MD_DA650                                                                        
DA                                                                              
MD DA650 Nonfat Dry Milk - Central and East                                     

MADISON, WI.  May 26, 2016 (REPORT 21)                                          


NONFAT DRY MILK - CENTRAL AND EAST                                              
                                                                                
CENTRAL: Low/medium nonfat dry milk prices are higher this week in 
the Central region. Changes on contract indices pulled prices higher 
in several instances. Production is active in reaction to heavy farm 
milk intakes. Many industry participants have adequate supplies of 
nonfat dry milk. Few buyers are looking for NDM on the spot market. 
Therefore, minimal transactions were carried out this week outside of 
contracts. A few contacts noted that condensed skim is being offered 
at large discounts and some processors may turn to that in lieu of 
NDM. Prices trended downward Monday thru Wednesday on the CME Group, 
following a short-lived upturn in price the end of last week. The 
market undertone is mixed. High heat NDM production is steady this 
week. Most manufacturers are scheduling high heat runs on an as 
needed basis. However, some contacts speculate manufacturers may 
start to produce more high heat NDM in the coming months to meet 
anticipated growth in demand for Q3/Q4. The market undertone is 
steady.
EAST: In the East region, low/medium heat nonfat dry milk prices 
advanced incrementally higher in the mostly price series on f.o.b. 
spot sales transactions. The impact of the Memorial Day holiday is 
increasing the volume of condensed skim available for processing, as 
Class I milk supplies divert to balancing. As a result, over the 
holiday weekend, condensed skim supplies could drive low/medium heat 
nonfat dry milk production to capacity levels for regional dryer 
operations. As output expands, sources point out inventories are 
building; however, those volumes are needed for future contract 
commitments, as a few buyers hedge. Good sales activity over the past 
few weeks lowered uncommitted supplies available for cash sales. The 
export market is fair to steady. In general, the low/medium heat NDM 
market currently resonate a firm undertone. Wednesday at the CME 
Group, Grade A NDM closed at $1.7700, down $0.0300 cents since last 
Wednesday. Prices for high heat nonfat dry milk are steady. Most 
manufacturers are bypassing high heat NDM production this week as 
dryer time centers on low heat NDM production in managing heavy 
condensed skim supplies. High heat NDM stocks are adequate for near-
term customer needs. Limited supplies are available for cash trading. 

F.O.B. CENTRAL/EAST:  Includes EXTRA GRADE and GRADE A                          
LOW/MEDIUM HEAT:   .7700 - .8400          MOSTLY:   .7800 - .8100               
HIGH HEAT:         .8900 - .9700                                               

1100CT Daniel.Johnson@ams.usda.gov/Amy.L.Schmitz@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