Results of the Global Dairy Trade auction for September 1 show nice gains pretty much across the board since the last auction was held August 18. On a weighted basis, dairy prices are up 10.9%.
Butter jumped 8% to a weighted average across contracts of $1.25/lb. Cheddar cheese was up 4.7% to $1.32/lb. Skim milk powder jumped 11.7% to 77¢/lb and whole milk powder increased 12.1% to 94¢/lb.
The bad news for U.S. farmers and exporters is that these world prices are below, sometimes way below, Chicago Merc prices. For example, spot prices for butter are at $2.36/lb, cheese at $1.75/lb and skim milk powder at 82¢/lb.
The September 1 auction saw 35,865 metric tons of dairy commodities trade. This is down 1,039 tons from August 18 and 10,662 tons less than the auction held August 4. (Note: At 46,527 tons, the August 4 auction was the largest amount traded since last October.