Dairy Economics in 2004

After more than two years of overall depressed milk prices, there is a brighter light on the horizon for dairy producers. September Class III milk futures closed at $15.69 on March 5. The February Class III price of$11.89 is the highest February price since 1998. The graph on the next page shows the current futures projections for 2004 compared to the Class III price for the last two years. It shows prices averaging more than $4 per cwt. higher than 2003 over the next 5 to 6 months