#Dairy product market starts New Year on a very high note

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Some of the highest spot market prices ever for Cheddar cheese were on the trading board on Wednesday of this week as a result of single unfilled bids to buy one carload each of 40-pound blocks and 500-pound barrels on the Chicago Mercantile Exchange.
 
Those bids raised the block price by 9 cents per pound to $2.20 while the barrel price was lifted by 10 cents to $2.16. Those aree respective increases of 20 and 31 cents per pound in the new calendar year.
 
As three carload sales were made, bringing the total for the week to seven, and a bid for two carloads was not filled, the AA butter spot market price reached $1.65 per pound on Wednesday. That is an increase of 11.75 cents since the start of 2014.
 
The non-fat dry milk spot market was active for Grade A this week with nine carloads sold through Wednesday. Three of the sales were on that day as the price tacked on .25-cent per pound to close at $2.0825. A bid for one carload was not filled. The Grade Extra price remained at $2.09 per pound.
 
December prices
 
Slight increases in the Class III milk cash price and in the national weighted all-milk average price for December 2013 were reported during the past week. The Class III price of $18.95 per hundred was the highest for any month in 2013 — 12 cents above the November price and the second highest ever for a December.
 
The expected all-milk price for December is $21.80 per hundred — 20 cents more than in November. In Wisconsin, the all-milk price for December is $21.90 per hundred — 10 cents more than in November. For all of 2013, the all-milk price averaged $19.95 per hundred — $1.45 more than in 2012.
 
In other milk use classes, the official December prices were $20.37 per hundred for Class I, $21.66 for Class II, and $21.54 for Class IV. The January 2014 base price for Class I fluid milk is $21.38 per hundred — an increase of $1.11 from December.
 
Projected all-milk prices in other top milk production states for December include $20.50 per hundred for both California and New Mexico, $20.70 for Idaho, $21.90 for Michigan, $22.10 for Minnesota, $22.40 for Texas, $22.80 for New York, and $23.20 for Pennsylvania, which continues to have an in-state premium for milk used in Class I.
 
Lots of butterfat
 
Unusually high butterfat averages boosted the December all-milk prices, which are based on 3.5 percent butterfat. For the month, Minnesota’s milk had an average of 4.04 percent butterfat. Percentages in other states included 3.99 in Texas (Jerseys are a relatively high percentage of the milking herd), 3.94 in Idaho, 3.9 in New York, 3.89 in Wisconsin, and 3.88 in California.
 
The theoretical milk price to feed cost ratio of 2.3 calculated for December is the highest since October of 2010, when it was 2.4. It is based on the month’s all-milk price and the costs of feedstuffs for a 16-percent protein dairy ration.
 
Prices used for the December ratio are $21.80 per hundred for the average weighted all-milk price, $4.31 per bushel for shelled corn (down 4 cents from November), $13 for a bushel of soybeans (up by 30 cents), and $187 per ton for dry baled alfalfa hay (down $1).
 
The December Class III milk cash price boosted the monthly average for 2013 to $17.99 per hundred. This is the third highest average ever, trailing only the Class III average prices of $18.37 for 2011 and $18.04 for 2007.
 
Futures markets
 
In trading on Wednesday, the Class III milk futures markets moved into green ink territory for all months through March of 2015 but not to the extent of the day’s increase in the spot market price for Cheddar cheese. The greatest increases were 60 and 52 cents per hundred respectively for February and March of 2015. Most of the monthly increase for 2014 were between 20 and 27 cents per hundred.
 
The gains in the futures market put the Wednesday afternoon trading prices at $20.39 per hundred for January, $20.50 for February, $19.50 for March, and in the $18s and upper half of the $17s per hundred for the remaining months of 2014.
 
With very little market activity on Wednesday, the dry whey futures prices stood at between 60 and 56.3 cents per pound for all months in 2014. Every one cent of the dry whey price provides a value of about six cents per hundred on the Class III milk price.
 
Export statistics
 
In late December, Cooperatives Working Together announced the receipt of a total of eight bids from Bongard’s Creamery of Minnesota, the Maryland and Virginia Milk Producers Cooperative, and Tillamook Creamery of Oregon for financial assistance on the export of 5.936 million pounds of butter and 914,919 pounds of Cheddar cheese to countries in Europe, North Africa, and the Middle East. Deliveries were scheduled to June of 2014.
 
Those bids brought the 2013 total of the subsidized exports to 130.324 million pounds of cheese, 97.58 million pounds of butter, 218,258 pounds of whole milk powder, and 44,092 pounds of anhydrous milk fat — the equivalent of 3.4 billion pounds of milk on a milk fat basis. This program is run by the National Milk Producers Federation and supported by voluntary milk checkoffs of 2 cents per hundred.
 
Source: Journal Sentinel

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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