MD_DA830                                                         
DA                                                               
MD DA830 Cheese - Midwest                                        

MADISON, WI.  January 13, 2016 (REPORT 2)                        

MIDWEST CHEESE:     

This week, mozzarella production has notched up to sustain post-holiday frozen pizza 
production demand. Cheese manufacturing is back closer to normal schedules, with less 
spot milk now available. The arrival of the coldest weather of this winter in the Upper 
Midwest has brought disruptions to cheese manufacturing. Broken water mains have 
temporarily affected some cheese production, sending milk out to find other 
manufacturers. A few incidents of milk trucks not starting have affected the flow of milk 
from some producers to cheese plants. The year opens with uncertainty hanging over cheese 
markets. The retrospective on last year is surprise, but relief, that the unanticipated 
higher cheese production was successfully absorbed. However, global milk supplies for 
2016 are looking like they will also be strong, at least in the U.S. and the EU. Oceania 
is in the middle of summer, with hot and increasingly dry conditions in some milk 
regions, leaving milk volumes there more uncertain. Higher milk volumes domestically and 
in the EU will likely keep cheese volumes strong and global export competition active. 
Thus, the significant question hovering over early 2016 is whether markets will continue 
to absorb volumes of cheese without prices being adversely affected. The DMN National 
Retail Report-Dairy shows that January 8-14 Midwest ads for 8 ounce shred cheese have a 
weighted average advertised price of $1.94, 23 cent lower than the national average. 
Midwest prices range from $1.50-$2.50. One year ago, the national price was $2.54. For 8 
ounce blocks, the Midwest average price is $1.89, 30 cents below the national average 
price. Midwest ads are priced from $1.50-$2.50. Last year, the national price was $2.33. 
Midwestern wholesale prices are unchanged for Swiss cuts, up $.0150 for process, and up 
$.0250 for all other types. In CME Group trading Wednesday, barrels closed at $1.5200, up 
$0.0400 from last Wednesday and blocks closed at $1.4950, up $0.0250. 
                                            
WISCONSIN WHOLESALE SELLING PRICES:  DELIVERED,                  
DOLLARS PER POUND (1000 - 5000 POUNDS MIXED LOTS)                
                                                                 
Process American 5# Loaf                   : 1.6000-1.9600       
Brick And/Or Muenster 5#                   : 1.8575-2.2825       
Cheddar 40# Block                          : 1.5850-1.9800       
Monterey Jack 10#                          : 1.8325-2.0375       
Blue 5#                                    : 2.1250-3.1125       
Mozzarella 5 - 6# (Low Moisture, Part Skim): 1.6575-2.5975       
Grade A Swiss Cuts 6 - 9#                  : 2.6875-2.8050       

1300CT eric.graf@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