In its September WASDE report, the USDA milk production forecast for 2021 was reduced from the prior month, reflecting a smaller dairy herd and lower average yields per cow. Milk output is still expected to increase 2.1% YOY to 103.3bn kgs in 2021 – that would follow a 2.2% increase in 2020. Milk production in 2022 is now forecast 1.2% higher YOY (down from the 1.4% YOY rise forecast in August).

All-milk prices for 2021 were increased to 35.7c/l (up from 35.3c/l in August), reflecting lower milk supplies and improving demand which lifted NFDM, cheese and butter prices while dry whey was unchanged. Average all-milk prices for next year were also increased to 36.2c/l (up from 35.1c/l in the prior month).

The September 2021/22 US corn outlook was for larger supplies, increased feed and residual use, greater exports and higher ending stocks. The report was generally labelled as “bearish” for grains, with supplies better-than-expected given favourable weather conditions in the US and other major producing regions.

Other WASDE highlights included the forecast that China’s record corn crop – expected to be 5% higher than last year – won’t prevent another record year for imports in the 2021-22 year, expected to total 26m tonnes, on a par with the 2020-21 marketing year.