Market News

Milk futures mostly higher

In Class III trade at the Chicago Mercantile Exchange, milk futures were mixed, mostly higher on spread trade and short covering. May was unchanged at $12.87 and June was down $.09 at $12.92, while July was up $.01 at $13.34 and August was $.08 higher at $14.00.

In the spot market, cash cheese barrels were down $.015 at $1.30. The last bid unfilled was on one load at $1.29. The last offer uncovered was for one load at $1.30. Blocks held at $1.305 with one load sold. The last bid unfilled was on one load at $1.29. The last offer uncovered was for one load at $1.3075.

Butter was unchanged at $2.05. The last bid unfilled was on two loads at that price. The last offer uncovered was for one load at $2.08.

Nonfat dry milk was up $.0025 at $.7775. There were two loads sold, one at the closing price and one at $.78. The last bid unfilled was on one load at $.775. The last offer uncovered was for two loads at $.78.

The USDA says that butter production is strong in the Northeastern and Western regions, but Central region production is steady to lower with some additional cream headed to Class II processing. Butter supplies are rising. The Eastern region is seeing better interest from retailers and food service, while food service demand in the Central areas is steady, but retail demand is slack.

Cheese production is very active. Some Midwestern producers did report some inventory reduction this week with an increase in sales, but others say demand is slowing as buyers wait to see if prices decline. Western stocks are building with steady demand and shrinking storage space.

Fluid milk production was up in most of the U.S., but high temperatures have reduced output in Arizona, California, and Florida. Butterfat component levels are declining around the country. Manufacturing milk volumes are called heavy and bottled milk orders vary depending on location.

Conventional dairy ads were up 40% over the past week and organic ads were 11% higher. The largest ad volume for conventional dairy was 48 to 64 ounce containers of ice cream, 4 to 6 ounce containers of Greek yogurt, and 8 ounce packs of shred cheese. Ads for one pound packages of butter were 57% higher. Conventional yogurt ads were up 21% and organic was 64% higher. The price spread between organic and conventional half gallons of milk is $2.40.