Dairy economist forecasts 23% price drop due to COVID-19


By Mark Dorenkamp, Brownfield 

March 18, 2020


A dairy economist forecasts a more than 20 percent price drop because of COVID-19.


Nate Donnay with INTL-FCStone says he’s basing that off expenditures at grocery stores versus food service.


“And if we’re looking at something like a 40 percent decline in sales at restaurants for a three-month period, I think that would knock about three and-a-half percent off of total dairy demand in calendar 2020.”


He tells Brownfield that calculates to about a 23 percent reduction in dairy prices.


“So, we’re talking about farm-gate milk prices maybe being around $18-per hundredweight without coronavirus. Now with coronavirus, we’re talking about farm-gate prices down around $14 cwt.”


Because of the revised price outlook, Donnay expects…


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