MD_DA440  
DA 
MD DA440 BUTTER - WEST 

MADISON, WI.  June 14, 2017 (REPORT 24)

WEST BUTTER

Western butter demand is strong. End users, uneasy about possible higher future 
prices, seem willing to pay more in the short term to assure coverage of butter 
needs for the second half of the year. Milk fat supplies are getting tighter. Ice 
cream and other Class II manufacturers are pulling large volumes of cream away 
from the butter churns. In addition, a lot of milk fat is getting tied up in 
cheese production. However, butter manufacturers report cream is still available 
for most processing needs. Butter makers are using different strategies for 
butter production, guided by their end of year butter commitments. Some 
manufacturers say they are trying to make more butter and build inventories ahead 
of Q3 and Q4 butter needs, while other processors are working to sell cream and 
slow their churns as a measure to control butter stock levels. Bulk butter 
pricing in the West this week is 3 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 June 9-15 found that the U.S. weighted average advertised 
price of 1 pound butter is $3.46, up $.15 from last week. The U.S. weighted 
average price was $3.33 one year ago. In the Southwest, the weighted average 
advertised price of 1 pound butter is $2.98 with a price range of $2.49-$3.50. In 
the Northwest, the weighted average advertised price of 1 pound butter is $3.76, 
with a price range of $2.50-$4.29. The Grade AA butter price at the CME Group on 
Wednesday closed at $2.7000, up $.2375 from a week ago.

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