March milk prices dip but futures show gains
The all-milk price (before check deductions) for milk shipped by Wisconsin dairy farmers in March is expected to average $19.40 per hundred. This is down by 30 cents from the February all-milk price.
Wisconsin's all-milk average price is 30 cents above the weighted national average for March.
Among other states, the March prices are projected at $17.70 per hundred in California, $18.10 in New Mexico, $19.30 in Texas, $19.70 in both Michigan and Minnesota, $20.10 in New York, and $20.80 in Pennsylvania.
The combination of the March all-milk price and prices for basic dairy feeds dropped the milk to feed price ratio to 1.47 for the month, down from 1.52 for February.
Prices used in the formula for a 16-percent protein ration were $7.18 per bushel for shelled corn (up by 14 cents), $14.60 per bushel for soybeans (down by 10 cents), and $218 per ton for dry alfalfa hay (up by $1).
The Class III milk cash price for March, which was announced late in the afternoon on Wednesday of this week, was likely to be just below $17 per hundred. But, based on the Class III milk futures through midday on Wednesday, that could be the lowest Class III cash price until mid-summer of 2014.
Gains in the dairy commodity spot market on Wednesday of this week for Cheddar cheese barrels, AA butter, and Grade A non-fat dry milk triggered increases of 27-40 cents per hundred in the Class III milk futures over a span of four months later this year.
On an unfilled bid to buy one carload, Cheddar barrels gained three cents per pound on Wednesday to close at $1.6425 per pound. There was an unfilled bid to buy two carloads of Cheddar blocks but the price held at $1.6925 per pound - the same as it was a week earlier.
The AA butter price gained 1.75 cents per pound in the spot market on Wednesday for a closing price of $1.65 as one carload was sold.
Bids were the order of the day in the non-fat dry milk spot market as an unfilled bid for one carload pushed the Grade A price up by one cent to $1.65 per pound (up by nine cents from a week earlier) while Grade Extra held at $1.56 as a bid was made but not filled for two carloads.
Before the announcement of the Class III milk cash price for March, a prior settle price of $16.95 per hundred was posted on the futures trading board.
Other futures prices at mid-day on Wednesday were $17.53 per hundred for April, $18.63 for May, and in the $19s per hundred for all months in 2013 from June through October.
The dry whey futures market continues to provide underlying support to the tune of more than $3 per hundred for the Class III milk price.
For all remaining months of 2013, the dry whey futures prices stood at between 57.25 and 60.5 cents per pound in trading on Wednesday.
On April 2, Cooperatives Working Together announced the receipt of a package of 28 bids from Dairy Farmers of America, Darigold Cooperative, United Dairymen of Arizona, the Michigan Milk Producers Association, and Upstate Niagara O-AT-KA.
The bids were for financial assistance on the export of 5.899 million pounds of Cheddar cheese and 1.636 million pounds of butter to buyers in Europe, Asia, North Africa, the Middle East, and Oceania. Deliveries are scheduled from April-December.