Market News

Milk futures, cash dairy steady to higher

In Class III trade at the Chicago Mercantile Exchange, milk futures were steady to up, watching the weather and the cash markets. July was unchanged $15.27, August was $.27 higher at $16.72, September was up $.19 at $16.68, and October was $.14 higher at $16.63.

Over in the spot market, cash cheese was higher. Blocks were up $.0425 at $1.7075. There were two trades, one at $1.68 and one at $1.70. The last unfilled bid was on one load at $1.7075. Barrels were $.02 higher at $1.775. There were a total of twelve trades, including six at $1.755 and three at $1.775.

Butter was unchanged at $2.2975. The last unfilled bid was on two loads at $2.28.

Nonfat dry milk was $.005 higher at $.845. There were a total of seven trades reported, one at the closing price. The unfilled bid was on one load at $.845. The last uncovered offer was for one load at $.85.

The USDA says cheese stocks at the end of June 2016 were a new record high for the month, up 10% on the year, at 1.25 billion pounds. Butter stocks jumped 27% to 326 million pounds.

For the week ending July 22nd, the USDA says butter production was active across the U.S. However, some processors are selling cream due to high multiples and while cream supplies are called tight, there’s enough to make butter. The market undertone is called firm with strong retailer demand and mixed inventories.

Cheese vats are described as full with some Midwestern manufacturers looking for spot loads to compensate for lower milk intakes. Demand is high in the Midwest and Western regions. Fresh cheese barrels are becoming scarcer in the West, while Midwestern inventories are mixed.

Fluid milk production is moving lower, along seasonal lines, because of higher temperatures. Midwestern spot loads are called harder to find as temperatures rise.

Conventional dairy ads were down 5% over the past week and organic ads were up 37%. The price spread for a half gallon of organic and conventional milk was $2.49, up $.44 on the week.