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Nonfat dry milk (NFDM) continues to be traded (?) on the Chicago Mercantile Exchange (CME). The CME charges a fee for each load traded to both the seller and the buyer.
In 2008 there were a total of 16 loads of Grade A traded on the CME - a real money maker for the Exchange. That works out to 5/100 of a percent of production.
In the real world the real sellers are the big co-ops, such as CDI and LOL. The traders on the CME tend to be brokers, not the manufacturers. The CME sends the price signal heard throughout the land. The signal has everything to do with will of the big players and nothing which could be recognized by Adam Smith as a market.
According to the "Daily Dairy Report" the retail price of milk rose for the third straight month in July. The price of cheese and butter are up. I also understand that butter and cream or in tight supply. The class III milk price fell with this news. There is no shame in robbing the dairy farmer. They are not even covering their tracks now. As a dairy farmer, I know that when the host animal dies so do the parasites. I wonder if those that depend on the dairy farmers existence for a living understand this fact.
ReplyDeleteLucky the NASS uses CME. The California weighted average for last week just came out at $1.1211 on 16 million pounds sold week ending 8/13.
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