The volatility in the dairy market has continued into the new year. February Class III futures moved from a low of $16.99 on January 4th to a high of $19.88 on January 7th. That’s a swing of $2.89.
Experts say the announcement of a fifth round of the Farmers-to-Families Food Box Program is responsible for much of that volatility.
Last year was the most volatile year on record when it comes to milk prices. In 2020 the spread between the lowest and highest prices was $12.40, and that’s a record price swing for Class III.
And even though the government continues to buy dairy, cheese consumption is weaker.
The USDA Economic Research Service releasing domestic dairy consumption data for November. According to the report, total domestic consumption of cheese was weaker compared to 2019.
But butter continues to push higher. Consumption of American cheese increased almost 12-million lbs. All other cheese consumption was down 15-million lbs. Butter consumption increased almost 190,000 lbs.
