Reduced Milk Output in United States

WASHINGTON - Jan 11/08 - SNS -- Forecasts for 2008 U.S. milk production are lowered as higher forecast feed prices are expected to limit growth in cow numbers and gains in milk per cow, according to forecast from the USDA's World Agricultural Outlook Board.

The milk production forecast for 2007 is increased slightly as milk per cow in the fourth quarter continues to recover from weakness earlier in the year. Ending stocks for 2007 on a fat basis are unchanged from last month, but skim solids stocks are raised because nonfat dry milk (NDM) stocks have remained higher than expected.

For 2008, the Class III price forecast is unchanged from last month. Cheese prices are forecast fractionally higher as demand for cheese is expected to be firm. The Class IV price for 2008 is forecast lower. The price forecasts for butter and NDM are reduced as inventories of those products are large. The all milk price forecast for 2008 is lowered slightly to $17.90 to $18.70 per cwt. The 2007 all milk price is estimated at $19.15.

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