Dairy prices for 2022 are projected at an eight-year high, with supply adjustments and booming exports across a wide range of products shoring up farmer balance sheets that have struggled with volatility during the pandemic era, NMPF Chief Economist Peter Vitaliano says in an NMPF podcast released today.
Due to tight supplies “not only is the outlook for milk prices the best in eight years, but that’s also the case for the individual dairy products,” Vitaliano said. Peter Vitaliano. “The big question is, with milk prices this good and feed prices not going up as fast as they were last year, how long is that tightness going to continue? And how soon will it be before we see some expansion of milk production again?”
Vitaliano, who also writes NMPF’s monthly Dairy Market Report, also encouraged farmers to sign up for the Dairy Margin Coverage program, which has a deadline of Feb. 18 for 2022 assistance. “The futures markets look very good at the moment, but there are many months to go. The history of dairy farmers second-guessing the markets, even based on the futures, is not very good. And again, given how inexpensive coverage is, our recommendation continues to be you should sign up for the program.”
NMPF resources on the Dairy Margin Coverage Program can be found here.