Dairy Producers Ready For Better Milk Prices In 2017

Milk Prices Hit New High In December As Farmers Enjoy Lower Feed Costs, Increased Exports
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Kristian Knutsen

Wisconsin dairy producers saw an increase in milk prices in December, reaching the highest price in the last two years.

Last month producers received $17.40 per hundredweight, or 100 pounds of milk. It's the highest base price since they started to fall in 2014.

Even with December's record, the average price for 2016 was less than $15. That's down about 6 percent from 2015 and 33 percent from 2014.

But the new year could bring a more positive outlook for the industry.

"With lower feed prices, better milk prices, you're going to see farmers respond to that a little bit," said Bob Cropp, University of Wisconsin-Madison professor emeritus. "We're looking for milk production to grow 2 percent, but we're looking for continued strong demand for cheese and butter."

Barring changes in exports or production, Cropp predicts prices will average $2 higher in 2017.

That’s welcome news for Todd Doornink, owner of Jon-De Farms in Baldwin.

"2016 was not a stellar year, that's for sure, but 2017 has some opportunities to at least break even for a lot of producers, us included," said Doornink, vice president of the Dairy Business Milk Marketing Cooperative.

Doornink said the recent drop in feed costs will definitely help his farm's bottom line in the coming year.

"Our other costs are going to be pretty well fixed also, so if we can maintain our production, get some production out of our cows, coming up [in] 2017 we should be in good shape," Doornink said.

As state and national milk production continue to reach record highs, Cropp said producers could see increased exports in the coming year as other producers like the European Union and New Zealand slow production.

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