MD_DA770                                                                        
DA                                                                              
MD DA770 Lactose - Central and West                                             

MADISON, WI.  March 10, 2016 (REPORT 10)                                        

LACTOSE - CENTRAL AND WEST                                                      

Lactose prices and the lactose market in general have exuded steadiness. This week, 
prices for lactose are mostly steady. The top of the mostly price series inched up 
only slightly as manufacturers continue to push for higher prices. Most processors 
report tight and committed inventories. Some say they have had to turn away a few 
buyers. The short stocks are giving sellers more confidence to ask for a little 
more. Demand has been good, with regular inquiries coming from domestic and 
international markets. Many processors are working on Q2 contracts. Although market 
participants note a general firmness of the lactose market, several ideas create 
headwinds for lactose gains. Industry contacts say there is a psychological barrier 
for lactose prices to advance much above sweet whey powder prices. In addition, 
permeate is not moving well, creating pressures within the permeate/lactose/whey 
complex. The February 2016 Dairy Market News average of the mostly price series for 
Central and West lactose was $0.2166, compared to $0.2061 one month ago and $0.2870 
one year ago. NASS's Dairy Products report shows U.S. lactose production during 
January 2016 totaled 85.1 million pounds, a 5.5% decrease from one year ago. Month 
ending stocks, at 117.3 million pounds, are 10.5% lower than one year ago, but 11.9% 
higher than December 2015. 

Including spot sales and up to 3 month contracts.                               
F.O.B. EDIBLE, NON PHARMACEUTICAL   .1800 - .3200    MOSTLY:   .1950 - .2550    


U.S. Lactose Exports, H.S. Code 1702110000(FAS)
                 2016 Exports      % Change From
                 (Million Lb.)       1 Year Ago

January Total             42.5           + 28

TOTAL, JAN                42.5           + 28
 1 New Zealand            11.3           + 230
 2 China                   6.0           + 23
 3 Mexico                  4.3           - 32
 4 Japan                   4.0           + 379
 5 Indonesia               3.2           + 73

1100CT Mike.Bandli@ams.usda.gov (608) 557-7010
USDA/AMS/Dairy Market News, Madison, Wisconsin
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