MD_DA830                                                         
DA                                                               
MD DA830 Cheese - Midwest                                        

MADISON, WI.  February 3, 2010 (REPORT 5)                       

MIDWEST CHEESE:  The cheese market is under pressure.  The sharp decline in 
NDM prices and, to lesser degree, butter prices may cause extra milk volumes 
to shift to cheese production (assuming extra plant capacity).  While the 
NASS January 1 milk cow inventory number is lower than a year ago, 
replacement heifer numbers are higher, likely to increase milk cow numbers in 
the not too distant future.  Recent price increases have ended with orders 
lighter as prices started to decline this week.  New orders are generally 
lighter with overtime levels falling at more packaging operations.  More 
firms are seeking new business in order to use more of the available supplies 
and line time.  Current cheese offerings are generally at least adequate with 
the needed lead times to produce specialties normal.  Spot interest is 
generally light to fair.  Plant operators are trying to keep inventories from 
accumulating with some reducing spot milk use.  Current milk intakes are 
steady to generally higher seasonally.  According to NASS, Cumulative 
estimated 2009 cheddar production totals 3.171 billion pounds, up 21.5 
million pounds (0.7%) from 2008 (in 366 days).  Mozzarella output in 2009 
totaled 3.285 billion pounds, an increase of 45.9 million pounds (1.4%) from 
an unadjusted 2008.  In 2009, total cheese output was put at 10.105 billion 
pounds, up 170.3 million pounds (1.7%) from 2008.                                          
WISCONSIN WHOLESALE SELLING PRICES:  DELIVERED,                  
DOLLARS PER POUND (1000 - 5000 POUNDS MIXED LOTS)                
                                                                 
Process American 5# Loaf                   : 1.8675-2.0475       
Brick And/Or Muenster 5#                   : 2.0225-2.1500       
Cheddar 40# Block                          : 1.9800-2.5650       
Monterey Jack 10#                          : 1.9875-2.5650       
Blue 5#                                    : 2.3125-2.8700       
Mozzarella 5 - 6# (Low Moisture, Part Skim): 1.8575-2.6650       
Grade A Swiss Cuts 6 - 9#                  : 2.6400-3.3300       

1300c  George Koerner 608-250-3205