future.aae.wisc Class III below support Jan-Oct ′09 WI Mailbox: $12.14

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http://future.aae.wisc.edu

Class III below support

Jan-Oct ′09 WI Mailbox: $12.14

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Federal Order Reform

$1.13 Support Price

$1.72

$1.09

Imputed Cheddar Values From Futures Prices

Mar ′10: $1.48 Apr ′10: $1.46 May ′10: $1.48

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Cheddar, Butter NFDM Dry Whey

2009

Whey FMMO Make Allowance: 19.91¢

Dry Whey (4/21/07): 79.33¢

2009

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IOFC for cow producing 65 lbs/day

$/cow/day

IOFC = Income Over Feed Costs

Ration (lb/d) Corn: 22.2 SBM: 2.52 Hay: 25.5

With MILC Payments

Average

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000 Herds Mil. Lbs

Number of Farms Aug 2003: 16,264 Jan 2010: 12,929

Wisconsin Milk Production

Wisconsin Licensed Dairy Herds

Annual Y-O-Y Changes WI CA Cows: +0.32% -4.13% Prod: +3.25% -3.85%

Yield growth > cow # Cow # growth > yield

Dec ′09: 252,000 less U.S. cows than Dec ′08

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Wisconsin: 4.3% ↑ Over Dec ′08 California: 4.7% ↓ From Dec ′08

2009: -0.11% ↓ from 2008

1st Drop Since ′04

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Dec '09: 8.5% ↑ over '05-'08 avg.

1st Drop since Nov. ′08 Dec '09: 29.0% ↓ from Dec. '08

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Dec '09: 12.4% ↑ over Dec. '08

Nov '09: -40.1% from Nov. '08

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Source: USDA, Foreign Agricultural Service

Exports = Imports

1998-2006 Average Quarterly Deficit: $117 Mil 2007-3rd Qrt 2008 Average Quarterly Surplus: $268 Mil

Qrt 2, 2008: $481 Mil

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Source: USDA, Foreign Agricultural Service

Average % NFDM: 38.3 Whey: 39.1 Butter: 3.6 Cheese: 1.8

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Data as of Feb. 5th

$/cwt

Based on Feb. 5th Class III futures settle prices Average Mailbox

2007: $19.00 2008: $18.63 2009: $12.21 2009*:$12.85

Avg Predicted Mailbox: $15.91 Avg. Futures Settles: $14.67

Basis = $1.24

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Correlation between these two series is 0.659

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$/cwt $/bu

Data as of Feb. 5th

Class III ↑ relative to grain prices after April

$/cow/day Ration (lb/d) Corn: 22.2 SBM: 2.52 Hay: 25.5 Jan. ′00 – Oct ′09: $6.82

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% YOY Change Prod. Com. Dis. 2009: -0.37% -0.63% 2010: -0.21% +2.59%

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