MD_DA950 Dairy Markets at a Glance Report 42 - Released on October 22, 2021 CME GROUP CASH MARKETS (10/22) BUTTER: Grade AA closed at $1.8350. The weekly average for Grade AA is $1.8105 (+0.0315). CHEESE: Barrels closed at $1.8625 and 40# blocks at $1.8100. The weekly average for barrels is $1.8240 (+0.0560) and blocks, $1.7640 (-0.0210). NONFAT DRY MILK: Grade A closed at $1.5375. The weekly average for Grade A is $1.5310 (+0.0370). DRY WHEY: Extra grade dry whey closed at $0.6175. The weekly average for dry whey is $0.6060 (+0.0055). CHEESE HIGHLIGHTS: Cheesemakers reported spot milk prices from $1.00 under Class to $.25 over Class in the Midwest. Spot milk trading was fairly quiet in general, and Northeastern cheese producers say there are pockets of tightness regarding milk availability. Cheese production generally has been somewhat busy, despite reports of employee shortages and other logistical snags growing in regularity in recent months. Demand notes ring true across the regions. Retail demand has strengthened seasonally, across the board. CME prices have thrown a curveball at market participants. After a notable gap between block and barrel cheese prices for months, where block prices clearly outpaced those of barrels, the prices have now inverted. Barrel prices late last week and throughout this week have been higher than blocks. Cheese contacts in the Western region do relay block inventories are more available than barrels. BUTTER HIGHLIGHTS: Cream is tight in the East region, while availability varies in the West. Following a fire at a butter plant in the Northwest, cream has been diverted to other nearby production facilities. In the Northeast some churns are, reportedly, idle this week as cream clears to holiday-related processing lines. Butter producers in the West and Central regions are running shorter schedules due to labor shortages. Demand for butter is strong. While inventories or butter are available in the Northeast and West, some purchasers are buying early in anticipation of the upcoming holiday season. In the Central region plant managers are focused on resolving ongoing hauling/logistical issues. Bulk butter overages range from 2 to 10 cents above market this week. FLUID MILK: In most areas of the nation, milk production is increasing off farms. There are reports milk availability is slightly tight in areas of the Northeast. Manufacturers of milk output is up in parts of the West region, although Pacific Northwest fluid milk contacts relay milk supplies are somewhat lighter. Bottling demands are mostly steady. Seasonal retail products, like eggnog and aerated cream, have increased production schedules for customers’ demands. Cream markets are stable. Internal cream supplies are meeting the needs of some end users. Cream prices have increased in the Central and Eastern region. Condensed skim availability/volumes are steady to lighter in the country. F.O.B. cream multiples are 1.32-1.45 in the East, 1.31-1.39 in the Midwest, and 1.05-1.35 in the West. DRY PRODUCTS: Low/medium heat nonfat dry milk (NDM) prices heightened in all regions. Western industry contacts note international demands are strengthening. Spot load availability is mixed in the United States. High heat prices are mostly higher. NDM markets are bullish. Dry buttermilk prices moved higher. A plant fire in the Western region has created some unsettledness, as buttermilk solids/powders were fairly limited even before the incident. Dry whole milk prices are steady on limited trading activity. Dry whey prices are mixed. International interests remain healthy, but port/freight congestion are impacting potential export opportunities. Whey protein concentrate 34% prices are steady to slightly higher on the top of the range. WPC34% markets are steady to firming. Lactose prices are steady to slightly lower. Demand for carbohydrates is noted as unstable. Casein prices are currently steady on steady to bullish market tones. ORGANIC DAIRY MARKET NEWS: Federal Milk Market Order 1, in New England, reports utilization of types of organic milk by pool plants. During September 2021, organic whole milk utilization totaled 14.1 million pounds, up from 12.4 million pounds the previous year. Butterfat content, 3.30 percent, improved from the 3.29 percent the previous year. The September 2021 utilization of organic reduced fat milk, 16.2 million pounds, declined from the 17.3 million pounds a year earlier. The butterfat content for organic reduced fat milk, 1.40 percent, declined from 1.55 percent the previous year. Total organic dairy retail advertisements declined 34 percent this week. By commodity, retailers announced fewer ads for organic milk, –39 percent, and organic yogurt, –21 percent. By pack size, organic yogurt 32-ounce retail ads declined 61 percent, 16-ounce organic butter ads dipped 50 percent and organic half gallon milk retail ads fell 36 percent. The Northwest and Hawaii were the only regions to expand organic dairy ads, 25 and 100 percent, respectively. NATIONAL RETAIL REPORT (DMN): Total conventional dairy ads increased 9 percent from last week, but organic dairy ads are down 34 percent. Ads for conventional ice cream in 48- to-64-ounce containers are up 10 percent from last week. The national weighted average advertised price for conventional ice cream in 48-to-64-ounce containers is $3.02, 13 cents less than last week. The national weighted average advertised price for butter in a 1-pound package is $3.21, up 36 cents from $2.85 last week. SEPTEMBER MILK PRODUCTION (NASS): Milk production in the 24 major States during September totaled 17.3 billion pounds, up 0.4 percent from September 2020. August revised production, at 17.9 billion pounds, was up 0.7 percent from August 2020. The August revision represented a decrease of 75 million pounds or 0.4 percent from last month's preliminary production estimate. Production per cow in the 24 major States averaged 1,937 pounds for September, 4 pounds below September 2020. The number of milk cows on farms in the 24 major States was 8.93 million head, 48,000 head more than September 2020, but 22,000 head less than August 2021. Milk production in the United States during the July - September quarter totaled 55.9 billion pounds, up 0.9 percent from the July - September quarter last year. The average number of milk cows in the United States during the quarter was 9.45 million head, 48,000 head less than the April - June quarter, but 74,000 head more than the same period last year. NOVEMBER ADVANCED CLASS PRICES BY ORDER (FMMO): The base Class I price for November 2021 is $17.98 per cwt, an increase of $0.90 per cwt when compared to October 2021. A Class I differential for each order's principle pricing point (county) is added to the base price to determine the Class I Price. For November 2021, the advanced Class IV skim milk pricing factor is $10.53 per cwt, the Class II skim milk price is $11.23 per cwt, and the Class II nonfat solids price is $1.2478 per pound. The two-week product price averages for November 2021 are: butter $1.7436, nonfat dry milk $1.3497, cheese $1.7624, and dry whey $0.5385. Information for the period October 18 - 22, 2021, issued weekly Published by: Dairy Market News - Madison, WI JESSICA MUELLER, 608-422-8589 Email: jessica.mueller@usda.gov Additional Dairy Market News Information: Dairy Market News (DMN) by Phone: (608)422-8602 DMN Website: https://www.ams.usda.gov/market-news/dairy DMN MARS (My Market News): https://mymarketnews.ams.usda.gov