Dairy product prices are getting back to levels dairy producers like to see, according to Robert Cropp, professor emeritus at the University of Wisconsin. Cropp said that butter stocks are tight and the market is strong for this time of year. June 30 stocks were down 25 percent, he said, due to the fact that cream supplies are tight, milk fat tests are down, CWT has bonuses in exports of butter and milk production is declining.
"Butter sales have been pretty good, but there is some concern with these kinds of prices," Cropp said. "We'll start getting resistance at the retail level, but that hasn't happened yet." The futures market had butter declining to $1.66 by December, according to Cropp.
"We'll see whether that will occur or not, but it probably will decline towards the end of the year," he said.
Cheese is a little more uncertain in that June stocks were still relatively high, at about 4 percent higher than a year ago. Cheese production was also pretty strong in June, he said, as total cheese production was up 5.2 percent.
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