July
25, 2008 Commodity Markets: CME and California Plants
Estimated Producer CWT. Prices
June Pool Recap
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July 25, 2008
Butter
3 sales, 4 bids unfilled, 2 offers uncovered. Butter recovered 1 cent for the week after a 2-cent loss the prior week. After several sessions that were steady or down, the cash butter price ticked up mid week. Churning is active on seasonally declining cream volumes. Butter producers are anticipating lower availability for needs in the short term. Domestic interest has been steady, which, combined with international interest, has caused handlers to dip into inventory to fill orders. The CME weekly inventory report shows a drop of 6.4 million pounds from the prior week. This is the earliest on record for a drop of this magnitude.
Cheese
7 sales, 5 bids unfilled, 0 offers uncovered. Cheese gained 6.75 cents this week following a 6.75-cent gain last week. The cheese market is unsettled. Blocks strengthened throughout the week, leaving barrels with a declining price until midweek when barrels came charging back to end unchanged. The action in blocks has encouraged some buyers to begin replenishing depleted supplies. Cheese production is often lower, reflecting declines in milk receipts.
Milk Production
Fluid volumes are steady to lower throughout the country, except in California where cooler temperatures have returned and milk levels have rebounded. With schools reopening in a few weeks in the Southeast, fluid demand in that region will pick up.
Dry Products
Dry product price trends are generally unchanged. Western whey has seen an improved balance between supply and demand. The nonfat dry market is mostly steady. Export activity has continued to clear product, and production is easing seasonally at many plants.
Source: USDA Dairy Market News
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