The following excerpt is from the USDA's Dairy Market News for the week of June 17 to 21. Download the complete report here.
BUTTER HIGHLIGHTS: Western butter prices are steady to weak as increased butter in cold storage weighs on the market. Buyers are looking for discounts as an incentive to purchase more than immediate needs. Domestic demand for print butter into Western retail and club stores continues to be strong.
Central bulk butter production is active, but churn operators report they are willing to forego some churning to sell into the Class II market at higher multiples. Cream multiples for the week range from 1.26 to 1.35 for all Classes. Northeast cream demand continued to improve this week, and as a result, butter production has seen further declines. Some Northeast butter makers have been able to curtail bulk butter production, due to the decrease in the cream supply.
Domestic demand for Northeast butter remains lackluster and below year ago levels and producers are building inventory.
Prices for bulk butter vary, ranging from 3 cents under to 5 cents under the market in the West, from 1 cent under to 1 cent over in the Central Region, and from 4-6 cents over the market in the Northeast. According to the FAS, quota imports of butter for January - May 2013 total 4.0 million pounds, 50.3% more than the same period in 2012. January - May imports for 2013 account for 26.2% of the yearly total quota. Imports of High-Tier butter (above quota and with a penalty) are 252,749 pounds, more than double last year’s high tier import of 110,137 pounds for January – May.