News

A down week for dairy

For the second time in the week, cash cheese declined on the Chicago Mercantile Exchange on Friday. Barrels down 7.5 cents to $1.835, blocks fell 7 cents to $1.92. Class III futures declined in response to the cheese market. Butter and nonfat dry milk held steady.

For the week, cash cheese barrels down 24.5 cents, blocks lost 19 cents, butter gained a quarter-cent and Grade A nonfat dry milk gained a half-cent. Class III futures November declined 22 cents, December is down 91 cents, January is 53 cents lower, February fell $1.34 while the May contract is 2 cents lower than a week ago.

So cash cheese dropping below $2.00 during the week, traders were not surprised by the drop however, buyers are a bit reluctant to jump in when prices are going down. No exact numbers yet but cheese and dairy product sales in the Northeast are certainly going to be hurt by the on-going transportation problems and lack of electricity from Hurricane Sandy and the Nor’easter.

Packaged fluid milk sales in the U.S. in September totaled 4.3 billion pounds, 5.2 percent less than total sales in September of 2011. Adjusting for the calendar composition sales were 1.5 percent lower than a year ago. Total conventional milk sales were down 5.2 percent while organic fluid milk sales decreased 4.5 percent from a year ago.

The monthly World Agricultural Supply and Demand Estimates from USDA on Friday nudged projected milk production for 2012 a little higher to 199.7 billion pounds citing a little more production per cow. The 2013 production estimate unchanged from last month at 199.7 billion.

Projected cheese prices unchanged from last month for both this year and next but butter prices were reduced 1 to 1.5 cents reflecting the lower cash prices.

Class III milk price estimate for 2012 unchanged from last month, $17.55 to $17.65. the 2013 estimate a dime higher at $17.85 to $18.75. Class IV for 2012 reduced a nickel at $15.95 to $16.15 while the 2013 price estimate was increased 15 cents at $16.90 to $17.90. The all milk price estimate for 2012 unchanged from last month $18.50 to $18.60 while the 2013 estimate was raised a dime $19.10 to $19.20 per hundredweight.

Read the full WASDE report here:

Add Comment

Your email address will not be published.


 

Stay Up to Date

Subscribe for our newsletter today and receive relevant news straight to your inbox!