Daily CME closing

Daily CME Cash Trading on Tuesday, June 3, 2014











Cheddar barrels



Cheddar blocks



NFDM Grade A



Butter Grade AA




Dairy Margin Watch: May margins end month stronger

Dairy margins strengthened since the middle of May, due to a combination of steady to higher milk prices while corn continued to decline, according to the latest CIH Margin Watch report from Commodity & Ingredient Hedging, LLC.

From a historical perspective, margins remain well above the 90th percentile of the past 10 years through the first half of 2015, providing a rare opportunity for dairies to protect very attractive forward margins over an extended period of time.

While CME Class III milk futures continue to trade at lofty levels, the weekly average spot cheddar block price has been declining and is off 18% since the peak in late March. Moreover, global cheese prices are dropping as well, with Oceania cheddar prices down 13% in the same period, and German Edam prices off 14%.

USDA’s Cold Storage report reflected April cheese stocks of 1.04 billion lbs., up 1.8% from March, but down 7.6% from last year. While U.S. cheese stocks remain tight, they are showing signs of building, and this could begin to pressure forward milk prices as a result.

Corn futures meanwhile have dropped more than 50¢/bushel during May, as weather conditions have allowed planting progress to catch up. USDA reported corn planting at 88% complete through the week ended May 25, up 15% from last week and right in line with the 20-year average. In addition, there are expectations for very strong corn condition ratings.

Soybean meal prices, however, have advanced to new highs recently as they draw continued support from tight old-crop supplies and a slowing domestic crush pace. Visit www.cihmarginwatch.com.


CWT assists with 1.3 million lbs. of cheese, WMP export sales

Cooperatives Working Together (CWT) accepted 11 requests for export assistance to sell 850,984 lbs. of cheddar and Gouda cheese and 434,311 lbs. of whole milk powder.

The bids were accepted from CWT-member co-ops Dairy Farmers of America, Michigan Milk Producers Association, Northwest Dairy Association (Darigold) and Tillamook County Creamery Association. The products will be delivered  to customers in Asia, Africa, Central America, the Middle East, and North Africa between June through November 2014.

Year-to-date, CWT has assisted member cooperatives in selling 54.265 million lbs. of cheese, 46.284 million lbs. of butter and 10.772 million lbs. of whole milk powder to 40 countries on six continents. These sales are the equivalent of 1.618 billion lbs. of milk on a milkfat basis.


INTL FCStone sets lineup for Dairy Outlook Conference

INTL FCStone Inc. announced the speaker lineup for its 11th annual Dairy Outlook Conference, scheduled for June 18-19, in Chicago. The conference will feature experts on U.S. and global dairy supply and demand issues, as well as updates on commodities impacting dairy, including grains, oilseeds, meats and livestock, interest rates, currencies, energy and weather.

Keynote speaker Blu Putnam, managing director and chief economist of CME Group, will start the formal program with an economic overview at 9:30 a.m. Wednesday, June 18.

Robert Chesler, Vice President of FCStone, LLC's Food Service Division, will provide his outlook for the dairy markets, and technical analyst Peter Ullrich of Ullrich Analytics will wrap up the morning sessions.

The afternoon will begin with the panel discussion on the U.S. Farm Bill. Panelists will be Ed Gallagher, President of Dairy Farmers of America Risk Management; Chris Herlache, Schreiber Foods' Risk Management Team Leader, and Dave Kurzawski, Senior Broker FCStone, LLC.

Rene Friedman, Vice President Head of Legal and Compliance of INTL FCStone Inc. and David Porteous, attorney and partner at Ulmer & Berne LLP will talk about the Inside/Outside Regulatory Outlook. That will be followed with a weather outlook by Joe D'Aleo, Chief Forecaster for WeatherBELL Analytics LLC. John Snell, Managing Director, FCStone, LLC will conclude the afternoon with an analysis of the energy market.

Thursday morning's program will include looks at Grains, by Kyle Schrad, Risk Management Consultant, FCStone, LLC; Africa, by panelists Marc Beck, Executive Vice President of the United States Dairy Export Council, and David Hightower, president and editor of "The Hightower Report"; China, with Beck; and Meats and Livestock, by Ryan Turner, Risk Management Consultant, FCStone, LLC.

Sponsors of the Conference are Ulmer & Berne LLP, Schreiber Foods, CME Group, Cheese Market News and Eurex Group.

More information, including the full agenda for the Dairy Outlook Conference, is available at http://www.cvent.com/events/2014-dairy-outlook/agenda-6c51f21d4fdd410ca6aa0cd4a2182e1b.aspx.

INTL FCStone offers a series of conferences and workshops in a wide variety of industries. A list is available at https://www.intlfcstone.com/Events/.


U.S. groups say Japanese, Canadian dairy reforms needed on TPP

The majority of U.S. dairy farmer cooperatives and dairy processing companies – members of the National Milk Producers Federation (NMPF) or the U.S. Dairy Export Council (USDEC) – threatened to withdraw support from the pending Trans-Pacific (TPP) trade agreement if Japan and Canada refuse to follow through on pledges to provide comprehensive market access for U.S. dairy products. Read more