Market News

Cheese and butter move higher

Cash cheese and butter moved higher on the Chicago Mercantile Exchange on Friday with Class III futures responding accordingly.

For the week, cash cheese barrels gained 2.5 cents, blocks are steady, butter increased 7.25 cents and nonfat dry milk is unchanged. Class III futures for March and April added 3 cents, May increased 34 cents and September is 15 cents above a week ago.

While we saw some nice increases in cheese and butter on Friday, overall the markets are moving within a range. That is prompting some buyers to build inventories at these prices.  Easter and Passover orders have shipped however cream demand is picking-up as ice cream makers are getting to work.

A few more details from Ag Market News regarding the unusual decline in organic milk product sales in January. Total sales were down 5.3 percent compared to January of 2014, a rare occurrence.  Ag Market News says organic whole milk sales were up 10.3 percent but organic reduced fat milk sales in January were 12.2 percent below a year ago.  The average advertised price of a half-gallon of organic milk is $3.99 up 11 cents from a week ago.  Organic gallons increased 69 cents to average $6.09.

New Zealand dairies are looking to take advantage of the shortage or organic milk in the United States. One cooperative is raising the price it pays for organic milk by $1.50 per kilogram of milk solids effective June 1.  That is a significant premium given Fonterra just announced the average pay price for conventional milk this year will be $4.90 to $5 per kilogram.