CME: DEC Milk Futures Rally To New High

US - DEC Class III futures shot limit-up (+75¢) this morning on further seasonal gains in cheese prices, writes Alan Levitt.
calendar icon 4 November 2011
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Blocks traded 4.5¢ higher, and barrels were bid up 4¢ without attracting any loads for the second straight day.

DEC Class IIIs pulled back before the close, settling at $18.35, up 63¢ and a new high, while NOV gained 31¢ and JAN increased 33¢. Cheese futures for NOV-FEB were up 3.5¢.

Commercial stocks of NDM at the start of the fourth quarter were 150.9 million lbs., up eight per cent from a year ago, according to USDA (see chart).

Production of NDM and SMP has been heavy this year – combined output was up 4.3 per cent in the first half and up 12.1 per cent in the third quarter, putting 2011 production on track for a 46-year high. Commercial use has mostly kept pace, but appears to be lagging in recent months.

The NDM market remains soft and whey markets continue to strengthen, according to Dairy Market News’ weekly survey.

Western NDM is pegged at mostly $1.37-$1.49, unchanged from last week. Midwestern whey is mostly 59.5¢-63.0¢, up half a cent, DMN says.

“Manufacturers are not offering extensively into the spot market, therefore most sales activity in the edible market is between brokers/traders and end users,” the report says.

Further Reading

- You can view the full report by clicking here.

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