National Dairy Market at a Glance
USDA - Fri Dec 29, 1:59PM CST
MD_DA950
DY, DAIRY 
MD DA950 NATIONAL DAIRY MARKET AT A GLANCE 

December 29, 2017 MADISON, WI (REPORT 52) 

CME GROUP CASH MARKETS (12/29) 
BUTTER: Grade AA closed at $2.2075. The weekly average for Grade AA is $2.1969
(+.0039).
CHEESE: Barrels closed at $1.4425 and 40# blocks at $1.5400. The weekly average for 
barrels is $1.4356 (-.0189) and blocks, $1.5156 (+.0536).
NONFAT DRY MILK: Grade A closed at $.6775. The weekly average for Grade A is $.6644 
(+.0104).
     BUTTER HIGHLIGHTS: Cream for butter production is plenteous, as other dairy 
processing plants remain closed for the holidays. Butter production remains active 
as producers are pushing to burn through large cream volumes. A few plant managers 
report adding extra shifts or running additional churns. Inventories are plentiful. 
Some butter makers are taking advantage of the large cream volumes and are building 
inventories in preparation for the spring. Bulk butter prices range from 1 cent to 
8 cents over the CME average. The market undertone is softening a bit. Butter sales 
are light, with orders made around short-term immediate needs. Friday's CME group 
cash trading saw Grade AA butter close at $2.2075, up $0.0275 from last Friday.
     CHEESE HIGHLIGHTS: Milk supplies remain abundant for cheese production 
nationwide. Cheese production in all regions is steady to strong. However, in the 
Northeast, cheese contacts reported some plants are still closed from last week. 
Heavy blizzard conditions over the holidays are causing slower travel. While in the 
Midwest, a majority of cheese plant managers plan to run six to seven day workweeks 
in order to manage the influx of discounted milk flowing into the vats. Cheese 
inventories are heavy and expected to increase due to milk supplies. Cheese demand 
is generally stable. The cheese market tone is mixed. Some contacts suggest heavy 
barrel trading on the CME has helped improve the long inventory situation. However, 
some producers relayed that the up and down market prices, particularly regarding 
barrels, have created buyer hesitancy in what is typically the busiest season.  
Friday on the CME, barrels closed at $1.4425, up $.0325 from last Friday. Blocks 
closed at $1.5400, up $.0475 from last Friday.  
     FLUID MILK: Milk supplies are abundant for all facets of manufacturing this 
week. Some milk suppliers reported that milk was over capacity and had to use extra 
tankers for storage. Bottling intakes remain lower. However, schools reopening in 
the first week of 2018 are expected to increase ordering. Winter weather has hit 
portions of each region this week, and some contacts suggest that this may lead to 
some milk output decreases. Like milk, cream is abundant and holiday backups were 
reported. Lots of cream is finding its way into butter churns, as cream sellers 
relay that many types of cream processors have light production schedules over the 
holiday. Cream multiples for all usages are .95-1.10 in the East, 1.00 to 1.10 in 
the Midwest, and .90-1.00 in the West.
     DRY PRODUCTS: Low/medium heat nonfat dry milk (NDM) prices continue to 
decline.  The NDM market tone is unsettled. The demand is weak in comparison to 
supplies. High heat NDM prices are slipping. The market tone is weak. Inventories 
reported to be adequate and available. Dry buttermilk prices are steady to lower. 
Demand is sluggish. The market undertone is soft. Dry whole milk prices are steady 
to lower. Demand is light in the spot market. Dry whey prices are down. Demand is 
lackluster. The dry whey market tone is weak. Whey protein concentrate 34% prices 
are unchanged this week. The demand fell silent. Lactose prices are unchanged this 
week. The market is inactive due to the winter holidays. Rennet and casein prices 
are steady. The market has seen little activity for the shortened holiday week.
     ORGANIC DAIRY MARKET NEWS: Federal Milk Market Order 1 in New England reports 
that during November, 2017, organic whole milk utilization by pool plants totaled 
15.1 million pounds, down from 15.8 million pounds one year earlier. The November, 
2017 butterfat content was 3.29 percent, even with 3.29 percent in 2016. Organic 
reduced fat milk utilization for November this year, 20.6 million pounds, was down 
from 22.6 million pounds one year earlier. Butterfat this November was 1.30 
percent, up from 1.29 percent last year.
     NATIONAL RETAIL REPORT (DMN): Advertising numbers for some dairy products are 
lower following the holidays. Ads for 1 # butter declined 72 percent, with a U.S. 
weighted average advertised price of $3.13, down 8 cents.   Organic butter 
generated an average price of $4.94, resulting in a $1.81 organic premium. 
Conventional sour cream in 16 oz. packages averaged $1.73, down 12 cents. Ad 
numbers declined 12 percent. Organic sour cream averaged $2.16, an organic price 
premium of 43 cents. Conventional 8 ounce cream cheese averaged $1.57, down 6 cents 
from last week. Ad numbers declined 29 percent. There are no ads for organic cream 
cheese. The national weighted average advertised price of 8 oz. block cheese is 
$2.17, down 3 cents from last week.  The price of 8 ounce shredded cheese, $2.12, 
is up 4 cents from last week.   The vast bulk of cheese ads are for these two 
package sizes and types. There are no ads for organic cheese. Conventional cheese 
ad numbers increased 3 percent from last week. The most advertised yogurt product 
was the 4-6 oz. package of Greek yogurt, with 4-6 ounce yogurt a close second. The 
weighted average price of 4-6 ounce Greek yogurt, $0.95, is down 5 cents from last 
week. The price for 4-6 oz. yogurt, $0.49, is 13 cents lower than last week.  
Conventional yogurt ad numbers increased 24 percent. While organic yogurt ad 
numbers increased 22 percent, the only ads are for 32 ounce organic yogurt, 
averaging $2.99, even with last week. The conventional-organic milk half gallon 
price spread is 93 cents.  The spread is the difference between the conventional 
milk half gallon average advertised price, $2.27, and the organic milk half-gallon 
price, $3.20. Even though organic milk production is estimated at 5 - 10 percent of 
U.S. milk production, depending on the source, this week there are over twice as 
many organic milk ads as conventional milk ads.
     COLD STORAGE (NASS): On November 30, U.S. cold storage holdings of butter 
totaled 158.8 million pounds, 27 percent lower than a month ago and 2 percent lower 
than last year.  Natural American cheese holdings total 733.2 million pounds, 1 
percent lower than a month ago, but 3 percent higher than a year ago.  Total 
natural cheese stocks totaled 1.26 billion pounds, 1 percent lower than one month 
ago, but 6 percent higher than from one year ago.       
     NOVEMBER AGRICULTURAL PRICES HIGHLIGHTS (NASS): The All Milk price received by 
farmers was $18.10 in November, up $.30 from November 2016. The alfalfa hay price 
was $148.00 in November, up $18.00 from November 2016. The corn price was $3.15 in 
November, down $0.09 from November 2016. The soybean price was $9.22 in November, 
down $0.25 from November 2016. The milk-feed price ratio was 2.54 in November, down 
0.05 from November 2016. The index of prices received by farmers for dairy products 
during the month of November 2017 was up 3.7 to 91. Compared to November 2016, the 
index was up 7.6 points (9.1 percent). The index of prices paid by farmers for 
commodities and services, interest, taxes, and wage rates in November 2017 was up 
0.3 points to 107.9. Compared with November 2016, the index was up 4.7 points (4.6 
percent).
     NOVEMBER CONSUMER PRICE INDEX (BLS): The CPI for all food is 250.9, up 1.4 
percent from 2016.  The dairy products index is 216.9, no change from a year ago.  
The following are the November to November changes for selected products: fresh 
whole milk is -3.0 percent; cheese, +1.2 percent; and butter, +7.1 percent.


1330 CT Al Yang - Al.Yang@ams.usda.gov 608-422-8598
USDA/AMS/Dairy Market News, Madison, Wisconsin
Dairy Market News website: http://www.ams.usda.gov/market-news/dairy
Dairy Market News database portal: http://www.marketnews.usda.gov/mnp/da-home