MD_DA440  
DA 
MD DA440 BUTTER - WEST 

MADISON, WI.  January 11, 2017 (REPORT 2)

WEST BUTTER

Western butter manufacturers are working hard to find the balance between supply and 
demand. Although down from peak demand near the fall and winter holidays, domestic butter 
draws are steady and following seasonal trends. A few industry contacts say current sales 
are exceeding expectations. With ample supplies of cream, butter production is active. 
Some manufacturers are using available cream to rebuild butter inventories. They seem 
eager to put bulk butter into storage for needs later in the year. In other cases, 
processors are using available cream to make print butter in advance of the spring 
holidays. Bulk butter pricing in the West this week is 2 cents below 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 January 6-12 found that the U.S. weighted average 
advertised price of 1 pound butter is $3.35, up $.66 from last week. The U.S. weighted 
average price was $3.39 one year ago. In the Southwest, the weighted average advertised 
price of 1 pound butter is $3.50 with a price range of $3.29-$3.99. In the Northwest, the 
weighted average advertised price of 1 pound butter is $2.99. According to the NASS Dairy 
Products report, U.S. butter production during November 2016, 143.7 million pounds, was 
5.7% lower than November 2015, but 1.5% higher than October 2016. U.S. cumulative 2016 
butter production through November is 1.725 billion pounds, 3.0% higher than the same 
period last year. In the West, total November butter production was 69.2 million pounds, 
9.8% lower than November 2015, and 0.8% lower than October 2016. California November 
production was 42.1 million pounds, 7.5% lower than last year, and 0.4% lower than last 
month. The Grade AA butter price at the CME Group on Wednesday closed at $1.2775, up 
$.0175 from a week ago.


2016 U.S. Butter and Milkfat Exports (USDA-FAS)

                 2016 Exports      % Change From 
                 (Million Lb.)       1 Year Ago

November Total        5.8             +107

TOTAL, JAN - NOV     50.0             +  7
 1 Mexico            20.1             +122
 2 Canada            15.9             +134
 3 Saudi Arabia       3.8             - 77
 4 South Korea        1.4             - 55
 5 Taiwan             0.9             + 11


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