Bigger Milk Crop Than Expected

WASHINGTON - Mar 10/06 - SNS -- Forecast U.S. domestic milk production in 2006 is raised from last month as January output was larger than expected, believes the USDA's World Agricultural Outlook Board.

Commercial use is to remain relatively firm but the increase in production and higher-than-expected beginning stocks are expected to result in lower forecast prices and increased commercial ending stocks.

The cheese price is forecast lower than last month, which will more than offset slightly stronger whey prices and result in a reduced Class III price. Both butter and nonfat dry milk prices are forecast lower than last month, and the Class IV price forecast is lowered to reflect this.

CCC net removals of nonfat dry milk are raised slightly from last month. The forecast all milk price for 2006 is lowered to $12.75 to $13.35 per cwt.

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