Bob Cropp Dairy Specialist University of Wisconsin The BFP prices on the futures market have declined significantly in recent trading sessions. On December 15, while the December BFP settled at $17.25, other near month con tracts declined. January BFP contracts settled at $15.60, down $0.73 form the $16.33 on December 10. February con tracts at $13.40 were down $1.23 from $14.60 on December 10th. And March contracts at $12.66 were down $0.86 from $13.52 on December 10th. More distant contracts also declined but to a lesser degree. On December 15th the May BFP broke the $12.00 barrier and settled at $11.91. June contracts settled at $12.01. A December BFP over $17.00 and a new BFP record seems quite safe. The 40 pound block cheddar cheese price has increased every week since September 1 and ended at a record $1.90 per pound on Friday, December 11. The 40 pound block price is the prime driver of the BFP. But why the BUY, SELL, TRADE OR RENT THROUGH THE CLASSIFIED ADS IN Lancaster Farming PHONE 717-626-1164 OR 717-394-3047 FAX 717-733-6058 « =^ ==! '- :: Qbt i == :::ci ==* Mon., Tues., Wed., Fri. 8 AM to 5 PM Thurs. 7 AM to 5 PM sateagffpj-tdßfifti drop in BFP prices after December? The answer is an anticipation of increased milk production and resulting cheese production along with a season al decline in cheese sales. Cheese sales have been excel lent with increases of more than 2%. October 31st stocks of nat ural American cheese were down 5.8% from September and 5.3% from a year ago. But a rebuild ing of cheese stocks are antici pated as milk production and milk composition improves sea sonally and sales decline season ally. But we can't forget super bowl Sunday which is a strong cheese sales period. Nevertheless, cheese prices have not only increased beyond pre dictions, they have held longer than many anticipated. Cheese production did show some strength in recent weeks. October production of American cheese was up 1.4% from a year ago and the production of all cheese up 2.4%. USDA's November milk production report does not show milk pro duction strengthening. While milk production compared to a year ago was down in July .jtii kiry Frw Stall - Dairy Situation And Outlook jar-span truss arch design in widths up to 160 feat, ;ed to any length for maximum space use. Exclusive DURAWEAVE™ cover with bright white interior and 15 YEAR WARRANTY. ■ Gatorshield* triple-coated corrosion barrier steel framework for long service life. ■ Custom end enclosures and doors available. Keystone Farm Show Section 1, Lancaster Farming, Saturday, January 2, 1999—Page (0.8%) and August (-0.5%), it return to a slight increase in September (-0.3%), and increased 1.7% in October, but increased 3.0% for November. Why the change in milk produc tion? First, milk cow numbers have stopped declining. For the 20 reporting states, milk cow numbers are unchanged from October and down just slightly, - 0.1% from a year ago. But more importantly, milk per cow has returned to a more normal increase, being up 2.8% from a year ago. Compared to a year ago, milk per cow was down in July ,and August 0.6% and 0.5% respectively, increased just 0.4% in September and 1.8% in October. The major change here was for California which has been experiencing rather poor milk production per cow due weather related problems for most of the year. But for November, California's milk per cow was still down, but only 1.5% compared to 3.1% for October and close .to 7% for September. Weather has improved and California's milk per cow is slowly improving. Since California had 3.8% more / V ' , V 1 i cows this more than offset the decline in milk per cow and resulted in a 2.3% increase in California's milk production compared to just a 0.6% increase in October and lower milk pro duction during the summer months. Mild weather has been a fac tor across the country for improved milk production per cow. Also a milk-feed rice ratio of 4.23 compared to 2.73 a year ago encourages grain and concen trate feeding for milk produc tion. The only states showing less milk per cow in November compared to a year ago were Virginia, Washington and California. November milk production, compared to a year ago, for other states show the following increases; Arizona 6.3%, Idaho 10.6%, Washington 4.1%, New Mexico 8.8%, New York 3.5%, Pennsylvania 0.8%, Ohio 0.6%, Wisconsin 3.8% and Minnesota 4.1%. Milk cow numbers have stopped declining in Wisconsin as well. November cow numbers were up 2,000 head from October and down only 1.2% from a year ago. Milk per cow m Iff tm ft nr-Mi auutuntt * was up 5.2% in Wisconsin and 6.9% in Minnesota. Texas had been experiencing poor milk per cow also because of adverse weather. But for November, milk per cow as up 3.4% offsetting 3.4% fewer milk cows, and resulting in no change in milk production. All spring and sum mer Texas's milk production had been running below year ago levels. Milk production, although up seasonally, contin ues below year ago levels in most southern states and in the southeast. Kentucky for exam ple, had 7.3% less milk and Florida experienced a 2.7% decline. But since milk produc tion is up seasonally, the need to bring outside milk into the region for fluid purposes has pretty much stopped. In summary, 1998 will finish with a new record BFP in December of more than $17.00. While the BFP will decline as we more into 1999, the BFP will stay well above the 5 year aver age, at least through April, and perhaps longer. ’ ifir JOUMMOinu vH, v r \ * * n 83 &
Significant historical Pennsylvania newspapers