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USDA dairy outlook: November 2013

USDA dairy outlook: November 2013
As usual, USDA’s monthly Livestock, Dairy & Poultry Outlook report mirrored dairy projections contained in the latest  World Ag Supply & Demand Estimates (WASDE) report, released Nov. 8. Feed prices are expected to moderate in 2014, easing profit pressure on producers and leading to a modest increase in herd size in 2014. Imports on both a fats and skims-solids basis are forecast lower this month than in September and exports are raised.
Exports on both a fats and skims-solids basis will slip in 2014 compared with 2013 as foreign competition increases. Herd size projections were resumed this month, and the National Agricultural Statistics Service estimated the nation’s herd at 9.237 million head for the July-September quarter.
The U.S. dairy herd is expected to average 9.225 million head in 2013 and increase to 9.245 million head in 2014 as producers respond to improved returns. The current-year milk yield per cow is forecast at 21,865 lbs. Milk per cow is forecast at 22,170 lbs. next year, based on expectations that cheaper feed and abundant forages will support improved yields. Milk production this year is projected at 201.7 billion lbs., slightly lower than forecast in September. Production in 2014 is forecast at 204.9 billion lbs., based on slightly higher cow numbers next year and trend yield growth. The improved feed price outlook should lead to some herd expansion in 2014.
• 2013 production and marketings were projected at 201.7 billion lbs. and 200.7 billion lbs., respectively. If realized 2013 production and marketings would be up about 0.7% from 2012.
• 2014 production and marketings were projected at 204.9 billion lbs. and 203.9 billion lbs. respectively. If realized, 2014 production and marketings would be up about 1.6% from 2013.
Looking ahead: There’ll be lots for dairy traders to think on next week. The preliminary estimate on October milk production is issued Tuesday afternoon. The federal order Class I base milk price is announced on Wednesday; Livestock Slaughter report on Thursday; and October Cold Storage report on Friday.
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