MD_DA650                                                                        
DA                                                                              
MD DA650 Nonfat Dry Milk - Central and East                                     

MADISON, WI.  May 12, 2016 (REPORT 19)                                          

NONFAT DRY MILK - CENTRAL AND EAST                                              

CENTRAL: In the Central region, low/medium heat nonfat dry milk 
prices are mostly higher. Prices on some auction sites moved 
incrementally higher while other indices used for variable contract 
pricing shifted lower. Contracted loads are clearing on time, with 
price structures intact. Manufacturers report that spot interest is 
price sensitive. Resellers, too, note their buyers limit interest to 
offers carrying a discount to the current market. Buyers/end users 
view the current production trends as lending a bearish tone to the 
marketplace. Manufacturers indicate low/medium heat NDM production is 
ongoing and at peak output at most regional plants. Some milk intake 
volumes are clearing the separators, but after that, cream is moving 
on to further processing while some of the nonfat solids are shipping 
out for disposal. Low/medium heat NDM inventories are building in the 
Central region. Central high heat NDM prices are steady. With 
intermittent production at many facilities, high heat NDM inventories 
are manageable to tight. Many sales are contract based. The NASS 
Dairy Products report noted U.S. human NDM production during March 
2016 in the Central region totaled 30.5 million pounds, 9.9 percent 
higher than one year ago. Total U.S. human NDM production during 
March 2016 was 171.6 million pounds, 5.1 percent lower than last 
year. During January-March 2016, U.S. human NDM production totaled 
448.9 million pounds, 10.1 percent less than the same time span in 
2015. Total U.S. NDM, human, month ending stocks for March were 231.9 
million pounds, 7.5 percent below a year ago.
EAST: Prices for low/medium nonfat dry milk (NDM) increased this 
week. Sources note that most manufacturers are firm on prices, as 
they feel confident in their position. Some market participants noted 
pressure to lock up bids as NDM prices moved unexpectedly higher. 
With heavy milk intakes, low/medium NDM production volumes remain 
high. Reports indicate that condensed skim loads are available at a 
discount to Class II manufacturing. In addition, there are signs that 
excess condensed skim loads are continuing to be discarded. East high 
heat nonfat dry milk price are steady. Production is intermittent, as 
inventories are adequate to tight. Most sales remain contract based, 
as near-term commitment are being met.
DAIRY PRODUCTS:  According to NASS, the Atlantic region's production 
of human nonfat dry milk in March 2016 totaled 32.8 million pounds, 
10.8% more than a year ago and 19.7% more than the previous month.  
The March 2016 U.S. production of skim milk powder, totaled 40.6 
million pounds, 2.8% more than a year ago and 0.9% more than the 
previous month.   
F.O.B. CENTRAL/EAST:  Includes EXTRA GRADE and GRADE A                          
LOW/MEDIUM HEAT:   .7200 - .8300          MOSTLY:   .7550 - .8000               
HIGH HEAT:         .8800 - .9700                                                

1100CT Daniel.Johnson@ams.usda.gov/Janet.Linder@ams.usda.gov
USDA/AMS/Dairy Market News, Madison, Wisconsin (608)557.7003
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