MD_DA440 DA MD DA440 BUTTER - WEST MADISON, WI. June 7, 2017 (REPORT 23) WEST BUTTER Western butter production is following typical seasonal patterns. A few manufacturers are trying to slow the churns and find other markets for their cream. Other processors are using available cream to build inventories for the end of the year. Bulk butter production is becoming more prevalent to print butter production. Retail butter demand is strong. Industry contacts are watching extended weather forecasts closely. A few contacts suggest that if the region gets a lot of hot weather, ice cream manufacturers may increase cream demand quickly, resulting in less cream to move into the churns and higher butter prices. End users, in particular, are uneasy about this scenario and want to make sure they have coverage for late year butter needs. Bulk butter pricing in the West this week is 4 cents below to 2 cents above, based on the CME Group with various time frames and averages used. The DMN National Retail Report-Dairy for the week of June 2-8 found that the U.S. weighted average advertised price of 1 pound butter is $3.31, down $.26 from last week. The U.S. weighted average price was $3.28 one year ago. In the Southwest, the weighted average advertised price of 1 pound butter is $3.65 with a price range of $2.49-$4.49. In the Northwest, the weighted average advertised price of 1 pound butter is $3.60, with a price range of $1.99-$3.99. According to the NASS Dairy Products report, U.S. butter production during April 2017, 164.1 million pounds, was 4.1 percent lower than April 2016, and 6.8 percent lower than March 2017. U.S. cumulative 2017 butter production through April is 679.0 million pounds, 0.9 percent lower than the same period last year. In the West, total April butter production was 75.7 million pounds, 6.2 percent lower than April 2016 and 2.1 percent lower than March 2017. California April production was 48.0 million pounds, 6.9 percent lower than last year and 5.2 percent lower than last month. The CME Group May 2017 monthly average price for AA butter, $2.2684, is up from the April monthly average of $2.0992. One year ago the CME Group monthly average was $2.0554. The Grade AA butter price at the CME Group on Wednesday closed at $2.4625, up $.0525 from a week ago. 2017 U.S. Butter and Milkfat Exports (USDA-FAS) 2017 Exports % Change From (Million Lb.) 1 Year Ago April 4.2 + 36 TOTAL, JAN - APR 15.7 - 37 1 Canada 7.0 +139 2 Mexico 2.4 - 86 3 South Korea 1.3 +151 4 Saudi Arabia 1.2 - 45 5 Peru 0.8 +845 2017 U.S. Butter and Milkfat Imports (USDA-FAS) (Imports for Consumption) 2017 Imports % Change From (Million Lb.) Last Month April Imports Total Butter, Fats, Milk (H.S. Code 0405) 6.9 + 24 Butter Quota (H.S. Code 405101000) 0.6 ... Over Quota (H.S. Code 405102000) 4.4 + 50 AMF Quota (H.S. Code 405901020) 0.4 - 67 Over Quota (H.S. Code 405902020) 1.4 + 85 Other Milk Fat 0.1 + 63 2017 Imports % Change From (Million Lb.) 1 Year Ago TOTAL, JAN - APR 24.7 - 41 1 Ireland 11.9 + 29 2 Mexico 3.9 - 61 3 New Zealand 3.8 - 69 4 Chile 1.7 + 24 5 France 1.1 - 24 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