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Dairy demand remains strong

| July 15, 2014 | 0 Comments
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By: Bob Meyer

Cash cheese, butter and Class III prices continued to move higher on the Chicago Mercantile Exchange on Monday.  Barrels closed at $1.9975 and blocks went back over the $2 mark at $2.005 per pound.

Cheese was slipping a bit last week until  word got out that milk supplies had tightened after the July 4thholiday weekend to the point cheese plants are not running at full capacity.  Add to that when at the end of the week the latest World Agricultural Supply and Demand Estimates from USDA reduced the 2014 total milk production as U.S. milk production is just not increasing as rapidly as had been expected.

Continued strength in the diary markets as global demand is just not backing-off even at higher prices and U.S. production is just not increasing at the pace many thought it would.  Daily Dairy Report notes U.S. exports of ice cream in May were a record 8,133 metric tons up more than 8 percent from a year ago.  Cream is at a premium thanks to ice cream, Greek yogurt and various dips.  That demand has cut into butter production as butter makers find it more profitable to sell the cream rather than make butter.  Meanwhile, the higher butter prices have not dampened demand at all.

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Category: Agriculture

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