MD_DA650                                                                        
DA                                                                              
MD DA650 Nonfat Dry Milk - Central and East                                     

MADISON, WI.  July 21, 2016 (REPORT 29)                                         

NONFAT DRY MILK - CENTRAL AND EAST                                                                                                                      

CENTRAL: Low/medium heat nonfat dry milk prices are lower at both ends of 
the price range series while the mostly series holds steady. Sellers 
motivated to move spot loads of low/medium heat NDM are willing to lower 
their price point, pulling the price range lower. Production is steady to 
slightly lower in the Central region. As milk production declines 
seasonally, some manufacturers are choosing to redirect milk away from the 
dryers and into production of other commodities. Demand is mixed. Some 
market participants feel buyer interest is only present when offers are made 
at the lower end of the market. Other contacts report steady sales at or 
above the current market. Buyers continue to honor contracts. Many industry 
contacts feel a large portion of interest in the low/medium heat market 
stems from international buyers. Inventories are generally long. Lackluster 
market interest is leaving some market participants with large stocks on 
hand. Several manufacturers report building inventories. The market 
undertone is mixed. High heat nonfat dry milk prices are higher this week. 
Changes on contract indices pulled prices higher. Production is limited and 
high heat NDM dryer runs are mostly scheduled to meet contractual needs. 
Because production is mainly on an as needed basis, inventories are tight. 
The market undertone is firm.  
EAST: Eastern low/medium heat nonfat dry milk prices adjusted lower in the 
range on active f.o.b. spot sales and bulk trading, but remained steady in 
the mostly series. Domestic interest is moderate as traders maintain a hand-
to-mouth system of purchasing. Manufacturing plants are still running full 
as low/medium nonfat dry milk output levels correlate with seasonally heavy 
condensed skim supplies. Manufacturers are adding new production to sizeable 
inventories. The NDM export market is ongoing, with strong interest from 
Mexico, as recent results from the Global Dairy Trade auction posted a drop 
in SMP pricing. The market undertone is mixed. Prices for high heat nonfat 
dry milk are higher, prompted by index adjustments and market indicators. 
East market sources report tight supplies. Manufacturers, in general, find 
it challenging to schedule dryer time due to the volume of condensed skim on 
hand, resulting in irregular production episodes. Moderate interest is 
increasing, in a strengthening the market. Wednesday at the CME Group, Grade 
A NDM closed at $0.8625, down $0.0075 cents from last Wednesday.  

F.O.B. CENTRAL/EAST:  Includes EXTRA GRADE and GRADE A                          
LOW/MEDIUM HEAT:   .7800 - .9300          MOSTLY:   .8500 - .8900               
HIGH HEAT:         .9300 - 1.0200                                               

1100CT daniel.johnson@ams.usda.gov/Amy.L.Schmitz@ams.usda.gov
USDA/AMS/Dairy Market News, Madison, Wisconsin (608)557.7006
Dairy Market News website: http://www.ams.usda.gov/market-news/dairy
Dairy Market News database portal: http://www.marketnews.usda.gov/mnp/da-
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