Milk futures prices bunched in the $16s
Spurred by by several trading sessions with price gains last week, the Cheddar cheese prices on the spot market at the Chicago Mercantile Exchange this week stood at their highest point since November of 2014.
After posting a total increase of 10.5 cents last week, Cheddar cheese barrels held at $1.88 per pound through Wednesday of this week. Cheddar blocks slipped by 1.5 cent on Wednesday to close at $1.79 per pound after a trading session with one carload sale and an uncovered offer to sell one carload.
Busy non-fat dry milk market
With 12 carload sales on Wednesday, the week's total of sales for Grade A non-fat dry milk reached 19 carloads. There was also an unfilled bid to buy three carloads and an uncovered offer to sell one carload as the price dipped by .25 cent to close at 84.5 cents per pound.
AA butter gained in price in every spot market trading session last week but that trend was reversed this week, including a 3.75 cent price drop on Wednesday. This left the price at $2.22 following a trading day with one carload sale and an uncovered offer to sell one carload.
Futures for dry whey have had very little price movement in recent weeks. On Wednesday of this week, the price remained at 28 cents per pound for August and held at between 31 and 38 cents per pound for all subsequent months through July of 2018.
In line with the drop in the Cheddar block price, the Class III milk futures prices slipped by 3 to 11 cents per hundred for all months from August 2016 through April of 2017 on the trading board early on Wednesday afternoon.
After dropping by 11 cents for the day, the highest available price was $17.19 per hundred for September 2016. All other monthly Class III futures prices through July of 2018 were in the $16s per hundred.
The national Class III milk base price for July is $15.24 per hundred. This is an increase of $2.02 from June but is $1.09 less than in July of 2015 and $6.36 per hundred below the record high price for July of $21.60 in 2014.
Dairy margin payment
Due to the $5.56 average margin per hundred on the milk prices and feed costs for May and June, the largest payout on the federal Margin Protection Program is being made for those two months. A total of $11.2 million is being paid to the approximately 1,400 dairy farmers who insured themselves for between a $6 and $8 per hundred margin under that program.
The weighted all-milk price used in that formula for June was $14.80 per hundred in both the United States and Wisconsin. Those were increases of 30 and 10 cents per hundred respectively from May of this year but decreases of $2.20 and $3.20 per hundred from June of 2015.
All-milk prices for June in the top 10 milk production states included $15.80 per hundred in both New York and Pennsylvania, $15.30 in Texas, $15 in Minnesota, $14.60 in Idaho, $14.10 in New Mexico, $13.70 in Michigan, and $13.83 in California.
Dairy export report
Cooperatives Working Together has received requests from Dairy Farmers of America, the Northwest Dairy Association (Darigold) of Washington, and the Michigan Milk Producers Association for financial assistance on four contracts to export dairy commodities.
Those products are 608,476 pounds of Cheddar cheese and 573,202 pounds of whole milk powder. They are scheduled to go to buyers in Asia and South America on deliveries from August to October of this year.