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If there was any silver lining in the terrible milk prices earlier this spring, it was that U.S. dairy product prices were competitive on the global market, resulting in the highest export volumes in more than two years. While enjoying those numbers, U.S. dairy industry leaders also celebrated the U.S.-Mexico-Canada Agreement (USMCA) going into force on July 1.
Dairy farmers banking on the surge in cheese prices to have an immediate and equally explosive impact on their milk checks should rein in expectations. Analysis by leading U.S. dairy economists warn that negative producer price differentials (PPDs) and depooling will sharply limit any price increases many dairy farmers will receive in their milk checks this summer.
As expected, a further downturn in May’s U.S. average milk price has triggered monthly Dairy Margin Coverage (DMC) program indemnity payments even larger than the payments in April.
Progressive Dairy provides updates on dairy-related organizations and companies, compiled from staff news sources and industry press releases. Email industry and organization news to Progressive DairyEditor Jenna Hurty.
Business Digest Highlights
Editor's note: This article has been updated to include market commentary.
Declines in both cow numbers and milk production per cow resulted in lower U.S. milk production in May as dairy farmers adjusted to COVID-19-related production restrictions and low milk prices.
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