Dairy market news at a glance (April 26-30)

Click here for the complete USDA Dairy Market News for April 26-20

BUTTER: Grade AA closed at $1.7525. The weekly average for Grade AA is $1.7860 (-0.0080).

CHEESE: Barrels closed at $1.8350 and 40# blocks at $1.8000. The weekly average for barrels is $1.8110 (+0.0205) and blocks, $1.8010 (+0.0085).

NONFAT DRY MILK: Grade A closed at $1.3250. The weekly average for Grade A is $1.3110 (+0.0690).

DRY WHEY: Extra grade dry whey closed at $0.6600. The weekly average for dry whey is $0.6630 (-0.0050).

CHEESE HIGHLIGHTS: Cheesemakers continue to report a bountiful, flush-level milk supply. Spot milk prices in the Midwest ranged from $5 under Class to flat Class this week. Price points at $.50 over Class from last week were not reported. Food service sales maintained strength when compared to most of the past year, however demand has begun to level off as a number of customers have recently refilled pipelines. Retail cheese demand reports are mixed. Eastern retail sales are hearty. Midwestern demand reports vary, but some producers say buyers are hesitant to add to their growing inventories in case of a market shift down. Cheese inventories remain mixed. Barrels are generally noted as tighter, but blocks are more available depending on variety. Despite the atypical barrel-over-block price scheme on the CME, market tones are generally steady at this point.

BUTTER HIGHLIGHTS: Cream is reported to be a little tighter than last week. Butter production rates are stable to lower, with churn operations following typical seasonal patterns. Inventories are balanced in Central and Western coolers but growing in the East. Some contacts share that retail and food service orders are trending steady to lower overall, although there is some slight variation in demand between regions. Across the country, bulk prices range from 1.0 to 8.0 cents above the market this week.

FLUID MILK: Milk production is varied across the regions, this week, with high output reported in the Southeast, Midwest, and generally throughout the West. Production is steady in the Northeast. Output is in a slow decline in Florida. Regardless, there is plenty of milk available across the country for processing operations. Class I demand is steady to higher nationwide, however some Midwestern contacts have reported a concern with limited bottling demand in the near future. Contacts report that condensed skim discounts are scarce to non-existent. Tanker delays related to driver shortages are a growing problem throughout all regions. Cream multiples are generally similar to last week, despite reports of a slightly tightening availability.

DRY PRODUCTS: Across all regions low/medium and high heat nonfat dry milk (NDM) prices increased this week. Global demand is putting a strain on domestic production/supply. Dry buttermilk prices shifted higher at the bottom of the range in the Central and East, while prices in the West also moved up at the bottom of the range and both sides of the mostly price series. Domestic demand for dry buttermilk has lessened in recent weeks, but international demand remains strong. The gap between international and domestic dry whole milk prices is closing as domestic prices continue to increase. National dry whey prices are steady to higher. Demand has slowed as higher prices have made purchasers hesitant. WPC 34% prices are steady to higher. Supplies are short for WPC 34% that is needed for specific purposes, particularly infant formula manufacturing. Lactose prices are steady as production is keeping pace with demand. Contacts are concerned that potential impediments, such as African swine fever or freight/port constraints, could abruptly shift currently healthy market prices. Acid and rennet casein prices held steady on the shortened week. 

JANUARY MAILBOX PRICES (FMMO): In January 2021, mailbox milk prices for selected reporting areas in Federal milk orders averaged $16.12 per cwt, down $1.22 from the December 2020 average and down $2.75 per cwt from the January 2020 average. The component tests of producer milk in January 2021 were: butterfat, 4.06%; protein, 3.26%; and other solids, 5.77%.

MARCH MILK MARKET UTILIZATION (FMMO): During March, 11.0 billion pounds of milk were received from Federally pooled producers. This volume of milk is 18.4 percent lower than the March 2020 volume. Regulated handlers pooled 3.7 billion pounds of producer milk as Class I products, down 6.8 percent when compared to the previous year. The all-market average Class utilization percentages were: Class I = 34%, Class II = 17%, Class III = 14%, and Class IV = 35%. The weighted average statistical uniform price was $15.89 per cwt, $0.77 higher than last month but $1.13 lower than last year.

APRIL RETAIL MILK PRICE (FMMO): U.S. simple average prices are: $3.58 per gallon for conventional whole milk, $3.55 per gallon for conventional reduced fat 2% milk, $4.09 per half gallon organic whole milk, and $4.09 per half gallon organic reduced fat 2% milk.