Economist encouraged by milk prices
The Chief Economist for the National Milk Producers Federation is encouraged by milk price trends. Peter Vitaliano says milk prices are at an eight-year high, and booming exports across a wide range of products are shoring up farmer balance sheets that struggled with volatility during the pandemic. Vitaliano says those prices were helped by a very sharp drop-off in milk production and cow numbers since May. He says the U.S. has gone from around four and a half percent expansion to negative growth seven months later.
Although prices appear good now, Vitaliano still encourages producers to sign up for the Dairy Margin Coverage program. He says the history of dairy farmers second-guessing the markets is not very good, even when based on the futures market. Vitaliano says given how inexpensive the coverage is, he recommends farmers keep signing up for the program.
The DMC paid out more than 1.1 billion dollars in benefits during 2021.