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June 2022 Class I base price sets another record high

Progressive Dairy Editor Dave Natzke Published on 18 May 2022

The Federal Milk Marketing Order (FMMO) advanced Class I base price set a new all-time record high in June at $25.87 per hundredweight (cwt). The June 2022 price is up 42 cents from May 2022 and $7.58 more than June 2021.

The six-month average 2022 Class I base is $23.32 per cwt, up $7.62 from the January-June 2021 average of $16.13 cwt and is the highest average for that period on record.

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Class I zone differentials are added to the base price of each FMMO principal pricing point to determine the actual Class I price in each FMMO. With those additions, June 2022 Class I prices will average approximately $28.69 per cwt across all FMMOs, ranging from a high of $31.27 per cwt in the Florida FMMO #6 to a low of $27.67 per cwt in the Upper Midwest FMMO #30.

In June, the newer Class I mover “average-of plus 74 cents” formula will help boost Class I prices paid to producers compared to the previous ”higher-of” formula.

The difference between the advanced Class III skim milk pricing factor ($15.04 per cwt) and the advanced Class IV skim milk pricing factor ($14.80 per cwt) declined from May to just 24 cents per cwt.

Based on Progressive Dairy calculations, the Class I mover calculated under the higher-of formula would have resulted in a Class I base price of $25.27 per cwt, 60 cents less than the price determined using the average-of plus 74 cents formula.  end mark

Dave Natzke
  • Dave Natzke

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