GRAIN, CATTLE, HOG,
& MILK BFP
FUTURES MARKETS
Markets Courtesy of Chicago Board and Mercantile Exchange
Closing Bids: Wednesday, April 17, 2002
Com
Soybeans
469 1/2
474
472
7 1/
Soybean Meal
152.8
151.8
152.5
m
152.0
Weekly Dairy Market Outlook
Ken Bailey
Penn State
April 12,2002
Butter Markets Hit
Spring Flush
• Grade AA butter falls to
$1.15/pound.
• Cheese prices holding steady
• Global price of butter de
pressed.
Butter markets are predictably
depressed this week. Butter
prices were holding in the SI.2S
per pound range just before and
after Easter/Passover because of
strong commercial demand.
However, prices are weaker this
week because of strong butterfat
production and limited demand
for the available cream. Grade
AA butter prices in Chicago fell
from $1.22 per pound last week
to $1.15 per pound by the end of
this wedfcL * .
159.3
158.2
156.0 [ 156.6
157.6
154.4 b
153.9
55.3
151.8[~152.0
153.0
151.4
151.0
152.5
151.2 b
151.1
152.5
150.3 b
150.5
152.5
The reason for the price drop
is because butterfat production is
very strong and demand for
cream from ice cream processors
is just beginning to pick up. The
market is dealing with excess
butterfat, which is being churned
into butter. The combination of
strong production and high car
ryover stocks is putting down
ward pressure on the butter mar
ket. USDA reported this week
that butter inventory figures this
time of year are twice the level of
last year.
Butter prices normally decline
in the spring months since cream
and butter supplies are normally
much higher than market needs.
In 2000, Grade AA butter prices
were $0.97-$l.lO per pound in
Chicago during March and April.
Last year, however, milk and but
.tetfat. production .was 'depressed "
476
159.3
159.2
156.e| -13
154.5
154.5 a
152.0
151.4
151.3
151.3 a
150.6 a
150.5
Lean Hogs
Date
04/16/02 *CASH* 0 421742174217 -510
04/17/02 May 02 4895 50354895 5035 +2OO
04/17/02 Jun 02 5570 561555005597 +135
04/17/02 Jul 02 5570 563555355595 +63
04/17/02 Aug 02 5425 549054005435 +2B
04/17/02 Oct 02 4700472046704690 -5
04/17/02 Dec 02 4595 461545354537 -35
04/17/02 Feb 03 4875 489048254865 -27
Composite Volume Openjnt
04/16/02 9225 34258
Live Cattle
Date
04/16/02 *CASH* 0 679867986798 unch
04/17/02 Apr 02 6575 664765606607 +6O
04/17/02 Jun 02 6265 633262656300 +43
04/17/02 Aug 02 6317 637563156347 +3O
04/17/02 Oct 02 6650 668566456662 +27
04/17/02 Dec 02 6840 687568406857 +l5
04/17/02 Feb 03 6950 697569406952 +2
04/17/02 Apr 03 7070 708070607077 +l2
Composite Volume Open_lnt
04/16/02 17638 96677
Pork Bellies
Date
04/16/02 *CASH*
04/17/02
04/17/02
04/17/02
04/17/02
04/17/02
-5
-9
-10
Composite Volume Open_lnt
04/16/02 445 3315
-10
-13
Oats
-20
-23
-19
-10
-15
-10
during the spring months. Grade
AA butter prices rose to
$1.50-$1.96 per pound during
March and April of 2001.
Cheese prices at the Chicago
Mercantile Exchange held steady
this week. Blocks rose from $1.24
per pound on Monday, April 8 to
$1.25 by Friday, April 12. Barrel
cheese prices rose half a penny
per pound from $1.21 on Monday
to $1.2150 by Friday. Cheese pro
duction levels are strong for this
time of year, but demand is suffi
cient enough to clear the markets
each week.
Global butter prices have been
depressed in recent months. But
ter prices (82 percent butterfat)
for New Zealand and Australia
for the first half of April ranged
from $950-$1,050 per ton. That is
an average of $0.45 per pound,
well below the U.S. wholesale
butter price of $1.15 per pound.
The milk production season in
hotter. That will likely create an
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May 02 6690 687066806800 +lOB
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Aug 02 6700 6890670b6772 +B2
Feb 03 6670667066706670 +l5
Mar 03 6627 662766276627 unch
New Zealand and Australia is
winding down. USDA reports
that they are +5 percent ahead of
the prior season.
So what does it cost to export
butter from New Zealand to the
U.S.? If it is for butter outside
our TRQ quota, the applicable
tariff is 30.9 cents per kilogram,
or $0.68 per pound. The trans
portation cost of butter from that
part of the world to the U.S. is
$2OO per ton, or 9 cents per
pound. With a global price of
$0.45 per pound, you can price
New Zealand butter right now
into the U.S. market for just
$1.22 per pound, which at this
moment is above the U.S. price.
The relative difference between
the U.S. and import price will
change quickly in the next few
months as demand for ice cream
heats up. Ice cream is a big user
of cream, which will be in short
supply when the weather gets
Average Farm Feed
Costs for Handy
Reference
To help farmers across the state to have
handy reference of commodity input costs
in their feeding operations for DHIA re
cord sheets or to develop livestock feed
cost data, here’s last week’s average costs
of various ingredients as compiled from
regional reports across the state of Penn
sylvania.
Remember, these are averages, so you
will need to adjust your figures up or
down according to your location and the
quality of your crop.
Com, No.2y 2.30 bu., 4.11 cwt.
Wheat, N 0.2 2.61 bu., 4.36 cwt.
Barley, N 0.3 —1.85 bu., 3.96 cwt.
Oats, N 0.2 —l.BB bu., 5.85 cwt.
Soybeans, No.l 4.28 bu., 7.14 cwt.
Ear Com 65.66 ton, 3.28 cwt
Alfalfa Hay 150.50 ton, 7.53 cwt
Mixed Hay —148.75 ton, 7.44 cwt.
Timothy Hay 125.00 ton, 6.25 cwt