MD_DA431
DA
MD DA431 BUTTER - CENTRAL 

MADISON, WI. December 9, 2015 (Report 49)

CENTRAL BUTTER 

Churn operators indicated they are hesitant to take in any spot cream 
loads that don't have butter orders attached to them. Butter makers 
are continually balancing orders and existing inventories as the 
market cliffhanger continues. Market participants saw an 11.25 cents 
decline on CME Group trading through midweek compared to last Friday's 
close. This is viewed as a good start to market correction, but most 
indicate they expect further declines in the near term. Sellers report 
demand for butter is weak as holiday related orders are already on the 
books. Buyers are not interested in going long on orders due to the 
expectation that prices will follow historical trends at some point 
and decline sharply ahead of the holidays. Butter production is mostly 
lower as butter makers set limits on the number of spot cream loads 
they are willing to take this week. Cream loads from the East and West 
regions are clearing into the Central region to find processing room. 
The CME Group monthly average price for Grade AA butter during 
November was $2.8779, compared to $1.9968 a year ago. The NASS Dairy 
Products report noted October U.S. butter production totaled 147.5 
million pounds, down 1.7 percent from a year ago. January-October 
cumulative U.S. production totals 1.521 billion pounds, 1.4 percent 
behind 2014 during the same time span. October production in the 
Central region totaled 59.6 million pounds, 5.1 percent lower than 
last year. The DMN National Retail Report-Dairy for December 4-10 
noted the national weighted average advertised price for a 1 pound 
package of butter was $3.29, up $0.45 from a week ago, and $0.01 
higher than a year ago. The weighted average price in the Midwest 
region was $2.68, and in the South Central region, $3.15. The CME 
Group Grade AA butter market closed Wednesday at $2.7900. This is down 
16.5 cents from last Wednesday. Bulk butter prices range from 4 cents 
under to 7 cents over the market, based on CME Group prices and 
various indices. 

2015 U.S. Butter and Milkfat Exports (USDA-FAS)

                 2015 Exports      % Change From 
                 (Million Lb.)       1 Year Ago

October Total        2.0            - 57
TOTAL, JAN - OCT     44.0             - 69

 1 Saudi Arabia      16.6             - 48
 2 Mexico             8.5             + 5
 3 Canada             5.5             + 2
 4 South Korea        2.9             - 13
 5 Iran               1.2             - 92

1530CT Janet.Linder@ams.usda.gov 608.557.7003
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