The April Federal order Class III milk price was announced at $15.50 per hundredweight, down 84 cents from March and $3.02 below April 2023. The four-month average stands at $15.77, down from $18.46 a year ago.

Monday’s Class III futures settlements portend a May price at $18.43; June, $19.45; and July at $19.43, with the June price being the peak for 2024.

The April Class IV is $20.11, up 2 cents from March, $2.16 above a year ago, and the highest Class IV since Nov. 2023. Its four month average is at $19.86, down from $18.80 a year ago.

Churns kept busy

You’ll recall March milk production was down 1.0% from a year ago and the March Dairy Products report shows where that milk was directed.

Cheese production climbed to 1.226 billion pounds, up 7.6% from February but only 0.1% above March 2023. Production for the first three months of 2024 totaled 3.6 billion pounds, up just 0.1% from 2023.

Italian cheese output was up 4.4% from a year ago and year to date was up 3.2%. American was down 2.9%, with YTD production down 4.2%. Mozzarella was up 6.8% from a year ago and YTD was up 3.7%.

Cheddar output shot up to 343.3 million pounds, up 28.7 million or 9.1% from the February level, which was revised up 9.7 million pounds, but was down 12.1 million pounds or 3.4%, from a year ago. YTD Cheddar is at 988.4 million pounds, down 5.9%.

Butter production climbed to 208.5 million pounds, up 10.9 million pounds or 5.5% from February, and up 2.7 million pounds or 1.4% from a year ago. YTD butter is at 623.4 million pounds, up 4.5% from 2023.

Yogurt production was down 0.4% from a year ago and YTD was up 2.0%.

Dry whey crept to 79.9 million pounds, up 2.6 million pounds or 3.4% from a year ago. YTD whey hit 229.8 million pounds, up 4.1%. Stocks grew to 81.3 million pounds, up 14.7 million pounds or 22.1% from a year ago.

Nonfat dry milk output, at 183.7 million pounds, was down 15.7 million pounds or 7.9% from a year ago. YTD powder was at 469.1 million pounds, down 15.1%. Stocks were down a whopping 59.8 million pounds or 20.4% from 2023.

Skim milk powder production dropped to 28.3 million pounds, down 20.2 million or 41.7% from a year ago. YTD SMP was at 121.5 million pounds, down 20.2% from 2023.

Butter tops $3

Like a beach ball held under water, butter popped back above $3 last Wednesday and closed Friday at $3.0750 per pound, highest since Nov. 3, 2023, 10.50 cents higher on the week, and 63 cents above a year ago. There were 43 trades last week and 90 for the month of April, up from 53 in March.

Monday’s butter was unchanged but it dropped 5.25 cents Tuesday on a trade, dipping to $3.0225.

“Bulls continue to lead the charge on butter,” says Dairy Market News, but cream availability remains “wide open.”

Western butter output is also strong as cream availability is “comfortable.” Some butter makers are securing additional loads for churning to build stocks for anticipated third and fourth quarter demand.

Block Cheddar saw its Friday finish at $1.79 per pound, up 4 cents on the week, sixth week of gain and 17.75 cents above a year ago. The barrels finished 10.75 cents higher at $1.88, highest since March 29, 2023, and 35 cents above a year ago

Sales totaled 2 cars of block on the week and 113 for April, up from 83 in March. Barrels totaled 9 for the week and 82 for the month, up from 62 in March.

The blocks gained a nickel Monday on a sale, hitting $1.84, highest since Sept. 19, 2023, but a trade Tuesday took it back a quarter-cent, to $1.8375.

The barrels inched a quarter-cent higher Monday on 3 trades but were offered a quarter-cent lower Tuesday, slipping back to $1.88

Cheese demand continues to strengthen, according to Midwest cheesemakers who are beginning to turn away customers and tell current customers that requests for extra volumes will not be possible. Barrel makers say any extra is spoken for. Milk availability has begun to tighten.

Cheese production also remains strong in the West. Milk is ample but may soon tighten. Demand from domestic purchasers is stronger and steady from international buyers.

Grade A nonfat dry milk closed Friday at $1.13 per pound, up 2 cents on the week, but 6.75 cents below a year ago. Sales totaled 12 on the week and 49 for April, one more than the month before.

Monday’s powder was offered 0.75 cents lower and a trade took it down another 0.75 cents Tuesday, to $1.1150.

Dry whey saw its Friday close at 39.50 cents per pound, 1.25 cents higher on the week, highest since April 1, and 6.75 cents above a year ago. There were 11 sales on the week and 66 for April, highest monthly total since October 2023’s 195, and up from just 8 in March.

The whey was down 1.25 cents Monday on 3 sales and stayed there Tuesday at 38.25 cents per pound.

Exports slip

March U.S. dairy exports took a hit following an increase in February. Sailings totaled 527 million pounds valued at about $740 million, down 4.5% in volume and down 9.2% value, according to the May 2 “Daily Dairy Report.”

HighGround Dairy economist Betty Berning reported in the May 8 “Dairy Radio Now” broadcast this was the smallest March total since 2020. Volumes to the top three markets dropped significantly, down 22% to Mexico, down 27% to China, and 4.9% less to Japan. But, exports to Canada and South Korea saw notable increases of 27% and 74%, respectively, and exports to Southeast Asia grew for a second month, up 4%.

Nonfat dry milk exports tumbled 18.4% as shipments to Mexico were down 37%. Dry whey exports were down 22.3%, as China continues to restrain purchases. Butter exports were down 42.4%.

The bright spot was record cheese exports, with 110.3 million pounds leaving our shores, up 20.5% from March 2023. Berning said that March bested the previous record set in June 2022, thanks to increased sales to Mexico, South Korea, and Japan.

GDT up 1.8%

Trading was a little brighter in Tuesday’s Global Dairy Trade Auction where the weighted average was up 1.8%, following a meager 0.1% increase on April 16.

Cheddar led the gains, up 8.0%, following an 8.5% drop on April 16. Mozzarella was up 2.3%. Whole milk powder was up 2.4%, after inching 0.4% higher last time. Skim milk powder was up 0.4%, after holding steady, and buttermilk powder was up 1.7%. Butter was up 2.1%, after falling 1.4%, and anhydrous milkfat was up 1.2%, following a 1.7% gain. Lactose was the only loss, down 1.3%, after dropping 1.3% on April 16.

StoneX says the GDT 80% butterfat butter price equates to $2.9174 per pound U.S., up 2.1 cents from April 16, and compares to CME butter which closed Tuesday at $3.0225. GDT Cheddar, at $1.9310, was 12.9 cents, and compares to Tuesday’s CME block Cheddar at $1.8375. GDT skim milk powder averaged $1.1570 per pound, up from $1.1524, and whole milk powder averaged $1.5194 per pound, up from $1.4830. CME Grade A nonfat dry milk closed Tuesday at $1.1150 per pound.

Feed ratio inches higher

A higher All Milk Price and lower soybean and hay prices nudged the March milk feed price ratio higher for the second month in a row. The latest Ag Prices report shows the ratio at 2.17, up from 2.13 in February, and compares to 1.55 in March 2023.

The All Milk Price averaged $20.70 per hundredweight (cwt.), up a dime from February, but 30 cents below March 2023.

The national corn price averaged $4.36 per bushel, unchanged from February, but $2.31 below a year ago.

Soybeans averaged $11.80 per bushel, down a dime from February, and $3.10 below a year ago.

Alfalfa hay slipped to $195 per ton, down $5 per ton from February and $71 below a year ago.

The February average cull price for beef and dairy combined jumped to $119 per cwt., up $10 from February, $23.30 above March 2023, and $47.40 above the 2011 base average.

Quarterly milk cow replacements averaged $2,120 per head in April, up $230 from January, and $400 above April 2023.