Dairy Margin Watch: Early October tightening
With the exception of the fourth quarter of 2014, dairy margins generally weakened since the end of September, as a combination of higher feed costs and lower milk prices reduced forward profitability projections, according to the latest CIH Margin Watch report from Commodity & Ingredient Hedging, LLC.
A bout of short-covering and slowing of the harvest pace reversed the steady decline in corn and soybean meal prices that had been a feature through the month of September.
USDA’s October World Ag Supply & Demand Estimates (WASDE) raised the production and ending stocks estimates for both corn and soybeans, although the adjustments were below trade expectations. Milk prices, meanwhile, have been pressured by a steep fall in butter over the past several sessions. Even with this drop, CME butter prices remain above world values, signaling additional pressure over the near to medium term.
CWT assists with 3.3 million lbs. of butter, cheese export sales
Cooperatives Working Together (CWT) accepted nine requests for export assistance sell 3.252 million lbs. of butter (82% milkfat) and 55,116 lbs. of cheddar cheese to customers in Europe, the Middle East and North Africa.
Bids were accepted from CTW-member cooperatives Dairy Farmers of America (DFA) and Tillamook County Creamery Association to The product will be delivered December 2014 through April 2015.
Year-to-date, CWT has assisted member cooperatives in selling 86.677 million lbs. of cheese, 51.426 million lbs. of butter and 37.847 million lbs. of whole milk powder to 43 countries on six continents. These sales are the equivalent of 2.234 billion lbs. of milk on a milkfat basis.
Sales results from a special dairy heifer sale held Oct. 17, at Turlock, Calif. 1195 head sold. The market was very active with 90 % of dairy replacements staying in California and 10% going out of state. Weigh cows and bulls steady with a week ago.
Top 30 milk cows averaged 2715, with top of 3200.
Top 30 fresh heifers averaged 2550, with top of 3000.
Top 30 springers averaged 2480, with top of 2900.
Prices $/head unless otherwise noted:
#1 Hol Springers: 2200-2900
#2 Hol Springers: 1600-2100
# 1 Jer Springers: 1800-2450
# 1 Jer x Springers: 1500-2500
Holstein Bred Heifers
Holstein Open Heifers
Jersey Bred Heifers
Jersey Open Heifers
Weigh Dairy Cows
Top Yielding 110-124/cwt.
Med Yielding 87-109/cwt.
Low Yielding 55-86/cwt.