Cheese traders create whiplash

Cheddar block jumped a dime last Thursday, climbing to $1.85 per pound, only to give back 11 cents Friday. By Lee Mielke.
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Cash cheese traders gave us a little whiplash to start February.
Cheddar block jumped a dime last Thursday, climbing to $1.85 per pound, only to give back 11 cents Friday, and close at $1.74, still 5 cents higher on the week and 27 cents above a year ago.
The barrels closed at $1.7075, up 26 cents on the week, 24 1/4-cents above a year ago, and re-established a more normal 3 1/4-cents below the blocks.
Three cars of block were sold on the week and 23 of barrel.
The blocks dropped 4 cents Monday, as traders awaited Tuesday morning’s Global Dairy Trade auction and, not liking what they saw, took the blocks down 7 cents Tuesday to $1.63.
The barrels inched up a quarter-cent Monday but lost a penny Tuesday, slipping to $1.70, an inverted 7 cents above the blocks.
After weeks of varying spot milk availability, Midwestern cheese producers reported readily available milk last week, says Dairy Market News, but less of it. Cheese demand is varied and the market undertone is uncertain as some contacts are taking a wait-and-see approach regarding international trade.
Spot butter closed the first Friday of February at $2.1575 per pound, down 6 1/4-cents on the week, 1 1/4-cents below a year ago, and the lowest price since December 15, 2016.
The butter was unchanged Monday and inched up a quarter-cent Tuesday to $2.16.
DMN says cream is still abundant in the Central region. January was fairly quiet but butter demand is steadily increasing as springtime holiday orders are starting.
Western butter output is steady but inventories are rising.
Spot Grade A nonfat dry milk closed three-quarter cents lower last week, at 94 cents per pound, but 23 cents above a year ago.
The powder was steady Monday but gained a penny Tuesday, hitting 95 cents per pound.
Politics is concerning the market. As per its campaign promises, the Trump administration is taking on the Mexican border issue and trade agreements deemed not advantageous to the U.S. Mexico is one of the U.S. biggest customers for powder.
GDT inches back
Tuesday’s Global Dairy Trade auction saw its weighted average for all products offered climb another 1.3 percent, after inching up 0.6 percent Jan. 17, which followed drops of 3.9 percent on Jan. 3 and 0.5 percent Dec. 20.
Buttermilk powder again led the declines, down 7.5 percent. Cheddar cheese was down 3.7 percent, after a 1.3 percent gain last time.
Butter was up 4.9 percent, after gaining 1.6 percent last time, and anhydrous milkfat was up 4.0 percent, following a 3.7 percent gain last time.
Whole milk powder was up 1.0 percent, following a 0.1 percent slip, and skim milk powder inched 0.1 percent higher, following a drop of 1.6 percent in the last event.
FC Stone equated the average GDT butter price to $2.0324 per pound U.S. CME butter closed Tuesday at $2.16 per pound. GDT cheddar cheese equated to about $1.7227 per pound U.S. and compares to Tuesday’s CME block cheddar at $1.63.
GDT skim milk powder was at $1.1830 per pound and whole milk powder averaged $1.5032 per pound U.S. CME Grade A nonfat dry milk price closed Tuesday at 95 cents per pound.
Dairy report
USDA’s Dairy Products report shows December cheese output totaled 1.05 billion pounds, up 3.0 percent from November and 1.3 percent above December 2015. Year to date production hit 12.1 billion pounds, up 2.0 percent from a year ago.
California produced 216.8 million pounds of that cheese, up 3.5 percent from November and virtually unchanged from a year ago. Wisconsin, at 271.3 million pounds, was up 1.8 percent from November but 0.7 percent below a year ago. Idaho was down 1.8 percent from a year ago while Minnesota was down 3.4 percent.
Churns spun 163.8 million pounds of butter, up 13.3 percent from November but 6.7 percent below a year ago, with YTD output at 1.9 billion pounds, up 2.2 percent.
California butter totaled 50.4 million pounds, up 19 percent from November but 2 percent below a year ago. New York output was up 77.7 percent from November and 5.9 percent above a year ago and Pennsylvania was up 3 percent from a year ago.
Nonfat dry milk production totaled 156 million pounds, up 21.8 percent from November, up 3.2 percent below a year ago, with YTD output at 1.8 billion pounds, down 4 percent. Skim milk powder production, at 51.6 million pounds, was up 18.7 percent from a year ago, with YTD output at 558.3 million pounds, up 25.1 percent from 2015.
December nonfat dry milk stocks stood at 228.4 million pounds, up 6 percent from November and 11.8 percent above a year ago.
 
Source: CapitalPress
Link: http://www.capitalpress.com/Dairy/20170207/cheese-traders-create-whiplash
 

Mirá También

Así lo expresó Domingo Possetto, secretario de la seccional Rafaela, quien además, afirmó que a los productores «habitualmente los ignoran los gobiernos». Además, reconoció la labor de los empresarios de las firmas locales y aseguró que están «esperanzados» con la negociación entre SanCor y Adecoagro.

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