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Milk futures lower, cash dairy mixed

Class III milk futures at the Chicago Mercantile Exchange took back a chunk of the previous session’s gains. June was $.09 lower at $16.51, July was $.21 lower at $17.04, August was down $.18 at $17.40, and September was $.13 lower at $17.44.

Cash cheese blocks up $.0125 at $1.7325. Two loads were sold, one at $1.72 and one at $1.7325. The last uncovered offer was for one load at $1.7325. Barrels were down $.04 at $1.48. Eight loads were sold, including three at $1.5125 and two at $1.52. The last uncovered offer was for one load at $1.48.

Butter was $.02 lower at $2.36. Four loads were sold, one at $2.36. The last unfilled bid was on one load at $2.36. The last uncovered offer was for one load at $2.3725.

Nonfat dry milk was down $.0025 at $.9275. The last unfilled bid was on one load at $.925. The last uncovered offer was for one load at $.9275.

The USDA says milk production over the past week varied, depending on region. Central states reportedly edged higher and the Northeast and Mid-Atlantic saw record butterfat and total volume of milk receipts. Class I demand was steady to lower with bottling demand dwindling ahead of Memorial Day and school closings. Midwestern Class III demand was up thanks to better block cheddar prices, with prices $3 to $5 lower than Class. Retail demand is getting better, especially for processed cheese, thanks to increased demand for grilling needs. The USDA says contacts in the Northeast and West say export interest for U.S. cheese is improving because of competitive prices. Cream is readily available to make butter, with churns in the Central region remaining active. Some manufacturers in other parts of the U.S. have stopped outright to sell excess cream. Inventories are steady to higher, retail orders are moderate to strong with mixed consumer demand. At the retail level, conventional dairy ads were up 43%, while organic ads were down 12%. The spread between organic and conventional half gallons of milk is $1.35, in favor of organic.

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