Prices for manufactured dairy products in the spot market on the Chicago Mercantile Exchange continued on a downward slope through Wednesday of this week. Nearby month Class III milk futures prices also tumbled within the past week.
The AA butter spot market led the way on Wednesday as the price fell by another 4 cents per pound to close at $1.4275 - the lowest price since February of 2012.
One carload sale and an offer to sell one carload made up the day's market session.
Cheddar cheese followed suit on Wednesday with 1.75 and 1-cent per pound declines respectively for barrels and blocks, putting their closing prices at $1.64 and $1.6775 per pound.
Three carloads of blocks were sold and an offer to sell one carload was not covered during the day's session.
In a quiet non-fat dry milk spot market, the prices stood at $1.73 per pound for Grade and $1.70 for Grade Extra.
Dry whey futures prices, which have shown a bit of weakness recently, were in a tight range of 56-57.75 cents per pound for the remaining months of 2013 before falling to an average of 50 cents per pound for the first half of 2014.
The most striking price change during the week ending on Wednesday was the plunge in Class III milk futures for July and August.
The 7-cent cutback for July by mid-day on Wednesday put the month's trading price at $17.03 per hundred - down by 97 cents from a week earlier.
Wednesday's mid-day August trading price of $17.61 per hundred was down by 87 cents per hundred from a week earlier.
Later months of 2013 were holding in the low $18s per hundred while the lower $17s prevailed for the first half of 2014.
Cooperatives Working Together has received a batch of 10 bids from Dairy Farmers of America and Darigold Cooperative of Seattle.
The bids were for financial assistance on the export of 3.439 million pounds of Cheddar, Gouda, and Monterey Jack cheese to countries in Asia, North Africa, and the Middle East on deliveries scheduled from June through October.
This program is supported by a voluntary checkoff of 4 cents per hundred of milk (up from 2 cents as of July) by members of cooperatives who are part of the National Milk Producers Federation.
Federal Milk Income Loss Contract (MILC) payments have resumed to dairy farmers who still have eligibility (up to 2.985 million pounds of milk) for the 2013 fiscal year.
Those amounts were 11.8 cents per hundred for January, 52.22 cents for February, 75.46 cents for March, and 69.88 cents for April. Those payments were triggered by the high costs of feed.
University of Wisconsin-Madison dairy economist Brian Gould has calculated a potential payment of 69.79 cents per hundred to eligible producers for the milk they shipped in May.
For several subsequent months, however, he doesn't expect any MILC payments because of the combination of slightly lower feed prices and higher milk prices - a factor that might have changed because of the sharp declines in Class III milk futures this week. Gould runs the calculations on Fridays.