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Butter Update: Demand Still Strong

   Northeast butter production is marginally declining following the post-holiday milk and cream supply surge, according to USDA’s Dairy Market News. Some market participants are questioning with uncertainty, the pull on cream supplies as they suggest disproportionate volumes are available relative to milk supply volumes. The influence of current multiples is driving butter production decisions at some balancing plants. Butter sales are expected to pick-up in the domestic market with interests from food service and retail outlets. Inventories levels are somewhat unclear, although stocks are available to facilitate contractual agreements.

   Central butter prices softened following seasonal weaker sales. The market tone is unsettled. Cream availability varies amongst manufacturers, while milk supplies are increasingly growing. Butter production rates are mostly steady. Domestic buyer interest slowed.  International demand is steady as the global markets slowly converge closer with the U.S. prices. Butter inventories are maintaining to slightly higher. 

   Western butter production is mostly steady. Some producers are opting to sell excess cream rather than build butter inventories at current prices. Butter demand remains strong as most plants report tighter than usual stocks. Bulk butter sales continue to be strong as volume buyers look to acquire butter to fill future needs. Retail sales are mostly steady.