DairyBusiness Update for April 2, 2013
March California 4a/4b prices decline
The March 2013 California Class 4a milk price is $17.87/cwt., down 14¢ from February, but $2.54 more than March 2012. It brings the first-quarter 2013 average 4a price to $17.65/cwt., $1.98 more than the same period in 2012.
The March 2013 California Class 4b price is $15.02/cwt., down 39¢ from February, but $1.35 more than March 2012. The first-quarter 2013 average 4b price is $15.42/cwt., up $1.65 from 2012.
Federal order March Class II, III & IV prices are announced April 3.
CWT assists with 7.5 million lbs. of cheese and butter export sales
Cooperatives Working Together (CWT) accepted 28 requests for export assistance from Dairy Farmers of America, Northwest Dairy Association (Darigold), Michigan Milk Producers Association, United Dairymen of Arizona and Upstate Niagara Cooperative (O-AT-KA) to sell 5.899 million lbs. of cheddar cheese and 1.636 million lbs. of butter to customers in Asia, Europe, the Middle East, North Africa and Oceania. The product will be delivered April through September 2013.
So far in 2013, CWT has assisted member cooperatives in selling 47.055 million lbs. of cheese, 46.484 million lbs. of butter, 44,092 lbs. of anhydrous milk fat and 218,258 lbs. of whole milk powder to 30 countries on six continents. These sales are the equivalent of 1.449 billion lbs. of milk on a milkfat basis. That is equal to 90% of USDA’s projected increase in milk marketings for all of 2013.
2013 hay acreage steady, but dairy states may see declines
While corn and soybeans got most of the attention, USDA’s Prospective Plantings report, released March 28, indicated U.S. producers intend to harvest 56.4 million acres of all hay in 2013, up slightly from 2012.
Hay acreage is expected to decline from last year across most of the East, Southwest and Great Lakes regions. Record low acreage is expected across several New England states, as well as Iowa, Michigan, Minnesota, New Jersey, Ohio, Pennsylvania and Wisconsin.
In contrast, Montana is expecting to harvest 2.7 million acres of hay in 2013, up 500,000 acres (+23%) from 2012.
In the 23 major dairy states, largest acreage declines will be in Virginia (-105,000 acres); California and Colorado (-100,000 each); Wisconsin (-70,000); Colorado (-50,000); Iowa (-40,000); and Florida (-30,000). Missouri (+140,000) and Texas (+100,000) will post large acreage increases.
On a percentage basis, largest “dairy state” acreage declines will be in Florida and Ohio (-9% each); Virginia (-8%); California (-6%); and Vermont and Wisconsin (-5%).
• To see the full Prospective Plantings report, visit http://usda01.library.cornell.edu/usda/current/ProsPlan/ProsPlan-03-28-2013.pdf
Dairy commercial stocks built in November-January
Commercial disappearance of dairy products during the three-month period (Nov. 2012-Jan. 2013) totaled 49.22 billion lbs., 0.6% above the same period of 2011-12, but less than total dairy producer milk marketings for the same period. Ending commercial stocks on a milk-equivalent, milkfat basis were estimated at 13.47 billion lbs., up 7.7% from a year earlier.
Milk production for the three-month period was estimated at 49.92 billion lbs; milk marketings totaled 49.67 billion lbs. Beginning commercial stocks (11.74 billion lbs.) and imports (1.27 billion lbs.) added to the total available for commercial disappearance.
Comparing disappearance levels with the November-January period a year earlier: butter was down 14.8%, at 404.6 million lbs.; American cheese was up +1.7%, at 1.10 billion lbs.; other cheese was up +1.2%, at 1.77 billion lbs.; nonfat dry milk was down 33.6%, at 272.1 million lbs.; and fluid milk products were down -2.1%, at 13.55 billion lbs.
Source: Dairy Market News
MARKETS: Powder jumps; Class III futures higher
Today's market closing prices:
Butter: up 0.25¢, to $1.6325/lb.
Cheddar blocks: unchanged, at $1.6925/lb.
Cheddar barrels: up 0.5¢, to $1.6125/lb.
Grade A nonfat dry milk: up 5.0¢, to $1.64/lb.
Extra Grade nonfat dry milk: unchanged at $1.56/lb.
Class III milk: +12¢ to +33¢, April through December 2013. Based on current CME closing prices, the 2013 average is $18.43/cwt.; and the 2014 average is $16.73/cwt.
Corn, soybean futures mixed/ meal prices higher
Corn: -2¢ to +4¢ per bushel through December 2013. The 2013 average is $5.90/bu.
Soybeans: -4¢ to +3¢ per bushel through December 2013. The 2013 average is $13.29/bu.
Soybean meal: +$1.00 to +$4.40/ton through December 2013. The 2013 average is $375.72/ton.
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