July 7, 2023: May DMC Margins and 2023 Projections

Further degradation of the Dairy Margin Coverage (DMC) margin continued through May. On June 30, the May DMC margin was announced as $4.83 per cwt. This represents a record low, falling 20 cents below the previous low of $5.03 per cwt set in August of 2021. Based on June 30 DMC projections, feed costs are expected to continue to decline while milk price is also expected to  continue to decline enough to offset feed prices to keep the DMC margin on a downward trajectory at least through July, before improving through the rest of the year. Unfortunately, feed prices  do not decline enough, or milk price does not improve enough, to get the DMC margin above the maximum $9.50 margin through the rest of the year. Read More