Wednesday, May 19, 2010


(click on image to enlarge)

The latest "Livestock Dairy and Poultry Outlook" is available from USDA ERS at:

Domestic commercial use is expected to increase this year. A robust 1.2 percent
increase is expected in commercial use on a fats basis while growth in use on a
skims-solids basis is projected at a slight 0.4 percent rise. Stocks should tighten as use increases. Despite the improved demand outlook, prospects are for only modest
price increases in 2011.

Cheese prices are forecast to trend higher both this year and next, averaging $1.480
to $1.530 per pound this year and $1.505 to 1.605 per pound in 2011. Higher prices
are also expected for NDM and whey for the balance of 2010 and into 2011. NDM
prices are forecast to average between $1.180 and $1.220 per pound in 2010 and to
climb to average $1.210 to $1.280 per pound next year. Strong exports of whey
products will raise prices to average 36.5 to 39.5 cents per pound this year, and they will rise slightly to average 37.5 to 40.5 cents per pound in 2011. Butter counters the trend; while prices will average higher this year compared with last year, $1.445 to $1.525 per pound, 2011 prices are forecast lower at $1.390 to $1.520 per pound. Butter prices are forecast lower next year because the higher butter prices forecast for the second half of 2010 are not expected to be repeated next year.

The cheese price will have to rise dramatically to meet the expectations of the report. The CME block price has averaged $1.41 per pound at the same time the international (New Zealand) price has averaged $1.81 per pound.

Those "market forces" are so very tricky.


  1. This just seems to me to be the USDA informing the processors what price levels they will accept without question.

    Steve Barton

  2. Isn't it about time for certain cheese companies to bid the market down again? They've been kinda quiet since you and Pete outed them.