World Markets Driving Butter Prices Higher
Much speculation has taken place on butter’s big move higher in the CME markets and much of that story revolves around the world butter market. In the first quarter of 2017 the European Union produced 546.62 tons of butter, down 5¼% from levels produced in the first quarter of 2016. Demand for European butter has been strong and with less production this provides other countries with exporting opportunities, especially New Zealand and the U.S.
Products trades for Thursday were as follows:
- After an 8 ½ cent decline in butter on Wednesday markets moved back 5 ½ cents higher to finish at $2.40.
- Cheddar blocks and barrels both experienced weakness in Thursday’s product trades, with blocks dropping 1 ¾ cents and barrels dropping 3 cents. Grade A nonfat dry milk lost a ¼ cent to finish at 8 ½ cents per pound.
- Class III milk markets opened up lower and stayed there throughout. December was the lone month to trade higher and finished at $16.80 per cwt. June through December were down 18 and 22 cents while October declined 13 cents and November dropped 2 cents.
- At the close second half futures for 2017 were trading at an average $16.95 per cwt. 2018 prices also dropped 3 to 6 cents between February and May.
- Class IV markets saw modest gains of 7 to 15 cents in August through December and closed with a 2017 second half average of $16.79 per cwt.