According to University of Minnesota Extension Economist Marin Bozic, the milk check has been hurt by the coronavirus pandemic. “Looking at recent charts of Class III milk prices, there were highs a few months ago of $18 per hundredweight. Now, the most decent price is around $12.84 per hundredweight,” said Bozic. “Just as farmers were coming off five years of misery, we got hit by the virus in the most vicious way.” Foodservice demand for U.S. dairy products is down. Not all of that demand is gone, but no one is stepping forward with new demand either. Bozic said it’s important to set a price floor for milk so farmers don’t find themselves in a situation where low prices hurt even more. “Set the floor on part of the milk, wait a little bit and if prices recover, set another floor. If the markets don’t recover, pull the trigger anyway,” said Bozic. “Now is the time to take protection for 2021. By all means, be optimistic and hope for the global recovery, but farmers shouldn’t be their farms on that.”
Subscribe to RRFN
Get a weekly digest from RRFN to stay up-to-date on all the latest news in agriculture.