Al6-Lancaster Fanning, Saturday, April 7,2001 GRAIN, CATTLE. HOG, & MILK BFP FUTURES MARKETS Markets Courtesy of Chicago Board and Mercantile Exchange Closing Bids: Thursday, April 5,2001 Corn % nt ty°p e,v,r, 9 » ■ ■ 2131 214[209 1/4; 222|217 1/4 220J220 1/2 229 229 3/4,225 1/2 228 1/4 1 228 j 235 1/4 nj ; ouui OlSep OINov 221 01 Dec 239 1/2 240 1/2 235 02Mar 249 1/4 249 3/4 245 |o2May 256 256 252 023U1 261 1/4 261 1/4 ,02Sep 259 262 1/2 02Dec 03Dec 265 1 Month Opening Nigh 265 Soybeans Month [Opening | High i OlMay 438 439 1/2| __ 433| __ _, _ 444 444 1/2 1 443 1/2 1442 1/2 [ 443 443 437 l/2[ 442 j 1/2 438 1/2 432 l/4[ 436 435 3/4j 1/2 1/2 1/2 472 480 enirig Soybean Meal Month Opening High Lowj- Closing jSettteiNet Chg 154.1 154.5 152.0 154.0 OlMay 151.6 151.8 149.6! 151.3 ; OUul 149.8 150.0 147.91 149.1 OlAug OlSep 147.4 148.0 145.8 J. 46.7 146.2 146.3 144.3 145.5 OlOct 01 Dec 146.8 146.8 144.5 145.7 02Jan 146.9 146.9 145.0 145.7 02May 149.0 149.0 148.0 148.0 IfeM 150.0 150.0 MonthOpeningl Weekly Dairy Market Outlook Ken Bailey Penn State March 30,2001 Dairy Market Outlook For 2001 Milk Supply The market is showing signs of price strength because of a slowdown in the growth in the milk supply. Adjusted for an extra day for leap year in 2000, February 2001 milk production for 20 select dairy states was 11.2 billion pounds, down 0.9 percent. January revised milk produc tion, at 12.1 billion pounds, was down 1.6 percent. Production per cow in February for 20 select states averaged 1,440 pounds, down 66 pounds from a year ago. And, cow numbers for these states in February was 7.77 mil lion head, 10,000 head less than January 2001. The market is reflecting a tight milk supply. Buyers, com modity traders, and speculators are all betting that the milk 3/41 239 1/2 1238 3/4 1/2 249 {248 1/2 1/4 255 3/4 | 257 260 1/2 . 259 261 264 | 265 r 265 265 265 LOW supply will be tight this year and commodity prices will be much higher. That sentiment is re flected in the dairy futures prices at the Chicago Mercantile Exchange (CME). As of March 29, 2001, the CME futures mar kets is expecting the Class 111 price of milk will rise from $11.39 per CWT in March to $13.36 per CWT by September. Likewise, the CME is expecting the Class IV price to rise from $13.50 per cwt in March to $514.50 per CWT by September. These price increases represent significant changes relative to a year ago. The outlook is for cow num bers to decline slightly the first two quarters of the year and then level out by the fourth quarter at 9.165 million cows. Total cow numbers are expected to decline just 0.4 percent (see Table 1). Milk per cow is ex pected to decline the first quar ter of 2001, even with a year ago the second quarter, and then re bound the third and fourth quarters. For the year, milk per cow will be up 0.9 percent. This im- 212 {212 1/2T212 1/4; 262 1262 1/2 263 Closing 'I 438 437 1/4 [437 1/2 +2 1 443 442 ! 153.9 153.8 151.4 151.5 149.2. 149.3 146.71 145.5 145.7 145.7 Apr 01 6625 6720 6620 6702 JunOl 7240 7310 7230 7262 JulOl 6915 6940 6897 6910 Aug 01 6520 6545 6495 6497 Oct 01 5680 5700 5670 5680 Dec 01 5420 5455 5370 5395 Feb 02 5460 5497 5455.5497 Apr 02 5370 5400 5370 5400 Composite VolumeOpenjnt + l 0 i 04/04/01 9109 46507 + 4 I + 41 220 1/41 228 i 235 1/4 + 4 1 + 6] 2391 248 3/4| + 6> 255 3/4 + 6 260 1/2 + 6 262 1/4 1 + 21 -4i 263 1/2 265! ! Settle NetChl -10, + 4 + 10 Oats + 6 Month Opening 111 + 6 OlMay + 2 01J||i }ll3 3/4 114 1/4|112 1/2 113 3/4 113 1/2 113 3/4 *<®|s|ll6 1/2116 l/2|'114 3/4i 116 1161 joiS|i|l22 1/2! 122 3/41' 121. 122 122 l2B b 128 i + 1 -2 -3i -3 1 Supply Milk cows (thou) Milk per cow (lbs.) Milk production (mil lbs ) % change year ago Farm use (mil lbs ) Marketings (mil. lbs) Beg comm stocks (mil lbs ) 6,135 9.307 10,664 8,904 Imports (mil. lbs) 952 1,209 1,191 1,094 Total supply (mil. lbs.) 49,386 53,374 52,682 50,342 Utilization (mil lbs) Ending commercial stocks 9,307 10,664 8,904 6,863 USDA net removals 273 262 139 167 Commercial disappearance 39,806 42,448 43,639 43,312 % change year ago 40% 21% 2.8% 18% Milk Prices ($/cwt) Class 111 971 942 1052 932 Class IV 10 84 11 89 11 89 12.69 All-milk 11 90 12 03 12 70 12 73 ♦Forecast by Ken Bailey, March 30, 2001 Table 1. Milk Supply and Demand for 2000 and 2001 (milkfat basis) plies that the milk supply will be down sharply the first quarter and then stage a rebound by the third and fourth quarter. For the year the milk supply will grow just 0.5 percent for 2001. That compares with a growth rate of 3.0 percent in 2000 relative to the previous year. Demand And Ending Stocks Demand for dairy products is expected to be impacted by a Lean Hogs Daily Prices As ofThursday, 5 April Date 04/05/01 04/05/01 04/05/01 04/05/01 04/05/01 04/05/01 04/05/01 04/05/01 Live Cattle Daily Prices As of Thursday, 5 April Date 04/05/01 04/05/01 04/05/01 04/05/01 04/05/01 04/05/01 Apr 01 7960 7990 7960 7985 JunOl 7355 7380 7355 7370 Aug 01 7257 7285 7257 7277 Oct 01 7435 7445 7420 7430 Dec 01 7512 7532 7505 7512 Feb 02 7605 7610 7590 7597 04/05/01 Apr 02 7705 7710 7700 7710 +5 Composite Volume Open_lnt 04/04/01 18394 128253 Pork Bellies Daily Prices As of Date 04/05/01 May 01 9430 9517 9310 9377 -130 04/05/01 JulOl 9462 9550 9350 9430 -135 04/05/01 Aug 01 9340 9420 9200 9235 -182 04/05/01 Feb 02 0 8180 8180 8180 -15 04/05/01 Mar 02 0 8200 8200 8200 unch Composite Volume Openjnt 04/04/01 462 2991 High i Giotting * 111, 109 109 3/4 Q 1 Q 2 Q 3 Q 4 9,188 9,213 9,229 9,211 4,640 4,688 4,460 4,416 42,630 43,189 41,161 40,678 5 3% 28% 35% 06% 331 331 334 334 42,299 42,858 40,827 40,344 slowing U.S. economy. USDA has forecasted that the Gross Domestic Product (GDP), a measure of the strength of the U.S. economy, will grow just 2.2 percent in 2001. That compares with a growth rate of just over 5 percent in 2000. That will be offset by a slightly lower infla tion rate and lower interest rates. The question is, how will this outlook affect demand for milk and dairy products? Commercial disappearance of Open High Low Last Chge .. ®* rev ‘ & Volume 2915 3984 568 1051 389 186 14 Open High Low Last Chge y o j^^ 8461 6056 1786 1585 402 39 65 - Thursday, 5 April Open High Low Last Chge 2000 Annual 9,210 18,204 167,658 3.0% 1,330 166,328 6,135 4,446 176,909 6,863 9,030 841 0 169,205 40,642 2.6% 2 /% 9 74 10 56 11 83 12 76 12 34 13 28 (.inch Prev. Prev. Volume Open_lnt 323 1998 99 737 40 233 0 19 0 3 Settle Net Chg 110 -4 110 2001* Q 2 Q 3 9,180 4,556 41,825 -I 9% 9,170 9,165 4,711 4,572 43,201 41,899 0.0% 18% 16 16 43,185 41,883 41,809 6,863 1,000 49,672 9,030 9,875 1.000 1,000 53,215 52.758 9,875 8,203 0 0 43,340 44,555 2 1% 21% 12 20 13 27 14 36 14 45 14 81 15 34 dairy products (milkfat basis) in 2000 grew at an annual rate of 2.6 percent. With a slowing economy it is expected that growth in demand for dairy products will be just 2.1 percent in 2001. This represents a con servative estimate based on an uncertain economic outlook and a gloomy stock market. The impact of a dramatic slowdown in the growth of the U.S. milk supply coupled with (Turn to Page A 44) Prev. Open_lnt 9044 20919 4137 4694 4312 2874 450 77 Prev. Open_lnt 32569 40686 24574 19957 7972 1764 731 Unch -2 -4 1 Annual 9,165 4,538 41,587 9,170 18,376 168,512 0 5% 2 2% 64 168,448 41,571 8,203 1,000 50.774 6,863 4,000 179,311 6,552 6,552 44,221 2 1% 172.758 2 1% 12 60 14 08 14 83 12 16 1391 14 56
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