MD_DA440  
DA 
MD DA440 BUTTER - WEST 

MADISON, WI.  June 28, 2017 (REPORT 26)

WEST BUTTER

Western butter makers report cream is available for butter production, but seasonal 
demand is making cream supplies tighter. Some butter processors are choosing to slow 
their butter churns and sell off their cream to ice cream and other Class II 
manufacturers because of the strong milkfat prices. Butter inventories are seasonally 
high and manufacturers are managing stocks closely to assure they have the butter needed 
to meet the expected high Q3/Q4 demand. End users also are very much aware of year-end 
butter needs. Buyers are eager to secure butter for current and future requirements. Some 
industry contacts suggest a few end users are seeking quotes for available butter into 
2018. 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. However, some contacts 
report overages as high as 10 cents above for limited quantities. The DMN National Retail 
Report-Dairy for the week of June 23-29 found that the U.S. weighted average advertised 
price of 1 pound butter is $3.16, down $.23 from last week. The U.S. weighted average 
price was $3.02 one year ago. In the Southwest, the weighted average advertised price of 
1 pound butter is $4.15 with a price range of $1.99-$4.99. In the Northwest, the weighted 
average advertised price of 1 pound butter is $2.25, with a price range of $1.99-$3.50. 
The NASS Cold Storage report noted U.S. butter stocks as of May 31, 2017, were 313.6 
million pounds, up 7 percent from last month, but down 3 percent from last year. Butter 
stocks in all warehouses were 324.9 million pounds last year at this time. According to 
the California Department of Food and Agriculture, May 2017 butter production was 45.8 
million pounds, down 7.5 percent from a year ago. California year-to-date butter 
production through May is 244.7 million pounds, down 6.0 percent from 2016 butter 
production through May. The Grade AA butter price at the CME Group on Wednesday closed at 
$2.6400, up $.0550 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