Let s get real! Dairy farmers deserve new pricing formula
Arden Tewksbury
Time is running out for our family-sized dairy farms! However, the Federal Milk Marketing Improvement Act is now resurfacing once again, and the authors, myself and Gerald Carlin, have made some favorable changes in the bill.
For the first time, dairy cooperatives are going to have to pay the same basic formula price to their members as the proprietary handlers have to pay.
No longer will a so-called make allowance be deducted from the basic formula price which has always lowered the price to all dairy farmers.
All buying handlers will take possession of the milk once the milk is pumped into a tanker.
Press release content from Globe Newswire. The AP news staff was not involved in its creation.
Mailbox Milk Prices Expected to Normalize in 2021 Following Year of Extreme Volatility
CoBankDecember 21, 2020 GMT
DENVER, Dec. 21, 2020 (GLOBE NEWSWIRE) 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 (PPDs) and mailbox milk prices, according to a new report from CoBank’s Knowledge Exchange division.
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Extreme volatility in cheese and milk prices resulted from supply chain disruptions, government purchasing, and changes in consumption habits during the COVID-19 pandemic. Record-high cheese prices lifted Class III milk prices disproportionately higher than Class IV milk prices, which were held in check by low butter and milk powder prices.
2021 Milk Price Outlook: Throw the Crystal Ball Out the Window agweb.com - get the latest breaking news, showbiz & celebrity photos, sport news & rumours, viral videos and top stories from agweb.com Daily Mail and Mail on Sunday newspapers.
John Newton
The price of Class III milk (milk used to produce cheese) rose to near-record highs in 2020 on the back of increased cheese demand, tighter cheese supplies and USDA’s Farmers to Families Food Box Program. Meanwhile, the price of Class IV milk (milk used to produce butter and dry milk powders) remained at multi-year lows due to COVID-19-related market disruptions and price volatility.
As a result, the difference between the Class III milk price and other prices of milk rose to record-highs. In June, 2020, the Class III milk price was more than $9.60 per hundredweight higher than the base Class I milk price. Similarly, in July, the price difference between Class III and IV rose to nearly $11 per hundredweight.