Most dairy prices perk up in May
Dairy prices started May mixed. Block Cheddar closed Friday at $1.6650 per pound, up 4 1/2-cents on the week and 6 1/2-cents above a year ago when it jumped 12 cents. The barrels skyrocketed to $1.6025 last Tuesday, the highest price since Dec. 15, 2017, but finished Friday at $1.60, up 11 1/4-cents on the week and 15 cents above a year ago.
The blocks were up 2 3/4-cents Monday and gained a penny Tuesday, hitting $1.7025, the highest price since Nov. 15, 2017. The barrels gained 5 1/4-cents Monday but gave back a quarter-cent Tuesday, slipping to $1.65.
The cheese market tone remains uncertain, according to Dairy Market News, but Central sales activity is reported as “fair to up slightly.” Cheese production in the West remains active as milk availability is stronger. Demand is solid and “keeping market prices at higher levels,” but cheese demand from the international market is also good due to favorable U.S. prices.
Butter finished last week at $2.3525 per pound, down three-quarter cents, but 24 1/2-cents above a year ago, with 55 cars exchanging hands last week.
The butter dropped 2 3/4-cents Monday and lost 2 1/4-cents Tuesday, dipping to $2.3025, with 20 loads exchanging hands on the morning.
Butter interest is appealing, in both domestic and foreign markets. Some contacts report that higher freight costs to move cream out of the West are contributing to augmented butter production. Butter stocks are ample, says DMN. U.S. prices are competitive with international prices and export sales are “lively.”
Spot Grade A nonfat dry milk, after four previous weeks of gain, shot to 85 1/2-cents per pound last Monday, highest price since Sept. 1, 2017. But it closed Friday at 84 1/4-cents, unchanged on the week and a quarter-cent below a year ago.
The powder was up 1 3/4-cents Monday and stayed there Tuesday at 86 cents per pound.
Dry whey closed the week at 31 3/4-cents per pound, up three-quarter cents. It inched a quarter-cent higher Monday, to 32 cents per pound, and held there Tuesday.
The April Federal order Class III milk price was announced by the USDA at $14.47 per hundredweight, up 25 cents from March, 75 cents below April 2017 and the highest since December 2017, and 20 cents above California’s comparable Class 4b cheese milk price. It equates to $1.24 per gallon, down from $1.31 a year ago.
The four month Class III average stands at $14.02, down from $16.17 a year ago and compares to $13.72 in 2016.
Tuesday’s Class III futures settlements portend a May price at $15.28; June, $15.77; July, $16.14; and August at $16.46, with a $16.72 peak in October.
The April Class IV price is $13.48, up 44 cents from March, 53 cents below a year ago, but the highest Class IV since December 2017.
Its 2017 average stands at $13.13, down from $15.03 a year ago and compares to $13.06 in 2016.
California’s April Class 4b cheese milk price was announced by the California Department of Food and Agriculture at $14.27 per cwt., up 31 cents from March, 3 cents below a year ago, but the highest 4b price since November 2017.
The 4b average stands at $13.75, down from $14.97 a year ago and compares to $13.02 in 2016.
The 4a butter-powder milk price is $13.29, up 28 cents from March but 44 cents below a year ago.
Its four-month average, at $12.99, is down from $14.69 a year ago and compares to $12.87 in 2016.
Meanwhile, producers await official results of votes cast regarding the nation’s No. 1 milk producer becoming the 11th member of the Federal Milk Market Order system. The state’s three major dairy cooperatives announced that they voted to support the move on behalf of their members. The new order would likely be in place by Nov. 1, 2018.
Cheese output up
USDA’s latest Dairy Products report shows March cheese output at 1.1 billion pounds, up 11.6 percent from February and 2.7 percent above March 2017. That put First Quarter output at 3.2 billion pounds, up 2.9 percent from a year ago.
Italian cheese totaled 481.6 million pounds, up 12.9 percent from February and 2.5 percent above a year ago. Year to date Italian cheese is at 1.4 billion pounds, up 3.9 percent from a year ago. Mozzarella, at 371.5 million pounds, was up 2.8 percent, with YTD at 1.1 billion pounds, up 3.6 percent.
American type cheese production totaled 437.0 million pounds, up 10 percent from February and 1.7 percent above a year ago, with YTD at 1.3 billion pounds, up 1.1 percent. Cheddar output, the cheese traded at the CME, totaled 314.8 million pounds, up 7.3 percent from February but 2.7 percent below a year ago, with YTD Cheddar hitting 926.3 million pounds, down 1.7 percent.
Churns produced 185.6 million pounds of butter, up 9.1 percent from February and 4.8 percent above a year ago. YTD output is at 537.8 million pounds, up 4.2 percent.
Dry whey totaled 88 million pounds, up 1.5 percent, with YTD output at 267.9 million pounds, up 8.6 percent. Stocks totaled 74.7 million pounds, down 15.4 percent from February and 3.5 percent below those a year ago.
Nonfat dry milk production totaled 180.3 million pounds, up 14.2 percent from February and 12 percent above a year ago. YTD output stands at 498.4 million pounds, up 8.8 percent. Stocks slipped to 298 million pounds, down 400,000 pounds or 0.1 percent from February but 51.5 million pounds or 20.9 percent above a year ago. February stocks were revised 25.6 million pounds lower.
Skim milk powder production totaled 41 million pounds, up 8.8 percent from February but 22.2 percent below a year ago.