GDT Auction Bolsters CME Cheese Trade
GDT auction results set the tone for the day. The index of the eight products that are traded in this electronic auction was down 1.1%, and that was led by a lower move in whole milk powder, its flagship contract which fell 1.5% in its average price. The lower move was added to by rennet casein which was down 10.5% and anhydrous milk fat which fell 1.9%. Elsewhere, butter remained unchanged in its average price of $2.63 a pound. Butter milk powder, lactose, skim milk powder and cheddar all rose in their trade. Cheddar was up 3.1% to finish at a price of $1.83 a pound. Skim milk powder rose 3.6% to finish at 91 cents a pound.
In the wake of the higher cheddar price, the CME spot trade for blocks and barrels exploded. Barrels rose 11.5 cents on just five trades to finish at $1.6025. Blocks rose 3 cents on a pair of trades to finish at $1.66. In the wake of the softer fat trade on GDT, butter dropped a penny to finish at $2.36, while Grade A nonfat dry milk dropped three cents to finish it at 82.5 cents a pound. Dry whey remained unchanged finishing again at 31 cents.
Class III milk followed a logical path higher, but by afternoon moved back lower with prices finishing down 3 cents in its average from now through the end of the year at $15.96 per cwt.