Nation's milk prices for June could be lowest of the year
Although the Class III milk price for June, which was announced yesterday (July 5), was likely about 40 cents per hundred higher than May's price, the national all-milk average for June dipped slightly from the May price, according to a report early this week by the National Agricultural Statistics Service.
The anticipated national average all-milk price for June is $16.10 per hundred, down by 10 cents from the May price. Most of this difference could be traced to the average butterfat test of 3.58 percent compared to 3.63 percent for May.
June's all-milk prices in Wisconsin and several other leading milk production states, however, are running contrary to the national trend. The predicted average all-milk price for June in Wisconsin is $17.10 per hundred, up by 10 cents from May, although average butterfat slipped to 3.60 percent compared to 3.66 percent in May.
In other states, the anticipated all-milk increases from May to June are 30 cents per hundred (to $16.10) in Idaho, 19 cents (to $14.70) in California, and 10 cents (to $17.40) in Minnesota. All-milk prices for June in other states included $17.40 per hundred in Pennsylvania, $16.80 in New York, $16.30 in Michigan, and $16 in Texas.
On Tuesday of this week, which was the final day of trading for the June Class III milk futures, the closing price was $15.62 per hundred. This was 39 cents more than the official Class III price for May.
Class III price boosts of $1 to $2 per hundred are on the horizon for upcoming months, if the current futures are a reliable indicator.
Closing prices on Tuesday were $16.65 per hundred for July, $17.28 for August, $17.60 for September, $17.58 for October, $17.38 for November, and $17.15 for December. Prices then drop into the upper half of the $16s per hundred for most months in 2013.
Steady prices prevailed in the Chicago Mercantile Exchange's dairy commodity spot markets on Tuesday as activity was minimal heading into the July 4th trading holiday. One uncovered offer each for a carload of Cheddar block and barrel cheese left the day's prices at $1.64 and $1.6750 per pound, respectively.
Three carloads of AA butter were sold in the spot market on Tuesday as the price remained at $1.5275 per pound.
Non-fat dry milk prices held at $1.2275 per pound for Grade A and $1.1950 for Grade Extra.
Futures prices for dry whey traded between 50.5-54 cents per pound for all remaining months of 2012 on Tuesday. Then they drop into the 40s and high 30s per pound for all months of 2013.
In round numbers, the federal Milk Income Loss Contract (MILC) payment for May was $1.22 per hundred, following the $1.21 for April.
According to the calculations on June 29 by University of Wisconsin-Madison dairy economist Brian Gould, the projected payments are $1.30 per hundred for June, $1 for July, and 24 cents for August.
Under pending federal dairy legislation, MILC payments will terminate after August.
Cooperatives Working Together has accepted a batch of 14 requests from Agri-Mark Cooperative, Bongards Creamery, Foremost Farms, Darigold Cooperative and Dairy Farmers of America for price assistance on the exporting of 2.191 million pounds of Cheddar and Monterey Jack cheeses to countries in North Africa, Pacific Asia, Central America and the Middle East. Deliveries are scheduled from July through October.