Milk Prices Near Bottom for 2023

Milk prices are expected to start rising again by the end of June and should peak at $20.50 per cwt by the end of summer, according to economist Dan Basse, President of AgResources Co. 

Basse believes milk prices are near a seasonal low for 2023 and by the end of June, prices will start heading up again. Class III milk price is currently around $16.40 per cwt. He noted the U.S. dairy export volume has been close to last year, but exports of butter, whey and skim are all down.

“We are actually importing more butter [primarily Irish butter] than we are exporting, but global cheese demand and exports of cheese are high,” Basse said. “However, from a dollar value perspective, exports have been down because prices are down. We need to turn this around as we get into summer so we can change the landscape and get milk prices above $21 per cwt by late summer. Ice cream sales should also come into play.”

Domestically, he noted, butter demand this year has been “very, very good in the U.S.” Demand for cheese in the U.S. has been at record levels. Basse predicts the Class III milk price will reach a high of between $20 and $20.50 per cwt by the end of summer.

EDITOR’S TAKE:

If Dan Basse’s predictions are accurate, this will be very good news for dairy farmers. Milk prices are seasonal, but are also impacted by all the other factors Basse mentioned. That said, it appears that the dairy industry is positioned for a pretty good year when all is said and done in 2023. Hopefully, that can inspire all our CAD members who have dairy in their backyards to reach out now and cultivate that relationship that could very well lead to a truck sale or two later on. You might even entice them into your dealership for a special in your parts or service departments. Make sure you have some milk and cookies available.