CME barrels plunged even further off recent all-time highs, ending today at $2.4275 per pound, $0.1175 lower. Spot blocks also declined, but at a much slower pace, giving up 1.5 cents to settle at $2.1750 per pound. No volume traded for either commodity. Spot butter continued to lose steam, slipping to $2.8600 per pound, shedding four cents, with eight loads trading.
Despite the drop in spot butter, Class III futures climbed. Fourth quarter contracts advanced to $22.60 per hundredweight, gaining 15 cents. Fourth quarter Class IV futures moved in the opposite direction, dropping to $21.76 per hundredweight, down 24 cents. Butter futures followed spot prices lower, settling at $2.8920 per pound, losing $0.0392.
Europe’s cheese and butter remain far more expensive than global competitors New Zealand and the US. EU cheese settled at $2.61 per pound, compared to $2.37 in the US and $2.01 in New Zealand. European butter climbed even higher to $4.18 per pound. Butter is $2.90 per pound in both New Zealand and the US (all international prices adjusted to 80% butterfat). For milk powders, the US has the most expensive product at $1.38 per pound, compared to New Zealand’s $1.24 and the EU’s $1.32.
Ever.Ag – The risk of loss trading commodity futures and options can be substantial. Investors should carefully consider the inherent risks in light of their financial condition. The information contained herein has been obtained from sources to be reliable, however, no independent verification has been made. The information contained herein is strictly the opinion of its author and not necessarily of Ever.Ag and is intended to be a solicitation. Past performance is not indicative of future results.
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