MD_DA650                                                                        
DA                                                                              
MD DA650 Nonfat Dry Milk - Central and East                                     

MADISON, WI.  August 18, 2016 (REPORT 33)                                       

NONFAT DRY MILK - CENTRAL AND EAST                                              
                                                                               
CENTRAL: Low/medium heat nonfat dry milk prices are mixed this week. Some 
industry contacts moved loads of low/medium heat NDM at prices at the low 
end of the range in an effort to relieve some inventory pressures. Fresh 
production loads continue to move at market overages. Buyers seeking 
specific brands of low/medium heat NDM are willing to pay premiums. Falling 
milk production in the Central region has slowed low/medium heat NDM 
production for several manufacturers. Domestic demand is steady. Some market 
participants describe the current demand as lackluster. International 
interest is strong. Exports continue to be a large portion of many contacts' 
sales. Inventories are mostly long. The market undertone is mixed. High heat 
nonfat dry milk prices are lower on the bottom end of the price range series 
but hold steady on the top. Changes on contract indices pulled prices lower 
in several instances. High heat NDM production is intermittent and mostly 
based on contractual needs. Most manufacturers report little to no spot 
market availability. Inventories are tight. The market undertone is mixed. 
EAST: Prices for low/medium heat nonfat dry milk are mixed. Class I demand, 
due to school openings, affects overall low/medium heat nonfat dry milk 
production in the region. As a result, manufacturing milk supplies have 
decreased significantly with the bulk of condensed skim moving through 
contracts. Some producers see slight reductions in inventories as they focus 
managing inventory volumes based on future sale considerations. In some 
instances, producers prefer to hold stocks and only offer spots at the high 
end of the range. Buyers' preference and availability continue to widen the 
spread. Domestic demand is active, with a number of transactions occurring 
this week through various buying channels. As well, sales to Mexico are 
good. The market undertone, while unsettled, is seeing some firmness. Prices 
for high heat nonfat dry milk moved lower at the bottom of the range but 
higher at the top on limited f.o.b. spot sales. Regional contacts report 
high heat NDM production as little to none at this point. The plans of some 
manufacturers entail completing needed maintenance projects prior to their 
implementing production schedules that meet forthcoming seasonal needs. In 
general, the market undertone is unsettled. Wednesday at the CME Group, 
Grade A NDM closed at $0.8650, up $0.0200 from last Wednesday. 
F.O.B. CENTRAL/EAST:  Includes EXTRA GRADE and GRADE A                          
LOW/MEDIUM HEAT:   .8000 - .9500          MOSTLY:   .8500 - .9000               
HIGH HEAT:         .8800 - 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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