Milk Prices Are Expected To Dip, Following Record Year For Producers

Dairy economists are expecting a decline in milk prices — a downward trend that comes after a year of record-high prices.

2014 has been a great year for milk producers throughout the state. Strong demand domestically and abroad, as well as falling feed prices, has helped keep prices high and balance sheets in the black. But the honeymoon may be over: Mark Stephenson, the director of dairy policy analysis at University of Wisconsin-Madison, expects milk prices to drop.

“This difference between milk and feed prices is a marketplace that is telling dairy producers, ‘We want more of your product — we want more milk.’ And dairy producers are responding to that, and as we get more milk we will probably overshoot the needs of the marketplace,” he said.

Stephenson said he expects 2015 to be a much more normal year in terms of milk prices. The concern now, he said, is whether milk production slows down enough to make 2016 another normal year.