Market Reports

The dairy markets have once again proven the old trading adage that the best cure for high prices is high prices. Butter buyers seem confident that they have enough product to keep cases stocked through the holidays. Plentiful cream and pricey butter kept churns running unusually hard through the summer.

After the fireworks of last week, the cheese markets have spent the past few days coming back to earth. Barrels distanced themselves from the all-time high notched on Wednesday of last week, giving up 29.25¢ since last Friday to end the week at $2.2975/lb. Blocks also moved downward, albeit...

U.S. milk output fell short of year-ago volumes for the 14th straight month in August. The deficit was narrow; production was just 0.1% lower than August 2023. Given sizable improvements in milk components, butterfat and protein output were surely higher than last year, and it’s possible that milk solids output also topped August 2023 volumes. But August 2023 set a very low bar, and, at least on a fluid basis, U.S. milk output failed to clear it.

The dairy markets moved higher again as the trade grappled with structural barriers to expansion throughout the Northern Hemisphere. In the United States, limits to growth are well known.

Tighter milk supplies and lower milk solids output have stiffened competition among dairy processors. While there are no obvious winners, there is a clear loser.

The bears went into hibernation a little early this year, and the bulls enjoyed raucous celebrations on LaSalle Street. Milk and dairy product futures soared to life-of-contract highs amid continued barriers to growth.