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Milk Futures, Cash Dairy Steady to Lower
March 16, 2016

In Class III trade at the Chicago Mercantile Exchange, milk futures were mostly lower, continuing to be pressured by the large available global supply and demand concerns.

March was unchanged at $13.79, April was down $.08 at $13.40, May was $.07 lower at $13.29, and June was down $.12 at $13.29.

Over in the spot market, cash cheese barrels were $.0125 lower at $1.43. The last offer uncovered was for one load at the closing price. Blocks were unchanged at $1.4875.

Butter was down $.015 at $1.925 with one load sold. The last bid unfilled was on one load at $1.925.

Nonfat dry milk was $.0075 lower at $.7375 with one load sold. The last bid unfilled was on one load at $.7325. The last offer uncovered was for one load at $.74.

The Global Dairy Trade index for March 15th was down 2.9% from the previous auction at $2,190 per ton. Prior to the gain on the 1st, the index had declined for four consecutive auctions. There were 134 participating bidders and the quantity sold was 20,406 tons. Butter milk powder was up 6.4% and lactose was 0.8% higher. Rennet casein dropped 7%, anhydrous milk fat declined 6.5%, cheddar was down 5.6%, butter was 2.8% lower, skim milk powder lost 2.5%, and whole milk powder was down 0.8%.

The next auction is scheduled for Tuesday, April 5th.

The USDA’s Economic Research Service has lowered the 2016 all-milk price projection to $14.95 to $15.55 per hundredweight, compared to February’s range of $15.30 to $16. The Class III price is estimated at $13.60 to $14.20 with Class IV at $13.05 to $13.75. The 2016 cheese price is pegged at $1.505 to $1.565 per pound and butter is projected at $2.01 to $2.10. Dry whey is expected to be between $.23 and $.26, with nonfat dry milk at $.77 to $.82. Annual production is expected to be 211.6 billion pounds, slightly less than a month ago, including 52.8 billion in the first quarter of the year and 54 billion in the second quarter. The number of milk cows is estimated at 9.305 million head with milk per cow of 22,745 pounds. Marketings are expected to be 210.6 billion pounds. On the milk fat basis, imports are seen at 7 billion pounds with exports of 8.2 billion pounds. For skim solids, imports are pegged at 6.4 billion pounds with exports of 36.3 billion.

Source – Dairy Agenda



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