MD_DA650 DA MD DA650 Nonfat Dry Milk - Central and East MADISON, WI. April 07, 2016 (REPORT 14) NONFAT DRY MILK - CENTRAL AND EAST CENTRAL: Central low/medium heat nonfat dry milk prices are unchanged to lower and the market tone is weak. Variable contract prices followed movement of indices, while f.o.b. spot load prices moved lower. Manufacturers at some locations are faced with mounting low/medium heat NDM inventories as milk intakes climb seasonally. Buyers are looking for loads with price as the first consideration as availability is assumed to be immediate. Brokers are watching the market closely for the next opportunity to take on additional inventories. Market participants report blocks of loads are being offered from some manufacturers, with price discounts to the current market. Low/medium heat nonfat dry milk production is active at most locations throughout the Central region. Class III demand is helping alleviate some of the pressure on drying schedules, but plant operators indicate schedules are close to full. Inventories are building. Central high heat nonfat dry milk prices are unchanged to lower on a weak market. Manufacturers report light demand outside of contract obligations. Bakery accounts are receiving loads to complete orders for upcoming holidays. Production is intermittent and inventories are light as some producers report no spot load availability. The CME Group monthly average price for Grade A NDM during March was $0.7413, compared to $1.0108 a year ago. The DMN monthly average of the mostly price series for Central and East low/medium heat NDM during March was $0.7778, compared to $1.0788 a year ago. The March monthly average of the range price series for Central and East high heat was $0.9724 compared to $1.1785 a year ago. The NASS Dairy Products report noted U.S. human NDM unadjusted production during February 2016 in the Central region totaled 23.8 million pounds, 1.3 percent higher than one year ago. DAIRY PRODUCTS: Total U.S. human NDM unadjusted production during February 2016 was 144.9 million pounds, 3.9 percent lower than last year. During January-February 2016, U.S. human NDM production totaled 281.9 million pounds, 10.7 percent less than the same time span in 2015. Total U.S. NDM human month ending stocks for February were 216.6 million pounds, 10.0 percent below a year ago. EAST: In the East region, low/medium heat nonfat dry milk prices declined through the mostly series. Price adjustments developed from weekly f.o.b. spot sales and pricing indices, as the market drives prices lower. Manufacturers' low/medium heat NDM production runs are active, with heavy output, as milk intakes increase. Condensed skim sales outside of contracts are sluggish, and adds to NDM production output. Sources note that milk deliveries are experiencing short delays when unloading at some plants. Low/medium NDM holdings are substantial at most manufacturing plants and growing. With readily available supplies on hand, the market is seeing offers from brokers and traders, as well as offers from producers. High heat nonfat dry milk prices dropped slightly at the top of the range. Primarily, high heat NDM production runs are limited to accommodate low/medium heat NDM dryer usage. Inventories are adequate on most fronts, while managed around near-term customer needs. The March 22016 DMN monthly average for the Central/East low/medium heat nonfat dry milk range price series is $0.7778 compared to $1.0634 a year ago. Wednesday at the CME Group, Grade A NDM closed $0.6900, down $0.0250 from last Wednesday. The Foreign Agricultural Service (FAS), reports that February 2016 U.S. nonfat dry milk exports totaled 91.2 million pounds, a 16% increase from a year ago. DAIRY PRODUCTS: According to NASS, the Atlantic region's production (unadjusted) of human nonfat dry milk in February 2016 totaled 27.3 million pounds, 1.9% less than a year ago and 6.9% less than the previous month. The February 2016 U.S. production (unadjusted) of skim milk powder, totaled 39.9 million pounds, 23.1% more than a year ago, but 22.1 less than the previous month. F.O.B. CENTRAL/EAST: Includes EXTRA GRADE and GRADE A LOW/MEDIUM HEAT: .7100 - .8325 MOSTLY: .7300 - .7800 HIGH HEAT: .8500 - 1.0200 U.S. NDM Exports, H.S. Code 0402100000(FAS) 2016 Exports % Change From (Million Lb.) 1 Year Ago February Total 91.2 + 16 TOTAL, JAN - FEB 185.7 + 19 1 Mexico 86.2 + 15 2 Philippines 32.0 + 65 3 Indonesia 12.2 + 41 4 Peru 10.6 + 65 5 Vietnam 7.7 + 310 1100CT Daniel.Johnson/Janet.Linder@ams.usda.gov USDA/AMS/Dairy Market News, Madison, Wisconsin (608)557.7000 Dairy Market News website: http://www.ams.usda.gov/market-news/dairy Dairy Market News database portal: http://www.marketnews.usda.gov/mnp/da-home