Milk Prices > Predicted Mailbox Prices (Wisconsin)

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Predicted Data

Month Class III Class IV Mailbox
Jun 2014 21.36 23.13 23.01
Jul 2014 21.60 23.78 23.17
Aug 2014 22.18 23.30 23.56
Sep 2014 22.85 22.39 23.96
Oct 2014 21.46 21.10 23.45
Nov 2014 20.01 19.33 21.93
Dec 2014 19.21 17.86 21.00
Jan 2015 18.45 17.53 20.12
Feb 2015 18.08 17.37 19.78
Mar 2015 18.01 17.45 19.74
Apr 2015 18.03 17.73 19.29
May 2015 18.03 17.55 19.26
Jun 2015 18.10 17.48 19.30
Jul 2015 18.05 17.01 19.02

The Mailbox Price was regressed on the Class III and Class IV price from 2001-01-01 to 2014-05-01. Then, the Mailbox price is predicted using the formula:

Mailbox Price = 1.886 + 0.831 (Class III Price) + 0.177 (Class IV Price) -0.194 (Q1) -0.714 (Q2) -0.869 (Q3)

where Q1, Q2 and Q3 are 0 or 1 according as whether the price pertains to quarters 1, 2 or 3. For the Class III and Class IV prices, we use the Announced Class III Price and Announced Class IV Price until Jul 2014, and the Class III Futures Settle Price and Class IV Futures Settle Price henceforth.

Regression Statistics

R2 = 0.9878, Adjusted R2 = 0.9874.
  Intercept Class III Class IV Q1 Q2 Q3
Coefficient 1.886 0.831 0.177 -0.194 -0.714 -0.869
Standard Error 0.152 0.020 0.019 0.090 0.090 0.091