Reports from CoBank Knowledge Exchange focusing on the dairy industry.
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The U.S. Dollar Index saw rapid deflation in 2020 and has coincided with a rally in commodity prices.
The pandemic in 2020 caused unprecedented market volatility in dairy prices, leading to lower milk checks for dairy producers. However, the price spread is expected to realign in the first half of 2021, bringing normalcy to producer price differentials and mailbox milk prices.
The U.S. rural economy will continue to face headwinds in 2020 and is expected to underperform relative to the economy of urban America.
The U.S. economy is still performing well by most key measures. However, consumers, investors, companies and other market participants have become more wary about the near-term future with seemingly good reason.
U.S. cotton acreage will be up in 2018, but nowhere is that increase more transformative than in the Southwest. Kansas, Oklahoma, and Texas are projected to increase planted area by 40 percent, 16 percent, and 6 percent, respectively.
Unlike other agricultural commodities, the perishability of milk requires that it be processed almost immediately after being produced. Dairy processors are faced with the challenge of handling an ever-growing supply of milk, while anticipating the right product mix to meet consumer demand.
Organic milk has experienced significant growth despite having among the highest price premiums over its conventional (non-organic) counterpart. Milk had the highest sales of any certified organic commodity in 2015 at $1.174 billion and represents about 21 percent of all agricultural organic sales.
Industry consolidation on both the production and processing side has helped to even out but not eliminate some of the unbalanced market power that had previously been dominant in the industry.
A small but growing number of dairy producers are incorporating dairy genomics into their management decisions.
With domestic demand for dairy products likely to remain flat for the foreseeable future, exports will provide the biggest opportunity for U.S. dairy producers over the next several years, especially in Asia, Africa and Latin America.
The latest Veterinary Feed Directive (VFD) Final Rule was issued in June 2015 by the Food and Drug Administration in response to the public perception that the use of antibiotics in animal feed may be leading to antibiotic resistance.
The current global glut of milk powder, as reflected in the large and growing inventories held in the U.S., the EU, and New Zealand, has kept world milk powder prices depressed, with little hope of a meaningful recovery until at least 2017.
In 2016, U.S. dairy margins are being slugged with a 1-2 punch of soft milk prices and slashed cattle prices.