'Bearish' Report Was Expected
Published: Friday, June 12, 2020
The following is from Lee Mielke, author of a dairy market column known as "Mielke Market Weekly."
Buttermilk and whole milk powder nudged the Global Dairy Trade's (GDT) weighted average .1 percent higher last Tuesday, following a 1-percent gain on May 19. Sellers brought 48.4 million pounds of product to market, highest since March 17.
Buttermilk powder was up 9.4 percent, with whole milk powder up 2.1 percent, after it slipped .5 percent in the last event.
Cheddar led the decline, down 5.3 percent, after dipping 6 percent last time. Butter was down 4.4 percent, after a 1.9 percent decline, and anhydrous milkfat was down 2.9 percent, after rising 2.7 percent. Skim milk powder was off .5 percent, after jumping 6.7 percent on May 19.
FC Stone equated the GDT 80-percent butterfat butter price to $1.6069 per pound U.S., down 7.6 cents from the last event. CME butter closed last Friday at $1.9250. GDT Cheddar cheese equated to $1.5969 per pound, down 15.6 cents, and compares to last Friday's CME block Cheddar at a world high $2.5525. GDT skim milk powder averaged $1.1477 per pound and whole milk powder averaged $1.2522. CME Grade A nonfat dry milk closed last Friday at 97.75 cents per pound.
U.S. dairy exports were mixed in April. The USDA's latest data shows total cheese exports at 58.9 million pounds, down 17.6 percent from April 2019 and the third month in a row they were below year ago levels. Butter fell to 2.5 million pounds, down 7.7 percent. Combined nonfat dry milk/skim milk powder totaled 149.8 million pounds, up 19.9 percent, and whole milk powder was up 17 percent. Dry whey exports, at 37.3 million pounds, were up 20.4 percent from a year ago.
HighGround Dairy points out that total dairy exports to Mexico were the weakest since July 2017 and the lowest for the month of April since 2014. The most notable losses were on nonfat dry milk and cheese.
U.S. dairy exports continue via the Cooperatives Working Together program. CWT member cooperatives accepted six offers of export assistance the first week of June on sales of 1.26 million pounds of Cheddar going to customers in Asia.
You'll recall that April milk output was reported at 18.7 billion pounds, up 1.4 percent from April 2019, but that included milk that was dumped which amounted to an estimated 187 million pounds, according to the Dairy and Food Market Analyst. The Dairy Products report shows where the milk that wasn't dumped ended up.
April total cheese output slipped to 1.07 billion pounds, down 5.1 percent from March and 1.7 percent below April 2019. The year-to-date total stood at 4.3 billion pounds, up .1 percent from a year ago.
Wisconsin produced 266.9 million pounds of the April total, down 6.6 percent from March and 4.6 percent below a year ago. California output, at 200.8 million pounds, was down 4.8 percent from March and 5.4 percent below a year ago. Idaho contributed 85.5 million pounds, down 4.2 percent from March but 2 percent above a year ago. Italian-type cheese totaled 451.7 million pounds, down 7.2 percent from March and 5 percent below a year ago. YTD output came to 1.87 billion pounds, down 1.1 percent.
American-type cheese totaled 446 million pounds, down .9 percent from March and 3.6 percent below a year ago. YTD American was at 1.75 billion pounds, up 1.6 percent.
Mozzarella output fell to 352.5 million pounds, down 5.4 percent from a year ago, with YTD at 1.48 billion pounds, down 1 percent.
Cheddar, the cheese, traded at the CME, jumped to 330.4 million pounds, up 12.1 million pounds, or 3.8 percent, from March and 23.9 million, or 7.8 percent, above April 2019. Year-to-date Cheddar stood at 1.3 billion pounds, up 1.8 percent from a year ago.
Butter production climbed to a record high 215.7 million pounds, up 19.8 million pounds, or 10.1 percent, from March and a whopping 43.3 million pounds, or 25.1 percent, above a year ago, the ninth consecutive month it topped a year ago. YTD butter output stood at 793.1 million pounds, up a hefty 9.5 percent from 2019.
Dry whey totaled 77.8 million pounds, down 5.2 percent from March but 3.8 percent above a year ago, with YTD at 320.7 million pounds, up 3 percent. Dry whey stocks totaled 75.4 million pounds, up 3.7 percent from March and .5 percent below a year ago.
Nonfat dry milk output totaled 183.3 million pounds, up 10.9 million pounds, or 6.3 percent, from March and 15.5 million, or 9.3 percent, above 2019. YTD powder is at 691.1 million pounds, up 4.7 percent from 2019. Stocks swelled to 392.6 million pounds, up 43.5 million, or 12.5 percent, from March and 114.3 million, or 41.1 percent
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