Dairy Profit Friday, March 12
An (almost) daily recap of dairy information:
March 12, 2010
Dairy trade
The new year started out on a brighter note regarding dairy trade, with January 2010 exports surpassing imports by $30 million. January 2010 U.S. dairy exports was estimated at $225 million, virtually unchanged from December 2009, but $49 million more than January 2008. The value of U.S. dairy imports declined in January, to $195 million, down 22% from December 2009 and $36 million less than January 2009.
Y-T-D fiscal year 2010 (October 2009-January 2010) exports total $909 million, up 3% from the same period in FY ’09. Y-T-D FY ’10 imports total $882 million, down 22% from the same period last year. The FY ’10 trade surplus is estimated at $27 million.
January 2010 cheese imports were valued at $67 million, down 37% from December 2009. Y-T-D FY ’10 cheese imports were valued at $376 million, down 9% from a year ago.
The U.S. dollar and corn prices: What’s the connection?
It has not been uncommon for daily fluctuations in corn prices to be attributed to fluctuations in the value of the U.S. dollar relative to other currencies. So, what is the connection? University of Illinois economist Darrel Good said tt appears that the impact of the value of the U.S. dollar on the value of corn may be less than implied by daily market commentary. However, it is unlikely that the corn market will completely ignore currency values in the price discovery process.
The week: Cheese prices continued to bleed the second week of March, but may have hit bottom, according to DairyLine Radio’s Lee Mielke. Chicago Mercantile Exchange cash blocks closed at $1.2675/lb. on March 12, down 3¢ on the week, and just 1.75¢/lb. more than the corresponding week a year earlier. Barrels closed at $1.2625/lb., up 1.25¢ on the week, but 5.5¢ less than a year ago. The block price lost 23.75¢/lb. in the last four weeks, with comparable losses on barrels.
The CME’s Daily Dairy Report points out fourth-quarter 2009 commercial American cheese use was down 2.5% from a year ago, ending five straight quarters of growth. However those declines were partially offset by stronger use of other cheeses, with total cheese use for the quarter up 1.5%.
Butter is, or was, the bright spot. However, after eight consecutive sessions of gain, CME cash butter prices fell 3¢ from the high of the week on Tuesday, and closed Friday at $1.4550/lb., up just 0.5¢ from the previous week and 27¢ more than a year ago.
Closing on Friday, March 12:
Cheddar blocks – unchanged at $1.2675/lb.
Cheddar barrels – up 0.25¢, to $1.26250/lb.
Butter – down 1¢, to $1.4550/lb.
Extra Grade nonfat dry milk – unchanged, at $1.12/lb.
Grade A nonfat dry milk – unchanged at $1.11/lb.
Class III milk futures prices were steady to mixed in a narrow range through 2011.
DAIRYLINE RADIO: Monday
California dairy producer and Dairy Management Inc. board member Brad Scott “told his story” to DairyLine’s Bill Baker at last month’s World Ag Expo, and DairyLine listeners get to hear it in Monday’s “DMI Update.” There’s been enough negative press about dairy farms in the past but the dairy checkoff’s “Telling Your Story” program helps farmers defend themselves and their industry, he said. Scott said he takes every opportunity he can to tell his story, and recommends his fellow producers do so as well, whether it be to a neighbor who stops by, someone at school or church, someone you see at the supermarket, or the media.
Tell them what you do on your dairy, Scott said, what you do for the environment, how your farming practices are sustainable, how you care for the land and your animals, and how dairy farmers provide good, healthy products for the public. Listen to the conversation ont DairyLine.
For a sample copy of Dairy Profit Weekly, or subscription information, visit www.dairyprofit.com or phone: 800-334-1904, ext. 244.
Dave Natzke, Editor