Friday, July 8, 2022

US Dairy Market News – Week to June 14, 2013

BUTTER: CME Grade AA closed at $1.5350. The CME weekly average for Grade AA is $1.5400 (-.0010).

BUTTER HIGHLIGHTS: Butter production varies across the country. Churn operators indicate cream is available and they are sending some cream through the churns. Bulk butter production currently outpaces print butter as retail demand is slow to develop. Cream demand from ice cream/soft serve accounts is higher this week and luring cream loads away from butter production in all regions. Overall butter production is lower for the week. A few plant operators are purposefully selling cream into those markets to rein in butter inventory buildup. Bulk butter markets are diverse. Market participants found West bulk butter clearing at 5 cents under, Central butter pricing is flat, and East butter sales garnered up to 8 cents over the market. CME Group activity for the week netted a one cent decrease to Grade AA butter. Three sales transactions were finalized during the week

CHEESE: CME Barrels closed at $1.7725 and 40# blocks at $1.7225. The CME weekly average for barrels is $1.7700 (+.0450) and blocks, $1.7360 (+.0045).

CHEESE HIGHLIGHTS: Cheese prices across the country are mixed this week. Process cheese was firmer, while cheddar blocks were lower. Swiss cheese wholesale prices increased following the release of Class III prices last week. Cheese production remains very active with additional Class I milk supplies finding their way to cheese manufacturers. While inventories are steady, buyers are looking to acquire product for Q3 in case summer production slows manufacturing. Cheese demand is felt to be increasing with signs of strength at the CME Group spot sales. Block prices showed steady activity with buyers looking to increase their inventory. Barrel sellers were harder to find with limited offerings. Barrels are again selling at a premium to blocks. At the CME Group, barrels closed at $1.7725 on Friday with blocks at $1.7225. Compared to last week’s close, barrels are up 1.25 cents and blocks are 2.5 cents lower.

FLUID MILK: Storms across much of the U.S. this week affected late planting schedules. Heat in the southern tier of states is stressing cows and production is beginning to show some signs of slowing down. Northern areas of the country were cooler. Delays in planting and late harvest of forages have processors worried about continued milk supplies. Class I usage levels are lower as schools end their sessions. Increased supplies of cream are finding good demand from Class II manufacturers as their production season nears its’ peak. Ice cream and soft serve products are finally showing expected demand. Cream prices are steady to firm with some churns taking advantage of higher cream demand to slow butter production.

DRY PRODUCTS: Nonfat dry milk prices are steady to higher. There is a firm undertone to the market. Export demand is good with SMP production limiting domestic NDM inventories. A large tender for export NDM is upcoming and the market is waiting for more information on amounts and pricing. Powder production is seasonally heavy, but supplies are being held confidently by manufacturers. Dry buttermilk prices are mixed. Production is slowing as more cream is going to Class II usage. Manufacturers are managing inventories to insure contract fulfillment. Whey prices are uneven with a mostly steady undertone. Cheese production is heavy and whey production is following suit. Inventories are adequate from both processors and brokers. Export demand is good with prices comparable to domestic prices. Whey protein concentrate 34% prices are mostly steady. High NDM prices are causing protein end users to look favorably at WPC 34%. Some resellers report tight available supplies. Lactose prices are unevenly steady with a firm undertone. International buyers are looking to acquire Q3 and Q4 coverage.

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