Thursday, November 15, 2018
 U.S. Cheese Supply Reaches 26-Year High  

The nation’s cheese supplies continued to pile up, reaching a 26-year high last month, according to U.S. Department of Agriculture data.

U.S. cheese inventories totaled 1.012 billion pounds at the end of April, up 7.8 percent from the same period in 2009, the USDA said in its monthly Cold Storage report May 21. That’s the highest for any month since supplies topped 1.044 billion in November 1984.

High cheese stocks stem in part from the recession, which hurt exports and restaurant business, two major demand sources. Additionally, U.S. milk production is increasing again following widespread herd cuts stemming from last year’s price crash.

The USDA also showed beef, chicken and pork supplies remain under last year’s levels – with frozen pork stocks down 21 percent - after losses the previous two years prompted producers to reduce herds.

While dairy prices have risen in recent months as the economy improved, the abundant supplies probably will limit further increases, analysts said.

“Large stocks keep a lid on prices,” said Alan Levitt, an industry analyst who writes CME Group’s Daily Dairy Report.

“As long as inventories are out there, buyers don’t have to panic,” Levitt said. “If buyers don’t have to worry about running short, they don’t have to bid the price up to unreasonable levels.”

Block cheese today was $1.50 a pound, up 12 percent from $1.34 March 1 and the highest in more than six weeks, based on CME prices.

Levitt expects block cheese to decline toward $1.40 in coming weeks before climbing back above $1.50 this summer.

Earlier this month, the USDA scaled back it’s projections for cheese and milk prices in 2010. Cheese prices will average $1.48 to $1.53 a pound, the USDA estimated, down from $1.49 to $1.54 previously. Prices averaged $1.30 last year.

Class III milk, used to make cheese and considered an industry benchmark, will average $13.95 to $14.45 per hundred pounds this year, down from $14.10 to $14.60 previously. Milk averaged $11.36 in 2009.

While cheese stocks are up, U.S. butter supplies at the end of April totaled 207.6 million pounds, down 14 percent from a year earlier, according to the Cold Storage report.

As of April 30, frozen beef supplies totaled 373.3 million pounds, down 9.1 percent from a year earlier, the USDA said.

Frozen pork supplies totaled 482.5 million pounds, down from 612.3 million a year earlier. Among individual cuts, loin supplies were down 16 percent and bellies, used to make bacon, were down 37 percent.

Pork supplies seasonally decline in the summer, “but end users are entering in the high demand summer months with much tighter inventories than usual,” livestock analysts Steve Meyer and Len Steiner said in a report today.

Chicken supplies totaled 623.9 million pounds, down 5.2 percent.

Source: Cattle Network

Posted on Wednesday, May 26, 2010 (Archive on Wednesday, June 02, 2010)
Posted by  Contributed by