Dismal Dairy Day at the CME
Barrel cheese once again found some volume in Wednesday's trade with 16 loads trading. In the end, however, sellers led the charge and took prices down 1/2 cent to finish at $1.51. That was amplified in the block session where only one load traded but prices fell 4 1/4 to $1.56, leaving the spread now at 5 cents. Butter dropped as well to $2.23, falling a 1/4 cent, and grade A nonfat dry milk rested unchanged at 64 3/4, its historic low. Despite these lows, whey futures prices have been able to hold the line in recent days with the average price for now through June just under 26 cents.
In the last couple of days U.S. product prices have been at odds with Global Dairy Trade values, which in yesterday's auction saw lower fat prices, higher cheese prices, and a rising skim milk powder market. At the center of this trend has been the ongoing discussion of steel and aluminum tariffs, along with the possibility of souring trade negotiations.
Class III milk prices followed in an obvious fashion, falling 7 cents in the average from now through the end of the year. That March to December price average now rests at $15.09 per cwt. Class IV markets followed suit with their average for that same period dropping a nickel to $14.12.