Dairy product market moves into quiet period
Trading volume was relatively high in the spot market on the Chicago Mercantile Exchange on Monday and Tuesday of this week but there was minimal activity on Wednesday.
Five carloads of Cheddar cheese barrels were sold on both Monday and Tuesday, four carloads of AA butter were sold on Tuesday, and an offer to sell one carload of Cheddar blocks dropped the price by 4.25 cents per pound on Tuesday.
On Wednesday of this week, the only activity in the CME spot market was uncovered offers of one carload each of Cheddar blocks and barrels and Grades A and Extra of non-fat dry milk.
Block and barrel prices held at $1.4925 and $1.4525 per pound, respectively and the AA butter price remained at $1.30 per pound.
As a result of the offers, the spot market price fell by .50-cent per pound for both grades of non-fat dry milk on Wednesday. This dropped the price to $1.1225 per pound for Grade A and $1.0825 for Grade Extra.
With little influence from commodity prices, the Class III milk futures prices for the remainder of the year posted only minor up and down changes on Wednesday and trader interest for contracts in 2013 was minimal.
Near the end of the trading session, the futures stood at $15.13 per hundred for May, $14.35 for both June and July, $14.78 for August, and in the lower $15s for the latter months of 2012.
Prices for the third quarter of the year were down by an average of 50 cents per hundred from a week earlier.
For May, the Class I fluid milk base price is $15.85 per hundred. This is an increase of 19 cents from April.
Within the coming week, there will be reports on the milk production for April and on the producer price differential for milk pooled during April in Federal Milk Marketing Order 30.
A package of 10 bids was submitted to Cooperatives Working Together by Dairy Farmers of America, Darigold, United Dairymen of Arizona, and the Maryland and Virginia Milk Producers Cooperatives.
The bids were for price assistance on the export of 749,572 pounds of Cheddar and Monterey Jack cheeses and 518,086 pounds of butter to countries in North Africa, the Middle East, and Asia from May to July.