CME: Cheese Offered Lower, Butter Bid Higher

US - Sellers had the upper hand in the cheese pits this morning, offering blocks and barrels lower, writes Alan Levitt.

10 January 2012

1 minute read

North America

After last week’s increases, yesterdays decline sent milk futures into the red, with FEB (-35¢) and MAR (-23¢) falling the hardest.

Spot butter, on the other hand, was bid 3.5¢ higher to $1.64. Last year the butter price gained 43¢ in the first week of the year, then stayed above $1.90 until September (see chart).

Nearby butter futures were higher yesterday while back months were lower.

CWT accepted bids to provide export assistance on sales of 6.4 million lbs. of cheese for delivery through June. Last year CWT assisted on 91.5 million lbs. of cheese exports.

Nearly three quarters of a million dairy futures and options contracts were traded at CME Group in 2011 – an average of almost 3,000 trades per day.
Among dairy futures, 429,260 contracts were traded, up 39 per cent from 2010 activity. Dairy options volume increased 81 per cent to 316,093 trades, according to the latest CME Group volume report.

Holiday schedule: CME Group will be closed next Monday, 16 January, in observance of Martin Luther King Jr. Day. Regular trading will take place on Friday. Globex trading for dairy will resume at 5pmCT on Monday for Tuesday’s trade date.