May Class I base announced; MILC estimate updated
PrintThe May federal order Class I base milk price is $15.85/cwt., up 19¢ from April 2012, but $3.90 less than May 2011. Through the first five months of 2012, the Class I average is $16.73/cwt., down from $17.70/cwt. for the same period of 2011.
Using federal order prices and April 18 settlement futures prices for related contracts, Dr. Brian Gould, University of Wisconsin-Madison Department of Agriculture and Applied Economics professor, revised estimates for Milk Income Loss Contract (MILC) payments for the remainder of 2012 (see below). He projects a May MILC payment of 63.41¢/cwt.
Gould currently expects MILC payments will continue through September, peaking in June and July. Estimates are always subject to change. To see a new summary spreadsheet, go to the UW-Madison “Understanding Dairy Markets” website: http://future.aae.wisc.edu/collection/software/current_MILC_est.xls.
2012 MILC payment forecasts
2012 MILC payment forecasts based on
futures settlement prices, April 18, 2012
($ per hundredweight)
Forecast Predicted
Target Forecast MILC
Month Mover Mover Payment
Jan. ’12 17.53* 18.80* 0.0000*
Feb. ’12 17.90* 17.03* 0.3895*
Mar. ’12 18.27 16.30* 0.8877
Apr. ’12 17.44 15.66 0.8008
May ’12 17.26 15.85 0.6341
June ’12 17.14 14.68 1.1055
July ’12 17.00 14.93 0.9329
Aug. ’12 16.64 15.18 0.6556
Sep. ’12 16.25 15.85 0.1807
Oct. ’12 16.11 16.20 0.0000
Nov. ’12 15.99 16.16 0.0000
Dec. ’12 15.87 16.15 0.0000
*Actual Target, Target Mover, MILC Payment
Source: Brian W. Gould, Associate Professor, Department of Agricultural and Applied Economics, University of Wisconsin-Madison ( http://future.aae.wisc.edu/collection/software/current_MILC_est.xls)
