DAIRY prices have held fairly firm in recent weeks, and the opportunity for dairy producers to bank some profits will likely lead to an expansion of the supply over the next year.
U.S. Department of Agriculture data released last week indicated that August cheese production grew 3.9% compared with last year, with butter production up 4.7%. The August data were originally scheduled to be released Oct. 3 but was delayed until Oct. 21 due to the federal government shutdown.
Total cheese output in August was 926 million lb., up 1.9% from July's total, with butter production of 136 million lb., up 1.5% from July.
Dry whey production during August fell 6.3% year over year, with lactose up 3.3% and whey protein concentrate up 8.5%.
Frozen product volumes fell sharply compared with last year as regular ice cream dipped 4.8% lower, low-fat ice cream fell 12.9%, sherbet fell 2.9% and frozen yogurt production slipped 16.4%.
Skim milk powder production jumped 36.5% compared with August 2012; the industry remains optimistic about opportunities in the overseas infant formula market.
Class III milk futures last week hovered near $18.25/cwt., with cash-settled butter futures near $1.544/lb. and block cheese futures near $1.86/lb.