cheddar blocks closed Friday at $1.91 per pound, up 2 1/2-cents on the week and 34 cents above a year ago.
The barrels sank to $1.6675 Thursday but rallied Friday, jumping 8 1/4-cents, to $1.75, a half-cent lower on the week, after plunging 10 1/2-cents the previous week, but are 24 3/4-cents above a year ago.
The spread grew to 23 cents Thursday, a gap not seen since May 2013, but finished Friday at 16 cents. Only three cars of block traded hands on the week and 49 of barrel.
The blocks were unchanged Monday but inched up a half-cent Tuesday, to $1.9150, as traders awaited Tuesday afternoon’s October Cold Storage report and a shortened holiday week.
The barrels lost a penny Monday and 2 1/2-cents Tuesday, slipping to $1.7150, 20 cents below the blocks. The markets are closed Thursday and Friday for Thanksgiving.
“Midwest cheese production is active as manufacturers are working hard to get orders filled before the holidays,” according to Dairy Market News. Western contacts say a lot of milk is going into cheese.
Spot butter’s return to $2 per pound was tested, slipping to $1.98 last Tuesday, then regained a nickel Wednesday. The Friday close of $2.03 per pound was up 2 cents on the week but 85 1/2-cents below a year ago. Twenty-five cars exchanged hands last week at the CME.
The butter gave up 2 cents Monday but shot up 4 cents Tuesday, to $2.05 per pound, highest spot since Sept. 1.
“Central region Class II processors continue pulling substantial amounts of cream ahead of the year-end holiday,” reports DMN. “As a result, light to moderate cream availability is somewhat curtailing butter production.
“Western output is running strong as butter makers work hard to meet remaining 2016 commitments.”
Grade A nonfat dry milk saw a 90 cent per pound close Friday, up 2 1/4-cents on the week and 12 cents above year ago. Seventeen cars were sold on the week.
The powder inched a quarter-cent higher Monday, then gave it back Tuesday.
October milk up 2.7 percent
October milk production in the top 23 producing states totaled 16.5 billion pounds, up a bearish 2.7 percent from October 2015, according to USDA’s preliminary data, and the 33rd consecutive month output was above that of a year ago.
The 50-state total, at 17.6 billion pounds, was up 2.5 percent. Revisions lowered the original September 23-state estimate by 6 million pounds, now put at 16.0 billion pounds, up 2.3 percent from a year ago.
October cow numbers in the 23 states totaled 8.67 million head, down 2,000 from September but 31,000 more than a year ago. Output per cow averaged 1,903 pounds, up 43 pounds from a year ago, thanks to mild weather conditions, and is the highest October output since the series began in 2003.
California topped year ago output for the first time in 23 months, up 1.8 percent despite a drop of 11,000 cows. Output per cow made the difference, up 45 pounds.
Wisconsin was up 2.2 percent, on a 45-pound gain per cow but cow numbers were down 2,000 head.
Idaho was up 4.0 percent, thanks to a 40-pound gain per cow and 12,000 more cows. New York was up 4.7 percent on a 90-pound per cow gain but cow numbers were unchanged.
Pennsylvania was up 2.2 percent, thanks to a 50-pound gain per cow offsetting a loss of 4,000 cows. Minnesota was up 1.9 percent on a 30-pound gain per cow and 1,000 more cows
Michigan was up 4.9 percent, thanks to 12,000 more cows and 40 pounds more per cow. New Mexico topped year ago output by 1.1 percent, on a 35-pound gain per cow, though cow numbers were down 2,000 head.
Texas really poured it in the tank in October, besting the other states with an 8.2 percent jump in milk output, thanks to 26,000 more cows than a year ago and output per cow being up 45 pounds.
Washington state was up 2.2 percent on a 45-pound gain per cow though cow numbers were down 2,000 head.
Plenty in the cooler
The U.S. has plenty of dairy products to consume. USDA’s Cold Storage report pegs Oct. 31 butter stocks at 227.7 million pounds, down 41.4 million pounds or 15 percent from September, but 48.9 million pounds or 27 percent above those in October 2015.
American type cheese, at 729.9 million pounds, was down 12.9 million pounds or 2 percent from September but 33.2 million or 5 percent above a year ago.
The total cheese inventory stood at 1.2 billion pounds, down 19.9 million pounds or 2 percent from September but 69.4 million pounds or 6 percent above a year ago.