MD_DA440

     Butter - Western U.S.

     Report 42 - Released on October 16, 2019

     Western butter contacts describe a market currently aflutter. Normally, during this time of
     year, butter makers and butter buyers operate under the idée fixe, to make and purchase
     enough butter to cover Q4 holiday needs. However, industry contacts suggest many end users
     have their Q4 needs covered to the point of being comfortable. Buyers have seemed content to
     hold back on the holiday purchase fervor. There is plenty of butter and cream available.
     Inventories, while getting drawn down along seasonal patterns, are thought to be heavy. Some
     customers suggest that adequate butter availability should redound to lower butter prices,
     or at least, lower bulk butter overages. Bulk butter overages now cover a wide range. In
     contrast, as butter prices on the CME have eased back, a few end users see it as an
     opportunity to lay on coverage for the first half of 2020. Manufacturers say retail butter
     orders have been brisk and this has resulted in active butter churning. In some cases, there
     is a slight bottleneck in processing capacity.


     National Retail Report Dairy – Butter Summary
     Advertised Prices at Major Retail Supermarket Outlets ending during the period of
     10/11/2019 to 10/17/2019

     Butter 1#                       Weighted Average Price
     National                  This Period   Last Week   Last Year
     Conventional                $3.63         $3.94       $3.03
     Organic                     $5.49          n.a.       $4.85

     Prices This Period
     Regional (Conventional)    Wtd. Ave.       Low         High
     Northwest                   $3.59         $3.50       $3.99
     Southwest                   $3.17         $2.49       $3.99
     Prices for: Western U.S., All First Sales, F.O.B., Grade AA, Conventional, and Edible Butter

     Bulk Basis Pricing  - 80% Butterfat $/LB:              -0.0550 - +0.0750


     Information for the period October 14 - 18, 2019, issued weekly

     Secondary Sourced Information:

     CME Closing Price
     The Grade AA butter price at the CME Group on Wednesday closed at $2.1425, compared to the
     weekly average price of $2.0880 from last week.
     Published by:
     Dairy Market News - Madison, WI
     MIKE BANDLI, (608)422-8592
     Email: mike.bandli@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