The start of July was not friendly to prices in the dairy market. Prices fell on Tuesday of this week for all commodities traded in the spot market on the Chicago Mercantile Exchange and in the futures markets.
Per hundred declines of 30-55 cents in the Class III milk futures for all months from August 2014 through April of 2015 in trading through the early afternoon on Tuesday, July 1 highlighted the sharp price setbacks.
Near their final day of trading, the June 2014 futures held at $21.33 per hundred while the July futures gained 1 cent to $21.26. From thereon, however, red ink was in evidence, dropping the futures into the $20s per hundred for August through November of 2014 and then to the low $18s per hundred by the middle part of 2015.
The spot market for AA butter jumped by 11 cents per pound to $2.50 on Monday, June 30 but then joined the price retreat the next day by losing 5 cents as seven carloads were sold and an offer to sell one carload was not covered. The brief $2.50 spot market price was the highest price in the past decade but well short of the record high of $2.81 per pound set in 1998.
A gradual decline continued early this week in the spot market for Cheddar cheese. Cheddar blocks lost 1.25-cent and Cheddar barrels fell by 2.75 cents on Tuesday to close at $1.9875 and $1.9825 per pound respectively. Eight carloads of blocks and one of barrels were sold during the morning trading session.
Non-fat dry milk joined the downturn in the spot market with a price drop of 1.25 cents on the sale of one carload for a closing price of $1.77 per pound. Red ink also appeared on the trading board for dry whey futures as the prices stood in a downward arc from 66 cents per pound for July to 51 cents for September of 2015.
On Tuesday of this week, Cooperatives Working Together (CWT) announced the receipt of a total of 20 bids from Dairy Farmers of America, Tillamook Creamery, and the Northwest Dairy Association (Darigold of Seattle) for financial assistance on the export of 7.839 million pounds of Cheddar cheese, 972,239 pounds of whole milk powder, and 110,231 pounds of 82 percent butter.
Deliveries are scheduled from July to December to countries in Oceania, Asia, North Africa, South America, and the Middle East.
For the first half of 2014, CWT accumulated 58.76 million pounds of cheese, 47.521 million pounds of butter, and 14.568 pounds of whole milk powder in its financially-assisted export program which sent dairy products to 41 countries on six continents. Those products accounted for 1.753 billion pounds of milk on a milkfat basis.