For the first time in 2014, Cheddar cheese prices in the spot market on the Chicago Mercantile Exchange have fallen to below $2 per pound.
That happened on Tuesday of this week. A quiet market day followed on Wednesday with prices holding at $1.9975 per pound for Cheddar blocks and $1.96 for Cheddar barrels.
After hitting a high for the year earlier this week, the AA butter spot market price fell by 1.5 cents per pound to $2.16 on Wednesday. The day’s market activity was the sale of four carloads, bringing the week’s total to six.
The Grade A non-fat dry milk spot market session on Wednesday had one carload sale, putting the week’s total at six. An offer to sell two carloads was not covered and the price remained at $1.78 per pound.
Futures markets
Futures prices for dry whey increased for most remaining months of 2014 on Wednesday. This put the prices at 67.7 cents per pound for May, 60 cents for September, and at 48.5 cents per pound or above for all subsequent months through December of 2015.
Despite no support from the spot market commodities prices, the Class III milk futures posted gains for most months of 2014 on Wednesday. Prices for nearby months were lower than they were a week ago while those for latter months of the year were a bit higher.
In afternoon trading on Wednesday, Class III futures prices were steady at $22.65 per hundred for May, up by 24 cents to $20.94 for June, up by 13 cents to $20.30 for July, $20.12 for August, $20 for September, and above $18 per hundred for all subsequent months through May of 2015.
Those futures prices, if they convert to cash values in the upcoming months, would set record high milk prices for both May and June, thereby extending the run of record high monthly milk prices to six.
In its most recent forecast, the U.S. Department of Agriculture is projecting the nation’s milk production to top 206 billion pounds this year and 212 billion pounds in 2015 — increases of 2.4 and 2.9 percent from the previous year. It predicted average all-milk prices of a record $22.70 to $23 per hundred for 2014 before a drop to between $19.70 and $20.70 for 2015.
Export update
Cooperatives Working Together (CWT) has announced the receipt of a batch of 11 bids for financial assistance on the export of 1.166 million pounds of Cheddar cheese, 1.047 million pounds of whole milk powder, and 551,156 pounds of 82 percent butter to countries in Asia, Africa, Central America, South America, and the Middle East on deliveries scheduled from May to November.
Those bids were submitted by Dairy Farmers of America, Foremost Farms USA, Northwest Dairy Association (Darigold), Tillamook Creamery Cooperative, and the Michigan Milk Producers Association.
For calendar year 2014, the CWT export bid totals have reached 51.535 million pounds of cheese, 42.467 million pounds of butter, and 8.856 million pounds of whole milk powder — the equivalent of 1.492 billion pounds of milk on a milkfat basis. Deliveries were headed to 35 different countries on six continents.
Source: Wisconsin State Farmer
