DairyBusiness Update: Dec. 31, 2013
California 4b milk price jumps 73 cents
California’s 4b milk price ends 2013 on an up note. The California Department of Food and Agriculture announced its cheese milk price today at $18.03/cwt., up 73¢ from November and $1.73 above December 2012. The 2013 4b average is $16.42, up from $15.54 in 2012 and $16.37 in 2011.
The December 4a butter-powder price is $21.16, up 53¢ from November and $3.69 above a year ago. Its 2013 average is $18.85, up from $15.63 a year ago and $18.82 in 2011. Comparable Federal order prices are announced by USDA on Thursday, January 2.
California powder still below CME spot
The California Department of Food and Agriculture announced its latest surveyed nonfat dry milk prices today at $1.9436/lb. for the week ending December 27, on sales of 4.52 million lbs. The price was up from $1.9321/lb. the week before, on sales of 7.82 million lbs.
Cheese output will be higher this week
Cheese production is expected to see some increases this week as surplus holiday milk becomes available, according to USDA’s Dairy Market News (DMN). Smaller plants and many Class I and II production lines will go quiet over the holiday and their milk will clear to larger facilities. Retail sales continue to be good with specials for football bowl and playoff viewers.
The butter market is firm behind good sales and lighter supplies throughout the regions. Production rates increased last week as additional cream was secured for churning. Export interest is good with more opportunities available as 2013 comes to a close. Inventories are being replenished in most butter plants across the regions, says DMN.
Time to sing Auld Lang Syne
Hard to believe that 2013 has come and gone. What does 2014 hold? If we knew, what would we do about it? Good questions with no real answers. For some 2013 was a year of pain and regret, for others it was a turning point to joy and happiness. As I reflect on what to write this last day of 2013, the most profound thing that comes to mind is to be there for others in 2014, for our family and loved ones first, but to our neighbors, friends, and even the strangers we encounter along the way. I think that’s what “walking by faith is about.”
On behalf of all of us at DairyBusiness Update and DairyBusiness Communications, I wish you peace, joy, and God’s favor in 2014 and we thank you for allowing us to serve you and this great industry.
Mielke Market Daily for Tuesday
(A daily wrap-up of dairy markets and the things affecting them, from DairyBusiness Update associate editor Lee Mielke)
2013 ends on a down note for cash cheese, at least on the barrel side of things. One car was traded this morning at yesterday’s close of $1.91/lb. but a second trade came at $1.85/lb., down 6¢, following a 6¢ loss yesterday. They will start the new year at $1.85/lb., while the blocks remain at $2.00/lb., an unsustainable 15¢ above the barrels. There was no activity on the blocks today but downward pressure will surely be there.
FC Stone market analyst Derek Nelson wrote in this morning’s eDairy Insider Opening Bell that “More milk has been going into manufacturing operations during the holiday break for schools, but he says the main factor is weaker demand from reluctant buyers at current prices.”
On a brighter note, the cash butter price gained 1¢ this morning, reversing 3 previous declines. Four cars traded hands, all at $1.5325/lb. Two bids at that price went unfilled. Derek Nelson wrote this morning that “buyer interest will likely keep spot prices above $1.50/lb.”
Cash Grade A nonfat dry milk gave up another 3¢ this morning, following a 2¢ decline yesterday, and fell to $2.06/lb. Six cars were sold this morning, all at $2.06/lb., and a bid at that price was left on the board. Extra Grade was unchanged again, holding at $2.09/lb., with no activity.
Today’s market closing prices:
Butter: Up 1¢, to $1.5325/lb.
Cheddar blocks: Unchanged, at $2.00/lb.
Cheddar barrels: Down 6¢, to $1.85/lb.
Grade A nonfat dry milk: Down 3¢, to $2.06/lb.
Extra Grade nonfat dry milk: Unchanged, at $2.09/lb.
Class III milk: Jan.$19.34, +8¢, Feb.$18.67 +6¢, Mar. $18.35 -8¢, Apr. $18.03 -11¢, May $17.87 -3¢, & Jun. $17.73 -7¢. Based on today’s CME closing prices, the Q4 2013 average is $18.68/cwt.; with an overall 2013 average of $17.99/cwt.; and a 2014 average of $17.93/cwt., -4¢ from yesterday.
The Chicago Mercantile Exchange is closed tomorrow, New Year’s Day, and reopens Thursday and Friday. The Agriculture Department will announce December Federal order Class II, III, and IV milk prices on Thursday afternoon, January 2, and the November Dairy Products report is issued Friday, January 3.
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Wednesday on DairyLine:
We ring in the new year with IDFA's Peggy Armstrong and PDPW's Shelly Mayer