meta Cheese Prices Surge Amid Declining Butter: CME Dairy Market Analysis for January 28th, 2025 | The Bullvine

Cheese Prices Surge Amid Declining Butter: CME Dairy Market Analysis for January 28th, 2025

Dairy markets show mixed signals as cheese prices climb while butter hits 2025 low. Farmers face a complex landscape with Class III futures rising and Class IV dipping. Dive into our latest market report to understand the trends shaping your bottom line and strategies for navigating these choppy waters.

Summary:

The dairy market on January 28, 2025, showed different trends. Cheese prices increased while butter prices dropped to their lowest this year at $2.5000 per pound. This suggests either too much butter or less demand. Cheddar Block prices increased by 2 cents to $1.8900 per pound, and Cheddar Barrel prices rose by 2.5 cents to $1.8650 per pound. Nonfat Dry Milk and Dry Whey stayed steady. The future looks brighter for cheese, with higher Class III milk futures, but butter has challenges. Dairy farmers must adapt to these changes.

Key Takeaways:

  • Butter prices have reached their lowest in 2025, posing potential challenges for producers.
  • Cheddar cheese prices are rising, indicating a positive outlook for cheese producers.
  • The futures market suggests more substantial pricing expectations for Class III milk, benefiting cheese-focused operations.
  • Dairy farmers are encouraged to adapt to market fluctuations for sustained success in 2025.
  • Diversification and strategic decision-making are crucial as market dynamics shift.
dairy market trends, cheese prices rise, butter prices decline, Class III futures, CME spot market

On January 28, 2025, the dairy market had mixed conditions: strong cheese prices and the lowest point for butter prices. The CME spot market saw Cheddar prices increase while butter declined, reflecting the complex dynamics in the dairy industry

Spot Market Analysis 

 FinalChange ¢/lb.TradesBidsOffers
Butter2.5000-3.00863
Cheddar Block1.8900+2.00010
Cheddar Barrel1.8650+2.50010
NDM Grade A1.3475NC001
Dry Whey0.6975NC001

The CME spot market on Tuesday revealed divergent trends across dairy commodities. Butter prices declined, reaching $2.5000 per pound, 3 cents lower than the previous price, marking the lowest price in 2025. This decline occurred despite active trading, with eight loads changing hands, indicating a possible oversupply or weakened demand in the butter market. 

In contrast, the cheese market showed signs of resilience. Cheddar Block prices rose by 2 cents to close at $1.8900 per pound, while Cheddar Barrel prices increased by 2.5 cents to settle at $1.8650 per pound. Despite no trades being recorded for cheese, the price increases suggest a positive sentiment in the market. 

Butter weekly average: $2.5150, down from $2.5250 last week 

Other dairy commodities remained stable, with Nonfat Dry Milk (NDM) Grade A holding steady at $1.3475 per pound and Dry Whey maintaining its price at $0.6975 per pound. Both products showed negative weekly trends: NDM’s average decreased to $1.3500, and Dry Whey’s average dropped to $0.7088. 

 MonTueWedThurFriCurrent Avg.Prior Week Avg.Weekly Volume
Butter2.53002.50002.51502.525013
Cheddar Block1.87001.89001.88001.80199
Cheddar Barrel1.84001.86501.85251.82504
NDM Grade A1.34751.34751.34751.35000
Dry Whey0.69750.69750.69750.70880

Futures Market Insights 

 MonTueWedThurFri   
Class III (FEB) $/CWT19.9020.360.000.000.00   
Class IV (FEB) $/CWT.20.6020.300.000.000.00   
Cheese (FEB) $/LB.1.8671.90100.000.000.00   
Blocks (FEB) $/LB.1.7921.84900.000.000.00   
Dry Whey (FEB) $/LB.0.68950.70280.000.000.00   
NDM (FEB) $/LB.1.361.35750.000.000.00   
Butter (FEB) $/LB.2.592.57000.000.000.00   
Corn (MAR) $/BU.4.82254.85250.000.000.00   
Corn (DEC) $/BU.4.57254.61250.000.000.00   
Soybeans (MAR) $/BU.10.45510.45750.000.000.00   
Soybeans (NOV) $/BU.10.437510.48250.000.000.00   
Soybean Meal (MAR) $/TON323.50302.100.000.000.00   
Soybean Meal (DEC) $/TON322.60323.700.000.000.00   
Live Cattle (APR) $/CWT.204.175207.450.000.000.00   

The futures market provided a brighter outlook for dairy farmers, especially in the cheese sector. Class III milk futures for February saw a significant boost, rising by 46 cents to $20.36 per hundredweight. This increase indicates higher price expectations for milk utilized in cheese production. 

February Class III milk futures: Up 46 cents to $20.36 per cwt 

Cheese futures mirrored the positive trend in the spot market, with blocks increasing to $1.8490 and barrels to $1.9010. This upward movement indicates growing optimism among market participants regarding cheese production and consumption. 

Nevertheless, some sectors did not share a positive outlook. Class IV milk futures, closely tied to butter and powder markets, experienced a slight decline, settling at $20.30 per hundredweight. This decline corresponds to the decreasing butter prices seen in the spot market. 

Market Implications for Dairy Farmers 

For dairy farmers, the current market conditions offer both challenges and opportunities: 

  • Butter producers may experience margin pressure from decreasing prices, especially those heavily dependent on butterfat sales.
  • Cheese producers and farmers focused on fluid milk sales can find encouragement in the positive trends in Cheddar prices, which rose by 2 cents, and Class III milk futures, which saw a significant boost of 46 cents.
  • The stagnant NDM and Dry Whey markets suggest that farmers closely monitor demand conditions for these products.

“The divergence between butter and cheese markets highlights the importance of diversification for dairy operations. Farmers who strategically adjust their production focus by shifting towards cheese production can benefit more from the current market strengths in the dairy industry.”

The Bottom Line

Farmers must remain adaptable and vigilant as the dairy market continues to evolve. While the butter market faces headwinds, the positive momentum in cheese and Class III futures offers a silver lining for the industry. Remaining informed about market trends and proactively adjusting strategies will be crucial for successfully navigating the evolving dairy landscape in the upcoming months.

Review Bullvine’s dairy market updates regularly to stay ahead of market fluctuations and adjust your production strategies as needed. 

Learn more:

Join the Revolution!

Bullvine Daily is your essential e-zine for staying ahead in the dairy industry. With over 30,000 subscribers, we bring you the week’s top news, helping you manage tasks efficiently. Stay informed about milk production, tech adoption, and more, so you can concentrate on your dairy operations. 

NewsSubscribe
First
Last
Consent
(T44, D4)
Send this to a friend