MD_DA440 DA MD DA440 BUTTER - WEST MADISON, WI. February 8, 2017 (REPORT 6) WEST BUTTER Western butter demand has waned slightly, but contacts still describe it as good for this time of year. High volumes of cream are forcing Western butter makers to try to find a home for available loads of cream. Butter inventories are building. Manufacturers would like to slow their churns and control the growth of butter stocks more closely. However, summer cream specialty manufacturers have yet to ramp up production. As a result, much of the cream is finding its way into butter churns. Butter production is active and primarily focused on making bulk butter. Some print butter manufacturing is occurring in advance of the spring holidays. Bulk butter pricing in the West this week is 4 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 February 3-9 found that the U.S. weighted average advertised price of 1 pound butter is $3.64, up $.33 from last week. The U.S. weighted average price was $3.32 one year ago. In the Southwest, the weighted average advertised price of 1 pound butter is $3.99. In the Northwest, the weighted average advertised price of 1 pound butter is $3.93 with a price range of $3.50- $3.99. According to the NASS Dairy Products report, U.S. butter production during December 2016, 163.8 million pounds, was 6.7% lower than December 2015, but 13.3% higher than November 2016. U.S. cumulative 2016 butter production through December is 1.889 billion pounds, 2.2% higher than the same period last year. In the West, total December butter production was 79.1 million pounds, 8.4% lower than December 2015, but 13.8% higher than November 2016. California December production was 50.4 million pounds, 2.0% lower than last year, but 19.0% higher than last month. The CME Group January 2017 monthly average price for AA butter, $2.2393, is up from the December monthly average of $2.1763. One year ago the CME Group monthly average was $2.1214. The Grade AA butter price at the CME Group on Wednesday closed at $2.1775, down $.0625 from a week ago. 2016 U.S. Butter and Milkfat Exports (USDA-FAS) 2016 Exports % Change From (Million Lb.) 1 Year Ago December Total 5.2 + 24 TOTAL, JAN - DEC 55.2 + 8 1 Mexico 20.7 + 83 2 Canada 19.6 +143 3 Saudi Arabia 4.0 - 76 4 South Korea 1.6 - 51 5 Taiwan 1.1 + 15 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