Block cheese prices dropped fairly dramatically Wednesday on the Chicago Mercantile Exchange. 

At the end of trading, block prices were $1.59 per pound, a drop of 11 cents from Tuesday.

“The drop in block cheese prices can be partially blamed on the premium that block cheese had been holding compared to barrel prices,” says Greg Scheer, dairy analyst at Doane Advisory Services. “Block cheese prices had been holding a 27-cent premium and the spread is historically much less.”

Barrel cheese closed at $1.44 per pound on Wednesday.  

In addition, USDA’s Cold Storage report released on Tuesday showed total commercial cheese inventories at the end of November up 17.4 percent from last year, which sent a bearish signal.