Butter prices are retracting from previous weeks’ historic highs. USDA’s Dairy Market News reports that many butter manufacturers are faced with the decision of selling cream at a discount or producing butter at potentially falling prices. Some butter churn operators with orders yet to fill, took advantage of plentiful, discounted cream supplies available. The additional cream purchased allowed a few butter makers to back off microfixing as much bulk supplies, while increasing churn rates. Overall butter production levels are steady to higher with a few plants nearing capacity limitations.
Some sellers are experiencing increased competition in the retail segment as buyers become increasingly price sensitive. Interest for bulk butter is trending lower as less expensive international butter is psychologically putting buyers into a “wait and see” approach on purchases. Butter imports are making their way into the U.S. Manufacturer inventories in the Central region are light to marginally growing. Spot load availability of bulk butter is snug, however some additional supplies became available as prices reported ranged from 2 cents under the market to 6 cents over the market, with various time frames and averages used.
Western butter manufacturers continue to run busy schedules for print butter
production. Retail demand is good as holiday orders are not completed. Recent price reductions are increasing interest from bulk butter customers, but bulk supplies remain tight. Export sales are very slow with international prices lower than our domestic market. U.S. advertised butter prices are higher.
Source: DairyBusiness Update Daily