DAIRY MARKET NEWS WEEK OF FEBRUARY 28 - MARCH 4, …

1 DAIRY MARKET news WEEK OF JULY 11 - 15, 2022 VOLUME 89, REPORT 28 DAIRY MARKET news AT A GLANCE TABLE OF CONTENTS Product Highlights/CME/DMN at a Glance 1 Weekly CME Cash Trading/Butter Markets 2 Cheese Markets 3 Fluid Milk and Cream 4 Nonfat Dry Milk/Dry Buttermilk/Dry Whole Milk 5 Dry Whey/WPC 34%/Lactose/Casein 6 DAIRY Cow Slaughter/Class Milk Prices/NDPSR/Futures 7 Organic DAIRY MARKET news 8 Supply & Demand Estimates 9 Consumer Price Index 11 Producer Price Index 12 Estimated Fluid Product Sales 13 DAIRY Graphs G1 National Retail Report - DAIRY DAIRY MARKET news Contacts CME

2 GROUP CASH MARKETS (7/15) BUTTER: Grade AA closed at $ The weekly average for Grade AA is $ ( ). CHEESE: Barrels closed at $ and 40# blocks at $ The weekly average for barrels is $ ( ) and blocks, $ ( ). NONFAT DRY MILK: Grade A closed at $ The weekly average for Grade A is $ ( ). DRY WHEY: Extra grade dry whey closed at $ The weekly average for dry whey is $ ( ). CHEESE HIGHLIGHTS: Milk is available for cheesemaking throughout the country. Contacts in the Midwest report spot trades of milk have slowed this week as high temperatures in the region are impacting milk output. Production is steady in the Midwest and West, while Northeast cheese makers are running active production schedules.

3 Cheese inventories are available in the West and are reportedly growing in the Northeast. In the Midwest, cheese inventories are somewhat balanced with current demand. International demand for cheese is strong in the Northeast and West and contacts report steady domestic demand. Domestic sales of cheese are below the expectations of some contacts in the West. BUTTER HIGHLIGHTS: Cream availability is tightening in the Northeast and West. Demand for cream is strong in the West. In the Central region, spot cream loads remain available, despite higher temperatures impacting cow comfort and farm level milk production. Butter production is steady to lower in the Northeast.

4 In the Central and West regions, contacts say staffing shortages are preventing them from running at capacity. Throughout the country, domestic demand is softening. Lower butter prices for butter at the July 5th GDT event have, reportedly, contributed to lighter export demand of butter from the West. Bulk butter overages range from 2 to 15 cents above MARKET , across all regions. FLUID MILK: Milk production is steady to lower through much of the nation as summer heat takes hold. The exception is the Pacific Northwest, where favorable weather has improved cow comfort and temporarily increased milk output. Spot milk loads are available in the Upper Midwest, but purchases and offers are lower than previous weeks.

5 Reported spot milk prices are $3 to $1 under Class III in the Midwest and $6 under Class IV in the mountain states. In the West, some milk is moving from California and the mountain states into neighboring states. Cream availability is steady to tighter and multiples have moved slightly higher. cream multiples for all classes are in the East; in the Midwest; in the West. Condensed skim demand is strong in the West but varies in the East. DRY PRODUCTS: Low/medium heat nonfat dry milk (NDM) prices slipped during the trading week. Domestic and export demands have been quiet. High heat NDM prices shifted lower, also. Buttermilk powder prices held steady in all regions, based on limited supplies and slow trading activity, in general.

6 Dry whole milk prices held, based on scant production/availability. Central dry whey prices were steady on slow trading. The Western dry whey price contracted, while prices slid lower in the East. Whey customer interests are limited amid potentially bearish upcoming MARKET tones. The bottom of the lactose price range increased, while all other prices were unmoved. Whey protein concentrate 34% prices were static on slower trading, particularly for loads not meeting certain specifications. Rennet casein prices were steady after last week s movement up, while acid casein prices moved significantly higher based on continued demand during a very firm MARKET . ORGANIC DAIRY MARKET news : The May 2022 estimated sales of total organic milk products was 244 million pounds, up fluid product percent from May 2021, but down percent year-to-date.

7 Organic whole milk sales, 114 million pounds, were up percent compared to a year earlier and up percent year-to-date. Reduced fat milk (2%) sales were 80 million pounds, up percent from the previous year, but down percent year-to-date. Organic flavored whole milk sales, 2 million pounds, increased percent from the previous year and increased percent year-to-date. Total organic DAIRY retail advertisements increased 110 percent. Store ads are 34 percent higher than last year for this period. Organic yogurt promotions soared, posting 13 times more ads compared to last week. Meanwhile, organic milk ads, as a whole, increased 89 percent across the country. The biggest change to ads amongst surveyed DAIRY commodities, by package size, occurred with organic Greek yogurt, 32-ounce packaging, which saw a 323 percent jump in ads.

8 The national weighted average advertised price rose to $ , up 31 percent from last week. NATIONAL RETAIL REPORT: Total organic DAIRY retail advertisement totals more than doubled this week, while conventional DAIRY ad numbers slid by four percent from week 27. Conventional ice cream, in 48-to-64-ounce containers, continues to take the top spot of most advertised DAIRY item despite a 15 percent drop week over week. Clearly, cultures have changed from one week to the next, as total yogurt ad numbers moved higher week to week. Retailers increased organic yogurt ad totals by 12 times compared to last week. CONTINUED ON PAGE 1A Co mmo dityCo mmo dityCo mmo dityNDMBUTTERMILKLACTOSE Central Low/Med.

9 Central High 3 4 % West Low/Med. West High WHOLE FEED WHEY MARKET news PRICE SUMMARY FOR JULY 11 - 15, 2022PR ICES ($/LB) & CHAN GES FR OM PR EVIOUS PUBLISHED PR ICES Range Mostly Range Mostly Range MostlyCONTINUED FROM PAGE 1 Conventional Greek yogurt in four-to-six-ounce containers was the most advertised yogurt item of the week, as the weighted average advertised price slid by four cents to $.99. JULY SUPPLY AND DEMAND ESTIMATES (WASDE): Milk production forecasts for 2022 and 2023 are lowered from last month due to slower expected growth in milk per cow. Imports on a fat basis are raised for 2022 on stronger expected imports of butterfat containing products and several other DAIRY products, but imports on a skim solids-basis are unchanged.

10 Exports on both a skim-solids and a fat basis are also raised for 2022, reflecting stronger expected exports of butter, cheese, whey, skim milk powder, and lactose. With a lower cheese price, the Class III price is lowered while the Class IV price is raised due to higher butter prices. The all milk price for 2022 is lowered to $ per cwt. JUNE CONSUMER PRICE INDEX (BLS): The June CPI for all food is , up percent from 2021. The DAIRY products index is , up percent from a year ago. The following are the June, year to year percentage changes for selected products: fresh whole milk is + ; cheese, + ; and butter, + JUNE PRODUCER PRICE INDEX (BLS): The June PPI for all food is , up percent from 2021.