MD_DA840                                                         
DA                                                               
MD DA840 Cheese - West                                           

MADISON, WI.  July 13, 2016 (REPORT 28)                          

WEST CHEESE                                                      

Western cheese production remains active and strong. Plenty of milk is finding its way 
into cheese vats, even in areas where milk production is seasonally down. Domestic demand 
is good for most types of cheese. Retail cut and wrap cheese sales are solid. And process 
cheese sales are active while the nation is in the midst of grilling season. Cheese 
inventories continue to be long. Many market participants feel a large portion of the 
U.S. cheese stockpile is getting some age on it. Manufacturers are approaching the stocks 
in different ways. A few are trying to push milk into other manufactured dairy product 
production in lieu of producing more cheese. Others are seeking to rotate older commodity 
cheese out by blending with young cheese. In some cases, this is proving more difficult, 
as processors are finding fresh barrels a little harder to acquire. Cheese manufacturers 
are also noting the inverted spread between blocks and barrels, which has been largely in 
place since the end of April. The difference between the block and barrel price is 
prompting a few process cheese producers to make decisions between using blocks instead 
of barrels in the make process. The DMN National Retail Report-Dairy for the week of July 
8-14 shows the U.S. weighted average advertised retail price for an 8 ounce pack of 
natural shredded cheese is $2.30, up $.14 from last week, but down $.04 from a year ago. 
Packs average $2.12 in the Southwest and $1.75 in the Northwest. For 8 ounce blocks, the 
U.S. price is $2.33, up $.10 from last week, and up $.05 from a year ago. Blocks average 
$2.31 in the Southwest and $2.00 in the Northwest this week. In the West, wholesale 
prices are up $.0600 for process, and up $.0175 for cheddar block, cuts, and Monterey 
Jack. Swiss cut wholesale prices are unchanged. This week, a cooperative export 
assistance program accepted requests for 972,239 pounds (441 metric tons) of cheese. So 
far this year, the program has assisted member cooperatives who have contracts to sell 
29.1 million pounds of cheese in export markets. In CME Group trading Wednesday, barrels 
closed at $1.7225, up $.0525 from a week ago and blocks closed at $1.6300, up $.0500. 


WHOLESALE SELLING PRICES:  DELIVERED, DOLLARS PER POUND          
(1000 - 5000 POUNDS MIXED LOTS)                                  
                                                                 
Process 5# Loaf                              : 1.7950-2.0525     
Cheddar 40# Block                            : 1.7075-2.1525     
Cheddar 10# Cuts                             : 1.8875-2.1075     
Monterey Jack 10#                            : 1.8975-2.0575     
Grade A Swiss Cuts 6 - 9#                    : 2.5425-2.9725     


1530CT 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