MD_DA840                                                         
DA                                                               
MD DA840 Cheese - West                                           

MADISON, WI.  September 06, 2017 (REPORT 36)                     

WEST CHEESE                                                      

Western cheese production is active. Plenty of milk is still finding its way into cheese vats. Industry contacts describe domestic demand as steady or solid, however some seem to indicate a short term lull on either side of the last summertime holiday weekend. Food service demand is picking up slightly as schools resume fall terms. Inventories are larger than typical, but some market participants feel this is a new norm for cheese markets. International buyers are watching U.S. cheese market prices closely. As the price fluctuates, so does their level of interest in making purchases. The DMN National Retail Report-Dairy for the week of September 1-7 shows the U.S. weighted average advertised retail price for an 8 ounce pack of natural shredded cheese is $2.29, down $.06 from last week. Packs average $2.45 in the Southwest and $2.49 in the Northwest. One year ago, the national price was $2.19. For 8 ounce blocks, the U.S. price is $2.11, down $.23 from last week. Blocks average $2.20 in the Southwest and $2.49 in the Northwest. One year ago, the national price was $2.17. In the West, wholesale prices were down $.1625 for process, and down $.1700 for cheddar block, cuts, and Monterey Jack. Swiss cut wholesale prices are up $.1000. This week, a cooperative export assistance program accepted requests for export assistance on contracts to sell 793,664 pounds (360 metric tons) of cheese. So far this year, the program has assisted member cooperatives who have contracts to sell 48.3 million pounds of cheese in export markets. Dairy Products (NASS) reports July 2017 U.S. total cheese production, 1.03 billion pounds, is 0.3 percent below June 2017. Total 2017 U.S. cheese production, year to date through July is 7.203 billion pounds, 2.5 percent above January through July 2016. In the West, total cheese production for July 2017 was 435.2 million pounds, 0.1 percent more than last month. For total cheese production and various types of cheese, July 2017 U.S. and West cheese production percent changes compared to July 2016 are as follows:

July Production 2017 vs 2016    U.S.       West
Total Cheese                  + 1.0       - 0.8
American                      + 0.2       - 4.3
Cheddar                       + 0.8       - 6.4
Total Italian                 + 1.2       + 1.4
Mozzarella                    + 1.1       + 1.4
Swiss                         - 2.3         ...

The CME Group August 2017 monthly average price for barrels, $1.5993, is up from the July 2017 monthly average of $1.4396, but down from the monthly average of a year ago, $1.8110. Blocks? August average price, $1.6852, is up from the $1.6586 July monthly average, but down from $1.7826 one year ago. In CME Group trading Wednesday, barrels closed at $1.5800, up $.0800 from a week ago and blocks closed at $1.6400, up $.1200. 

WHOLESALE SELLING PRICES:  DELIVERED, DOLLARS PER POUND          
(1000 - 5000 POUNDS MIXED LOTS)                                  
                                                                 
Process 5# Loaf                              : 1.5825-1.8400     
Cheddar 40# Block                            : 1.6550-2.1000     
Cheddar 10# Cuts                             : 1.8350-2.0550     
Monterey Jack 10#                            : 1.8450-2.0050     
Grade A Swiss Cuts 6 - 9#                    : 2.8500-3.2800     

1530CT Mike.Bandli@ams.usda.gov 608-422-8592
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