Opportunity Exists In Butter and Cheese
The downward spiral that has consumed the CME spot cheese trade of late came to an end on Wednesday as barrel cheese finished unchanged and finished at $1.50. Looking back in time, the $1.50 region is just one cent lower than the low made at the start of August as prices retraced from their previous run higher. On Wednesday blocks settled just 3/4 cent lower, a much softer finish than recent days to end at $1.52. As with barrels, that brings us within one cent of the low that was established following the last sell off in June, and stands 3 cents higher than the low that was made in late April.
If both seasonal demand and this recent range from roughly $1.50 to $1.75 should hold, then opportunity is now laying at the buyers' doorstep.
Optimism returned in the butter market as well. It finished 4 cents higher at a price of $2.59 1/2, and powder rose 1 1/2 cents to 86 cents per pound.
The Class III market did very little with the softer cheese trade. The average price from now through the end of the year finished at $16.38, unchanged from Tuesday. Class IV markets saw an uptick in volume, and rose 5 cents in its average to finish at $16.34.