Cheese prices moved down again today on the CME. Jerome Cheese and Kraft Foods where the sellers.
Dairy pundits have had to revise several times where the supposed the floor for cheese pricing would be found. However, the aspect to watch is probably the volume of futures. Would it be possible for a large company to drive down the cash market and then take positions on the futures market which will then cover their needs for 2010? I think so.
On the other hand butter is rising, probably in anticipation of a higher selling price to build market needs for the Easter season. Butter then may moved down when the seasons needs are sold.
In the meantime just imagine that you are a bank. Just when you thought farm milk prices were going to rise they start to fall again. Will the banks see the shenanigans on the CME as a signal to cut their losses?