast, based on higher cow numbers. If realized, it would be up about 1.5 percent from the level forecast for 2018.

In its price projections for 2019, the USDA forecast (midpoint of range): Class III – $15.75 per cwt; Class IV – $14.85 per cwt; and all-milk – $17.30 per cwt. Those estimates are up about a nickle from last month’s forecast, but remain weaker than prices seen in 2017.


Coming up: The USDA’s September 2018 Milk Production report will be released Oct. 19.

Beef outlook

The 2018 beef production forecast was lowered from last month due to lower expected fourth-quarter fed cattle slaughter. Carcass weights are forecast lower on a higher expected proportion of cows in the slaughter mix. Fourth-quarter and annual price projections were raised slightly.

For 2019, beef production is raised from last month, as the larger number of cattle placed in feedlots are marketed during 2019. However, carcass weight estimates were lowered for the early part of the year. Strongest beef prices are forecast for the first half of the year

Feed outlook

The USDA’s monthly Crop Production report was released simultaneously with the WASDE report, providing a first look at crop harvest estimates and offering some insights into dairy feed costs.

• Corn: U.S. corn production is forecast at 14.78 billion bushels, down slightly from the September forecast, but up 1 percent from last year. Area harvested for grain was forecast at 81.8 million acres, down 1 percent from 2017.

Based on conditions as of Oct. 1, yields are expected to average 180.7 bushels per acre, up 4.1 bushels from 2017. Record-high yields are forecast for Alabama, Illinois, Indiana, Iowa, Kentucky, Michigan, Nebraska, New York, Ohio, South Dakota, Tennessee and Wisconsin.

If realized, this will be the highest yield and second-highest production on record for the U.S.

With increased corn production, the USDA’s WASDE report raised expected ending stocks for 2018-19. The projected season-average corn price received by producers was left unchanged at the midpoint, to $3.50 per bushel.

• Soybeans: U.S. soybean production was forecast at a record 4.69 billion bushels, down slightly from September but up 6 percent from last year. Area for harvest was forecast at 88.3 million acres, down 1 percent from 2017.

Based on Oct. 1 conditions, yields are expected to average a record 53.1 bushels per acre, up 3.8 bushels from last year. Compared with 2017, soybean pod counts were up in eight of 11 major soybean-producing states. Record yields were forecast for Alabama, Illinois, Indiana, Iowa, Kentucky, Mississippi, Nebraska, New York, Ohio, Pennsylvania, South Dakota and Tennessee.

Soybean supplies for 2018-19 are projected at a record high. With soybean use unchanged, ending stocks are projected at 885 million bushels.

Projected 2018-19 marketing-year average prices paid to growers for soybeans were left unchanged. The soybean price was forecast in a wide range ($7.35 to $9.85 per bushel), with $8.60 per bushel as a midpoint. The soybean meal price forecast, in a range of $290 to $330 per ton, yields a midpoint of $310 per ton.

• Cottonseed: Despite hurricane damage, USDA’s October Crop Production report adjusted the cottonseed harvest slightly higher to 6.18 million tons. While the crop is about 4 percent less than last year, it’s still projected to be the second-largest harvest since 2007.

• Alfalfa hay: The first estimates of the year project production of alfalfa and alfalfa-mixture dry hay at 59.5 million tons, up 8 percent from 2017. Based on Oct. 1 conditions, yields are expected to average 3.43 tons per acre, up 0.11 ton from last year. Harvested area was forecast at 17.4 million acres, up 5 percent from 2017.

On the basis of more acreage and stronger yields, Idaho became the nation’s leader in total production. With the 2017 drought in their rearview mirror, the top three states in terms of alfalfa acreage – Montana, North Dakota and South Dakota – saw substantial increases in acreage, yield and total production in 2018. A record-high yield was expected in Pennsylvania.

• Other hay: Production of other hay was forecast at 74.9 million tons, up 6 percent from the August forecast but down 2 percent from 2017. Based on Oct. 1 conditions, the U.S. yield is expected to average 1.98 tons per acre, down 0.07 ton from last year. Harvested area was forecast at 37.7 million acres, up 1 percent from 2017.

Leading producers of other hay – Texas and Missouri – saw a substantial drop in 2018 yields due to drought. However, favorable conditions in Alabama, Georgia, Kentucky, Montana, Nebraska and Oklahoma have producers expecting record-high yields for the year.  end mark

Dave Natzke