News

Dairy keeps steaming higher

Another strong day in the dairy markets on Tuesday, cash cheese barrels gained 1.75 cents and blocks added 2.25 cents on the Chicago Mercantile Exchange. A couple of unfilled bids setting the market. Nonfat dry milk continues to push higher as well, Grade A increased 2 cents per pound and Extra Grade gained 3 cents, one sale set the Grade A price while an unfilled bid set the Extra Grade Price. Class III futures for 2014 jumped, January increased 45 cents to $19.12, February up 25 cents to $18.35, March added 23 cents to close at $18.09 per hundredweight.

The export projections in Monday’s Livestock, Dairy and Poultry Outlook from USDA pushing the dairy markets on Tuesday. 2014 fats-basis exports are estimated at 10.8 billion pounds and skims-solids basis exports at 38.4 billion pounds. This comes on top of the fourth consecutive year of record dairy exports in 2013. Exports will take about 15.5 percent of the nation’s total milk production this year. We have seen strong butterfat exports to new customers like Ukraine, Morocco and Korea which may be an indication the Europeans can’t fill the orders. Cheese exports have increased to Mexico, Korea and even Australia this year with all indications they will increase again in 2014.

After a sizeable jump two weeks ago, overall prices nudged 0.2 percent higher at the Global Dairy Trade auction on Tuesday. Volume was down as Fonterra’s offerings reflected the low point in the production year down under as they move into summer. Individually everything but whole milk powder was up from the December 3rd sale. Whole milk powder was 1.5 percent lower, lactose did not trade, cheddar cheese was up 1 percent, skim milk powder increased 1.7 percent, butter milk powder up 2.2 percent, milk protein concentrated was 3.9 percent higher, anhydrous milk fat up 4.4 percent, rennet casein jumped 7.4 percent and butter was 7.9 percent higher.