Is a Milk Rally Coming?

By: Bryan Doherty

Strong prices for beef, due to a 50-year low supply of beef cattle, has encouraged dairy producers to breed cows and heifers to produce beef calves. The math is simple. Higher prices for beef calves compared to dairy calves is encouraging producers to follow the money trail for a better return.

Ultimately, this will likely increase prices for dairy products due to a contracting herd. Heifer prices will likely climb. For now, they face an uphill battle. Sluggish dairy exports and slow cheese demand in the past six months have contributed to the current weak environment for dairy products.