03/03/06 Economist sees low dairy prices in `06

University of Idaho economist Wilson Gray says milk production grew in Idaho and nationally but he expects to see some leveling off later this year. Idaho cow numbers were up 8 and a half percent last year and milk production was up 10.3 percent from the previous year. Add in big butter and cheese stocks says Gray and you're probably going to see 2006 milk prices that will fall below the five year average of 12.87. 83 percent of Idaho dairy producers are participating in the Cooperatives Working Together program where for the past couple of years a nickel assessment was used for herd buyout and export improvement. Knowing that demand isn't keeping up with supply Idaho Dairymen's Association executive director Bob Nearebout says the CWT Board meets next Monday to talk about a new assessment. NEARABOUT "Do we increase it and I think the answer will come out of that room 'yes.' And then it's going to be how much do we increase it? Do we go a nickel and bring it to ten cents per hundredweight or do we go a dime and bring it to 15 cents per hundredweight? Gray does expect to see that expansion slowing this year but a longer-term challenge will likely be escalating feed prices. In the end Gray predicts for 'a year or more of very difficult milk prices.' Voice of Idaho Agriculture Bill Scott