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Specialty cheesemakers in Midwest react to lower milk volume by canceling or delaying orders

Just as football training camps begin seasonal activity, there are increasing reports from cheese manufacturers about buyers beginning to more actively consider inventory needs for the last quarter of 2013 and the first of 2014.

August 5, 2013

The following excerpt is from the UDSA's Dairy Market News for the week of July 29 to Aug. 2. Download or read the complete report here.

In the Midwest a number of larger cheesemakers with contracted milk supplies report that milk supplies are up from a week ago. With cheese prices also up last week, some plants which previously shifted production emphasis from cheese to nonfat dry milk, have now reversed and are re-directing more milk into cheese.

These plants report that Process cheese sales are “strong” while Natural cheese sales are “off a little”. Overall, most manufacturers are “comfortable” with the current cheesemaking situation.

A different situation is reported by some smaller and more specialty cheese plants. In various locations, there are reports of canceling or delaying delivery of a portion of existing cheese orders, due to lower milk volume and components in the milk available to smaller specialty cheese plants. Spot milk is available to these plants to maintain production to fill orders, but it was a business decision not to pay $2.00 or $3.00 over Class to obtain spot milk to fill all of the orders.

Just as football training camps begin seasonal activity, there are increasing reports from cheese manufacturers about buyers beginning to more actively consider inventory needs for the last quarter of 2013 and the first of 2014. Many are finding plenty of cheese in inventory overall but for now, “a shortage of discounted product.” As more focus turns to stocking for the last quarter, the tension between inventory and pricing bears watching.
 

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