MD_DA431
DA
MD DA431 BUTTER - CENTRAL 

MADISON, WI. December 23, 2015 (Report 51)

CENTRAL BUTTER 
					
Central butter production is steady to higher as cream availability 
improves compared to last week. Cream spot loads from the East region 
continue to find processing room in the Central. Balancing plant 
managers are taking in some cream loads at discounted prices, which is 
an incentive for receiving cream in an unsettled market. Butter makers 
indicate the market has them in a quandary. Although butter prices 
have declined from the $2.90s, there is no sure price direction for 
the beginning of 2016. Should stocks be purposely built up and held 
with confidence, or should churn operators lighten holdings before 
prices further deteriorate? Butter makers indicate their strategies 
depend on the size of the operation, risk management opportunities, 
and current buyer interest, to name a few factors. There is not one 
strategy to fit all the butter operations in the Central region. 
Operators are trying to assure customer satisfaction as well as 
economic viability when yearend butter prices are relatively high. 
Currently, retail demand is lower as most shopping for holiday meals 
is complete. Producers are slanting butter production toward food 
service and bulk. The DMN National Retail Report-Dairy for December 
18-24 noted the national weighted average advertised price for a 1 
pound package of butter was $3.10, down $0.09 from one week ago and 
$0.22 lower than a year ago. The weighted average prices in the 
Midwest and South Central regions, respectively, are $2.59 and $2.70. 
The CME Group Grade AA butter market closed Wednesday at $2.0425. This 
is down 3.5 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.

1200CT 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