Market Reports

By all accounts, there is still plenty of milk, and driers are running hard. In March, U.S. output of NDM and SMP reached 236 million pounds, up 0.6% from a year ago.

The feed markets tumbled once again this week and dairy producers can thank Brazilian farmers for the setback. Brazil lacks the infrastructure to hold this year’s bin-busting production. Brazilian soybeans outprice U.S. soy by such a wide margin, two ships with Brazilian soybeans will hit the U.S. Southeast coast this week.

With more cows in the barn, milk production climbed, but the increase was far from formidable. Our competitors overseas also reported modest growth.

Ink ran red on LaSalle Street this week, led by a precipitous decline in barrels. Blocks lost ground too, but their decline was not nearly so dramatic.

Over the holiday shortened week, every commodity lost ground at the CME spot market. Price declines were not limited only to the United States, however. At Tuesday’s Global Dairy Trade (GDT) event the GDT Index fell by 4.7%, weighed down by losses across every product except Cheddar cheese.

Last Friday, the spot Cheddar block market closed at $2.10/lb., the highest price in over two months. This week, however, the trajectory shifted dramatically. It appears that fundamentals may have caught up with the Cheddar market and ushered in the decline.