The KDM Dairy Report 6/17/2022

Cheese: Cheesemakers across the country say that milk supplies are available for production facilities to run active schedules. Some Midwest contacts relay that production schedules are limited by labor shortages. These shortages as well as delayed deliveries of production supplies are causing some cheesemakers in the West to run below capacity. Meanwhile, a few barrel cheese plant operators in the Midwest are reporting some maintenance related downtime this week. Domestic demand for cheese has, reportedly, begun to soften across both food service and retail markets in the West, though sales are fairly stable with some hints of softening in the Northeast. Midwest cheese orders are stable and/or meeting seasonal expectations. Contacts in the Northeast and West say that strong interest is present from purchasers in international markets and that spot inventories are available in both regions.  (USDA Cheese Highlights)

Butter: Across all regions, cream inventories are tightening. Despite this, some contacts in the Northeast report that cream is more available than is typical at this time of year. In the West, some stakeholders say that they are receiving inquiries from cream purchasers in other regions. Slower butter sales and higher cream multiples, in the Northeast, are contributing to some reduced butter production schedules and increased cream sales. In the Central region, some butter makers indicate that they are increasing their micro-fixing. Plant managers in the region have been reporting staffing shortages for months, and some are concerned with the additional employees needed for micro-fixing. Butter makers in the West say that labor shortages and delayed deliveries of production supplies have caused output to fall below expectations for the last few months. In the Northeast and West, consumer demand for butter at both retail and food service markets has softened. Some purchasers in these regions are, reportedly, selecting lower-priced private label brands of butter due to higher retail prices. Loads of butter are available in the Central and West regions, though availability has tightened in the Northeast. Across all regions, bulk butter overages range from 5 to 15 cents above market.  (USDA Butter Highlights)

Dry whey: The dry whey price range contracted, while at the bottom it shifted lower. Generally, contacts say current prices are in an good trading window. Recently produced loads are moving into the high $.50s/low $.60s, while in-spec production from earlier in the spring is pricing toward the lower $.50s. Demand notes are mixed. Some traders say there are plenty of takers. However, some producers say they may move prices lower to move loads at larger volumes before buildups begin. Production has been somewhat steady, despite worker and supply chain issues being regularly reported in recent months. Animal feed whey prices are unchanged on quiet trading. Dry whey market tones are uncertain. (USDA Dry Whey updates)