Dairy traders had a lot of information to assimilate last week and took CME block Cheddar to a $1.56 per pound Friday, closing the week 2 1/2-cents higher but 2 1/2-cents below a year ago. The barrels finished at $1.4925, up an impressive 12 3/4-cents on the week but 6 3/4-cents below a year ago.

Monday’s cheese was unchanged as traders anticipated Tuesday morning’s Global Dairy Trade auction and Tuesday afternoon’s February Milk Production report.

The blocks jumped 2 1/4-cents Tuesday, to $1.5825, and the barrels were up 1 3/4-cents, hitting $1.51, highest since Sept. 10, and reduced the spread to 7 1/4-cents.

Midwestern cheesemakers continue to report seasonally quiet orders, according to Dairy Market News, and some expect the lull to continue through the month. Contacts relay that their milk suppliers, smaller dairy farms, experienced barn collapses due to excess snow buildup. Cows on those farms were being relocated but milk remains available.

Western cheese production is active as parts of the region have increasing milk output. Inventories are heavy. Demand is strong from domestic retail and a few export channels.

Cash butter closed Friday at $2.28 per pound, up 1 1/4-cents on the week and 7 cents above a year ago.

The butter was up a half-cent Monday and gave it back Tuesday.

Midwest churns remain very active and cream continues to roll in, including additional loads from the West. Butter inventories are building.

Western cream supplies are solid but not overbearing. Cream items production for the upcoming holiday is picking up.

Grade A nonfat dry milk closed Friday at 96 3/4-cents per pound, down three quarter-cents on the week but 27 3/4-cents above a year ago.

The powder was unchanged Monday and backed down a half-cent Tuesday, to 96 1/4-cents per pound.

The now one year old spot dry whey market closed last week at 32 cents per pound, down 2 cents on the week but 2 3/4-cents above a year ago.

Monday’s whey dropped 2 cents and inched back up a half-cent Tuesday, to 30 1/2-cents per pound.

February milk up

Continued gains in milk per cow nudged February milk production slightly above February 2018. Preliminary USDA data in the top 23 producing states shows output at 16.0 billion pounds, up 0.6% from 2018 but that compares to a 1.3 gain in January.

Output in the 50-state total was at 17.0 billion pounds, up just 0.2%.

Revisions reduced the initial 23-state January estimate by 7 million pounds, putting it at 17.5 billion pounds, up 1.3% from 2018.

February cow numbers in the 50 states totaled 9.36 million head, unchanged from January but down 77,000 from a year ago, eighth time that cow numbers were below a year ago since May 2016.

Output per cow averaged 1,818 pounds, up 19 pounds from February 2018 and the 40th consecutive month of gain.

California output was up just 0.1% from a year ago, thanks to a 10-pound gain per cow outweighing 8,000 fewer cows. Wisconsin was up 1.5% on a 35-pound gain per cow but cow numbers were down 5,000 head.

Idaho was up 2.1%, thanks to 8,000 more cows and a 15-pound gain per cow. New York was up 2.8%, on a 45-pound gain per cow and 2,000 more cows. Pennsylvania was down for the 12th consecutive month, dropping 6.0% on 25,000 fewer cows and 20 pounds less per cow.

Minnesota was up 1.6%, on a 45-pound gain per cow offsetting 5,000 fewer cows.

Michigan was up 1.0% on a 35-pound gain per cow offsetting 3,000 fewer cows. New Mexico was down 3.9%, on a 5-pound drop per cow and 12,000 fewer cows milked. Texas posted a 7.7% gain on the books, thanks to 70 pounds more per cow and 20,000 more cows milked.

Vermont was up 1.0%, on a 40-pound per cow increase offsetting 2,000 fewer cows milked. Florida was down 6.2% on 8,000 fewer cows though output per cow was up 5 pounds.

Washington state was unchanged despite a 20-pound drop per cow where uncharacteristically bitter cold weather and winds took a huge toll on dairies. Cow numbers were down 3,000 from a year ago.

GDT up 1.9%

Tuesday’s Global Dairy Trade auction saw gain for the eighth consecutive session. The weighted average of products offered was up 1.9%, following the 3.3% jump on March 5. Sellers brought 47.9 million pounds of product to the market, down from 52.8 million on March 5 and the smallest total since June 19.

The gains were led by rennet casein, up 9.7%, followed by butter, up 9.3%, after a 3.7% rise last time. Whole milk powder was up 4%, following a 6% jump, and GDT Cheddar cheese was up 3.9%, after a 6% boost last time.

Declines were led by anhydrous milkfat, down 3.1%, after gaining 3.9% last time. Skim milk powder was down 3.9%, after dipping 4.3%, and lactose was off 1.0%.

FC Stone equates the GDT 80% butterfat butter price to $2.3085 per pound U.S., up 24.8 cents from the last session. CME butter closed Tuesday at $2.28. GDT Cheddar cheese equated to $1.8306 per pound, up 6.7 cents from the last event, and compares to Tuesday’s CME block Cheddar at $1.5825. GDT skim milk powder averaged $1.0908 per pound, down from $1.1165 last time.

Whole milk powder averaged $1.5046, up from $1.4452 last time. CME Grade A nonfat dry milk closed Tuesday at 96 1/4-cents per pound.

More butter

The USDA’s latest Dairy Products report shows January cheese output totaled 1.1 billion pounds, up 0.7% from December and just 0.4% above January 2018.

Italian cheese totaled 480.7 million pounds, up 0.3% from December but 1.3% above a year ago. Mozzarella, at 379.3 million pounds, was up 3.3% from a year ago.

American type cheese totaled 438.7 million pounds, up 3.2% from December and 1.2% above a year ago.

Cheddar, the cheese traded at the CME, totaled 322.6 million pounds, up 15.7 million pounds or 5.1% from December and 4.3 million or 1.4% above a year ago.

U.S. butter churns gave us 189.9 million pounds of butter, up 17.9 million pounds or 10.4% from November and 7.7 million pounds or 4.2% above a year ago.

Yogurt output hit 384.1 million pounds, up 5.1% from a year ago.

Dry whey totaled 81.2 million pounds, down 10.1%. Dry whey for human consumption totaled 79.7 million pounds, up 8.9% from December but 9.5% below a year ago. Stocks totaled 78.7 million pounds, up 20.8% from December but 11.6% below those a year ago.

Nonfat dry milk production totaled 172.7 million pounds, up 21% from December and 7.7 percent above a year ago. Stocks climbed to 283.6 million pounds, up 8.9 million pounds or 3.2% from December but are 23.4 million pounds or 7.6% below the 2018 level.

Skim milk powder totaled 30.4 million pounds, down 40.1% from December and 33.5% below a year ago.

Sales down

U.S. fluid milk sales continue to slide but the latest slippage was below 1%. The Agriculture Department’s data puts January sales at 4.2 billion pounds, down just 0.6% from January 2018, following a 2.1% drop in December.

Conventional product sales totaled 3.97 billion pounds, down 0.5% from a year ago. Organic products, at 233 million pounds, were down 1.3% and represented about 5.5% of total sales for the month.

Whole milk sales totaled 1.35 billion pounds, up 2.6% from a year ago and made up 32.1% of total fluid sales in the month. Skim milk sales, at 312 million pounds, were down 9.2% made up just 7.4% of total milk sales for the month.

Columnist Lee Mielke wraps up the week’s dairy industry news.

Recommended for you