Whey Boosts Class III Milk Checks
In October of last year, dairy products embarked on a price rally that would lead them through the fall toward peaks that eventually came in November and December. That was true of every dairy product with the exception of one: whey.
Cheese would peak in November at a price of $1.9425 in blocks. Butter would then peak in December at a price of $2.3525. Later, nonfat dry milk would peak in January at $1.0525. While there is no spot session trade for the whey market, values have continued to climb. That is until Wednesday, when prices peaked just over 48₵ in spot futures markets before dropping roughly a penny. The drop still leaves us at the highest prices we’ve seen since back in the spring of 2015. This is not unfamiliar territory. If we go back in time, from 2012-2014 whey prices camped out at a range of 50₵ to 70₵ per lb.
The good news for producers who depend on the Class III market as a staple to their milk check is that a great deal of the losses felt by the falling cheese price have been offset by the rising whey price. With prices moving from 25₵ in mid-2016 to the current levels, roughly $1.20-$1.50 has been added to the milk check. A strong export market has been helpful in getting prices to where they’re at, but now that remains in question.
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