LINKEDINCOMMENTMORE

Chicago, IL. — After a trading holiday on Monday of this week for Martin Luther King Day, activity for dairy commodities in the spot market at the CME Group was at moderate levels on Tuesday and Wednesday.

Prices for Cheddar cheese slipped on Wednesday as five carloads of barrels and three carloads of blocks were sold, following four carload sales of blocks on Tuesday. The barrel price dropped by 2.75 cents to close at $1.61 per pound while the block price was down by 1.25 cents for a closing price of $1.6925 per pound on Wednesday.

2016 cheese production

Although the data for December wont' be released for another two weeks, cheese production in the United States most likely topped 12 billion pounds in 2016 to set another annual record.

Through November, during which the production was 1.011 billion pounds, the total for 2016 had reached 11.014 billion pounds – an increase of 2 percent from 2015 for the first 11 months of the year. Wisconsin's share of the November production was 265.5 million pounds while California followed with 209.4 million pounds.

Class IV commodities

For the Class IV milk commodities in the spot market on Wednesday, there was no activity for AA butter. The price stood at $2.24 per pound – down by 3.25 cents from a week earlier.

The Grade A non-fat dry milk spot market was active with six carload sales, an unfilled bid to buy one carload, and an uncovered offer to sell one carload. The price rose by .50 cent to close at $1.0375 per pound.

Active dry whey market

The futures market for dry whey was extremely active on Wednesday as 26 to 53 contracts were completed for each of six different months in 2017. Prices on the trading board ranged from 43.25 cents per pound for January to a high of 49.5 cents for December of 2017.

Following the overall downward price pattern set by dry whey, the futures prices for Class III milk posted losses of 1 to 16 cents per hundred in trading on Wednesday. This put the day's closing prices at $16.78 per hundred for January, $16.93 for February, in the $17s for the final 10 months of 2017, and in the $16s per hundred for all months in 2018.

Negative December PPDs

Producer price differentials (PPDs) in three federal milk marketing orders (FMMOs) covering the central part of the United States remained in negative territory for December.

In FMMO 30, which covers Wisconsin and portions of adjacent states, the Chicago base zone PPD for December is a minus 19 cents per hundred. For the most distant milk receiving plants, it was a minus 39 cents. In adjacent FMMOs, the base zone negatives were 53 cents per hundred for Order 32 based at Kansas City and 61 cents per hundred for Order 33 based in northern Ohio.

With the negative PPD, the volume of milk pooled in Order 30 for December was down to 2.109 billion pounds. That milk had averages of 3.95 percent butterfat, 3.21 percent protein, and 5.72 percent other solids. Of the pooled milk, 71.1 percent was used in Class III (cheese production), 14.5 percent in Class I (fluid bottled milk), 7.8 percent in Class II (soft dairy products), and 6.6 percent in Class IV (butter and milk powders).

LINKEDINCOMMENTMORE
Read or Share this story: http://www.wisfarmer.com/story/news/2017/01/18/sales-highlight-mid-week-dairy-spot-markets/96736040/