MD_DA440  
DA 
MD DA440 BUTTER - WEST 

MADISON, WI.  January 4, 2017 (REPORT 1)

WEST BUTTER

Western butter production is active. Coming out of the winter holidays, butter 
inventories are tighter and market prices are strong. Domestic butter demand has 
backed off a little from the pre-holiday pull, but is still seasonally strong and 
steady. Butter makers are using a variety of marketing strategies to use the 
available cream. A number of the manufacturers are actively churning to make use 
of the cream in their possession, but are not eager to buy additional loads of 
cream. A few other processors are working to sell off any extra cream into other 
markets. Much of the production focus is on making bulk butter. There are also a 
few manufacturers starting to plan print butter runs for the spring holidays. 
Bulk butter pricing in the West this week is 2 cents under to 5 cents above, 
based on the CME Group with various time frames and averages used. The DMN 
National Retail Report-Dairy for the week of December 30-January 5 found that the 
U.S. weighted average advertised price of 1 pound butter is $2.69, up $.09 from 
last week. The U.S. weighted average price was $3.00 one year ago. There were no 
reported sale prices for conventional 1 pound butter in either the Northwest or 
Southwest. According to the California Department of Food and Agriculture, 
November 2016 butter production was 42.4 million pounds, down 6.9% from a year 
ago. California year-to-date butter production through November is 512.6 million 
pounds, down 3.1% from 2015 butter production through November. The CME Group 
December 2016 monthly average price for AA butter, $2.1763, is up from the 
November monthly average of $1.9899. One year ago the CME Group monthly average 
was $2.3318. The Grade AA butter price at the CME Group on Wednesday closed at 
$2.2600, down $.0500 from a week ago.


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