Dairy markets continued to move higher for both classes of milk after the long weekend. Butter exports are leading the charge for the spot butter rally, causing Class IV futures to climb back to $20+ as we look at the forward curve. With EU prices still well above $3 per pound, demand for US butter remains strong. Cheese also is moving higher. EEX mozzarella is at €4,277 per metric ton, up 1.7%, which in USD translates to $2.19 per pound, still a stretch higher than today’s CME barrels at $1.8650 per pound. Block cheese was bought and sold with a frenzy of activity ending at $1.95, but futures had other plans, slipping about 20 cents in Q3. Consider signing up for any remaining Q3 coverage you’ve been thinking about for both Class III and IV milk.
Today’s Highlights from Ever.Ag’s Know Your Markets
- CME blocks gained three cents to reach the $1.95-per-pound mark, while barrels sat unchanged at $1.8650 per pound. Sixteen loads of blocks and one of barrels changed hands. Spot dry whey advanced to $0.5700 per pound, up 1.5 cents to a price last seen in February. Two lots traded. CME NDM rose to $1.2850 per pound, adding 1.5 cents, with two loads trading. After yesterday’s surge, spot butter saw the smallest price movement, up just a half cent to $2.5250 per pound. Trading volume was heavy, with 12 lots exchanged.
- Nearby Class III futures dropped despite the increase in spot cheese. The June contract fell 26 cents to $19.35 per hundredweight. “All cheese” also declined, with June down $0.0230 to $1.9880 per pound. Butter futures were mixed after yesterday’s “limit up” movements.
- Even with this week’s jump at the CME, US butter remains less expensive than that of global competitors. The US price average so far this week is $2.52 per pound compared to New Zealand’s $3.46 and EU’s $3.71. EU SMP slipped to $1.23 per pound, putting it below $1.28 reported in both New Zealand and the US. US cheese averaged $1.92 per pound so far this week, below $2.27 in New Zealand and $2.36 in Europe.
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