MRV BLOG: MRV Market Commentary June 18, 2024

Check-in here to see the MRV commentary on what we have seen and are seeing in the dairy market.  These insights have been developed from MRV’s proprietary data, industry experience, and industry reports referenced below. Here’s our latest:

Domestic

Last month we saw a monumental increase in price, month-over-month (MoM) for both butter and cheese. The latest sales report from USDA follows suit with another increase in butter and cheese, albeit just short of last month’s MoM increase. Block cheese had an increase of 19 cents and barrel cheese had an increase of roughly 23 cents, bringing their prices up to $1.92 and $2.06 respectively. Both volumes had a small increase as well. Butter also had an increase in its (MoM) comparison at about 4.7 cents, bringing it to $3.07. Like cheese, butter sees its volume having a slight increase as well.

Feed

According to USDA’s latest Feed Outlook for 2024-2025, despite trade expectation that called for small cuts in production, yield and an increase in stocks, the US corn crop remained unchanged including its production. Soybean had a similar showing along with its production remaining untouched from May’s estimates. With feed costs continuing to be a concern along with other past and recent farm struggles, this has led many farms to turn to other sources of income. One major source of revenue stream they are looking into and partaking in is retail/branded beef.

Report from Dairy Herd Management

Report from USDA

More Industry News

Recently the whey powder market has rallied, with CME spot market hitting its highest price since late February. From January to April, the output of WPC and WPI (whey protein isolates) reached all-time highs versus same period last year increasing 9.7% and 9.6%, respectively. Dry whey is also seeing some waves in price due to slower production, partially due to moving whey solids to higher protein concentrates, with an impressive 30% increase in its price in less than two months. With Class III being saturated with news on the cheese market, it is important to note that whey has had a supporting role recently with its effect causing Class III values to increase by 66 cents.

Exports

Year to date on a milk solids equivalent basis, dairy exports declined 7% and 2% for its value and volume respectively. However, when comparing to the same period last year, overall exports rose 3%.  Even with the decrease, cheese continues to shine with an astonishing 27% increase in April. Its volume was only beaten by March of this year as the most cheese ever shipped in a single month. Butter exports also spiked up 23% making this the first monthly YoY increase since November 2022.

Report fromUSDEC

Projection

With current commodity standings of butter and cheese increasing quite a bit along with seasonality, MRV forecasts Class I items to increase roughly 8 cents for July 2024 and higher fat items in Class II to also see an increase.

This information cited by MRV Marketing, LLC is for informational and reference purposes only. It is not intended to be a conclusive statement of future market conditions. It is not legal advice or legal documents. The data used in these documents contains references to information created and maintained by other organizations or agencies. Please note that MRV Marketing, LLC does not control and cannot guarantee the accuracy of these outside materials.

Statistical data referenced here is gleaned from reports by MRV Proprietary Data, Daily Dairy Report, USDEC, CME Group, Dairy Herd Management, and USDA.