Market News

A good week for butter and nonfat dry milk

More increased for butter and nonfat dry milk at the Chicago Mercantile Exchange on Friday. Butter gained a quarter-cent and NFDM added 3 cents. Cheddar cheese blocks slipped a half-cent and Class III futures were lower to reflect that.

For the week, cash cheese barrels gained 7 cents, blocks slipped a half-cent, butter increased 11.25 cents and nonfat dry milk increased 13 cents. Class III futures for September and October slipped 3 cents each, November gained a penny and March increased 29 cents.

Milk production is declining across the country, partially a seasonal thing and partly due to the hot, humid weather. Lower milk production and lower components are contributing to tight cream supplies which has some butter makers choosing to sell the cream rather than run it through the churns. Cheese factories seem to have enough milk but strong Class I demand in the Southeast is pulling loads from the Central and Mid-Atlantic States; Florida has imported 540 loads in the last three weeks.

The national weighted average advertised price for a half-gallon of organic milk in the United States was $4.49 last week compared to $1.58 for a half-gallon of conventional milk. That puts the organic-to-conventional spread at $2.91, the biggest spread of the year.

 

For months we have been watching as dairy farmers in Europe have been marching in protest over farm milk prices which are below the cost of production. However, European milk production led by Ireland, Poland and the Netherlands is above year-ago levels.

Milk production is also above last year in Australia and slightly above year-ago levels in New Zealand as their production year is just getting underway.

 

With calf prices where they are, this is no big surprise. The Turlock Journal reports 21 calves were stolen from their hutches on a Hilmar, California dairy farm last weekend. The Jersey-Holstein cross calves were between two days and eight weeks old. Officials are watching auction barns and other possible outlets in case the thieves try to sell the animals. Top-quality dairy heifer calves are worth up to $600 each these days.