Summer Could Tough for Dairy and Corn Industry; New Beef Cycle is Developing

Summer could prove tough for the dairy industry according to Mike North of Commodity Management Group. North says that as of March “more milk equals more product more product equals bigger inventories bigger inventories equals smaller prices” and he believes this will be the cycle into summer. US dairies had 10,000 more cows in February indicating herd expansion is underway at some locations.

Ag Web reports that corn could hit $3.20 with no summer drought. If a summer drought fails to happen corn values could fall into the $3.20 range while soy beans could drop as much as a $1.50. Values for both crops are likely to fall heading into the June after as the markets correct after compensating for the lower than expected South American Crop.

Finally Beef Magazine declares that a new cattle cycle is developing through 2016 and 2017. The 2005 through 2015 cycle was a 10 year. Food and Agricultural Policy Research Institute projects the next cattle cycle to be approximately ten years in length.