Domestic commercial use of milk in all products continued to strengthen during the August–October period, providing some support for prices even as production is increasing as well. U.S. milk production has increased year-over-year each month from July through October, at generally diminishing rates, while U.S. dairy cow numbers have increased steadily relative to a year earlier, indicating potentially greater increases in milk production in upcoming months.
Meanwhile, total U.S. dairy exports have exceeded the equivalent of 18 percent of U.S. milk solids each month since February this year, keeping the industry on track to surpass last year’s current record of 17.3 percentby this measure. Milk prices this year will set a new record for an entire calendar year, projected at to be at least $25.50 per cwt, well above 2014’s record of $24.00 per cwt. The Dairy Margin Coverage program margin may dip back below $9.50 per cwt in December and likely will remain below that level well into 2023.