Dairy keeps slipping

No change in the cash cheese markets on Friday but a busy day for butter, the price fell 3.5 cents on 12 sales and 10 unfilled bids.

For the week cash cheese barrels gained 3.5 cents, blocks held steady and butter lost a nickel. Butter under pressure from strong cream supplies, heavy churning schedules and building inventories; Compared to a year ago, butter production was up 6.4 percent in March and year-to-date production is up 9 percent. Demand is described as fair but buyers are always hesitant when prices are going down. Increasing interest in ice cream makers is taking some cream away from the churns.

Milk production remains strong across the United States, the southeast is past peak and heat and humidity are starting to be a factor. Dairy Market News reports northern states are still approaching peak as pastures green-up. Western states are dealing with excess production and milk is being moved to find processing capacity.

The national weighted average advertised price for organic milk half-gallons is $3.87, up 31 cents from two weeks ago. Non-organic half-gallons averaged $1.41 putting the price spread at $2.46; two weeks ago it was $1.47.

Increasing production and decreasing exports are pushing European milk prices lower. LTO-Netherlands reports EU prices fell 3.3 percent in March to 33.72 Euros per 100 kilograms. That works out to $20.14 per hundredweight, down from $19.65 in February but still $1.28 above March of last year.

The United Nations Food and Agriculture Organization projects a 2.7 percent increase in global milk production this year on top of a 2.3 percent increase last year.

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