MD_DA640

     Nonfat Dry Milk - Western U.S.

     Report 49 - Released on December 05, 2019

     In the West, f.o.b. prices for low/medium heat nonfat dry milk (NDM) have been on the rise
     for the past 7 weeks, and this week is no exception. Compared to last week, prices have
     increased on both ends of the range and on the top of the mostly series. According to some
     contacts, buyers are not excited about the current price levels and feel constrained to
     purchase at prices above their projected costs to guarantee coverages. Low/medium heat NDM
     supplies vary between balanced and short. This situation is due to increasing exports to
     Mexico and other parts of the world. Some reports suggest that lower skim milk powder stocks
     in the European Union are causing several of their customers to fall back on the U.S. to
     meet their needs. In the domestic market, while many buyers are finishing up Q1 2020
     contract negotiations, some are waiting and hoping that spot market prices will be more
     favorable in the coming months. Low/medium heat NDM production is ongoing. High heat NDM
     prices have also increased at the top of the range. Production and spot sales are limited,
     whereas contractual demands continue to be stable. Overall, the market tone is steady.

     The November 2019 Dairy Market News monthly average for the West low/medium heat nonfat dry
     milk mostly series is $1.2039 compared to $0.8995 a year ago. The average for Western high
     heat nonfat dry milk is $1.3018 compared to $1.0456 a year ago.
     Prices for: Western U.S., All First Sales, F.O.B., Extra Grade & Grade A, Conventional, and
     Edible Nonfat Dry Milk
     Price Range - Low & Medium Heat; $/LB:                 1.1725 - 1.2950
     Mostly Range - Low & Medium Heat; $/LB:                1.2200 - 1.2600


     Prices for: Western U.S., All First Sales, F.O.B., Extra Grade & Grade A, Conventional, and
     Edible Nonfat Dry Milk
     Price Range - High Heat; $/LB:                         1.2500 - 1.4100

     Information for the period December 2 - 6, 2019, issued weekly

     Secondary Sourced Information:

     Grade A nonfat dry milk price at the CME Group on Wednesday closed at $1.2475, up from last
     week's average price of $1.2292.

     The CME Group monthly average price for Grade A NDM during November was $1.2139, compared
     to $0.8856 a year ago.

     At the GDT Event 249 on December 3, 2019 skim milk powder (SMP) prices across all contract
     periods averaged $1.3916 per pound, up 1.9 percent from the last event.

     Dairy Products Report – Nonfat Dry Milk, Human Summary
     Released December 4, 2019, by the National Agricultural Statistics Service (NASS),
     Agricultural Statistics Board, United States Department of Agriculture (USDA).

     Nonfat Dry Milk, Human Production – States and United States: Oct 2018 and 2019
                           Monthly Production (1000 pound     Percent Change from
                                 Oct      Sept       Oct          Oct      Sept
     Region                     2018      2019      2019         2018      2019
     United States           121,595   120,297   135,123         11.1      12.3

     Atlantic                 22,590    26,296    28,919         28.0      10.0
        Pennsylvania          10,795    12,720    13,280         23.0       4.4

     Central                  19,458    22,799    22,878         17.6       0.3
     West                     79,547    71,202    83,326          4.8      17.0
        California            44,897    39,078    48,092          7.1      23.1

     Other States 1/          65,903    68,499    73,751         11.9       7.7
     1/ States not shown when fewer than 3 plants reported or individual plant operations could
     be disclosed.

     Nonfat Dry Milk, Human Production – Cumulative Production January - October
                         Cumulative Production  Percent Change
                              (1000 pounds)          from
     Report Month               2018      2019       2018
     Oct                   1,496,594 1,539,376        2.9

                                       Manufacturers' stocks end-of-month 3/
                           End of month stocks (1000 pounds)   Percent Change from
                                 Oct      Sept       Oct          Oct      Sept
     Product                    2018      2019      2019         2018      2019
     Nonfat Dry Milk, Human  252,648   250,907   219,821        -13.0     -12.4
     3/ Stocks held by manufacturers at all points and in transit.

                                         Manufacturers' shipments 4/
                           End of month stocks (1000 pounds)  Percent Change from
                                 Oct      Sept       Oct          Oct      Sept
     Product                    2018      2019      2019         2018      2019
     Nonfat dry milk, human  118,658   121,743   155,047         30.7      27.4
     4/ For dry products, shipments of bulk goods.
     Published by:
     Dairy Market News - Madison, WI
     FLORENCE KONE-GONZALEZ, (608)422-8594
     Email: florence.konegonzalez@usda.gov

     Additional Dairy Market News Information:
     Dairy Market News (DMN) by Phone: (608)422-8602
     DMN Website: https://www.ams.usda.gov/market-news/dairy
     DMN MARS (My Market News): https://mymarketnews.ams.usda.gov