Dairy Skim – May 2024 US Cold Storage Report

Dairy Skim is a bite-size episode series where HighGround’s top analysts break down the latest dairy data release. Today, Cara Murphy discusses the May 2024 US Cold Storage Report. Customers can view the snapshot report here. Subscribe so that you never miss an episode!

Transcript:

(0:14) Cara Murphy:
Hello everyone and welcome back to the Dairy Skim, HighGround Dairy’s bite-sized podcast intended to give the dairy industry some flavor into the recent reports or events that can impact global commodity pricing. This is Cara Murphy, HighGround’s Senior Market Intelligence Manager here to give you the scoop on the latest USDA May 2024 Cold Storage Report, which provides the industry with ending stock data for both butter and cheese. For the sake of time, let’s get into it.

(0:41)
Even as butter prices remain above the $3 per pound mark, the 380.2 million pounds of butter in cold storage this month was bullish to our expectations. 18.1 million pounds was put away from April to May, smaller than the 27.5 million pound five-year average, excluding the 2020 COVID year outlier. Without that year, this month-to-month build was the smallest since 2013. While stocks are up 3.4% year-on-year, they are by no means at record highs, which is why we believe this data is bullish to the current butter market value.

(1:15)
On the cheese board, bullish expectations all around. Total cheese stocks fell by 700,000 pounds from April to May, a counter-seasonal move we have not seen since 2020 or 2019 if we exclude the COVID year. Most notably, there was a significant 16 million pound lower revision to the April data, which accounted for a decrease of 1.1%. This revision was primarily due to a 13.6 million pound lower revision to natural cheese, accounting for a 1.6% loss.

(1:48)
In May, natural American cheese stocks came in at 821 million pounds, the smallest May ending volume since 2021. This also marked the fourth consecutive month that stocks declined on a monthly basis, with only one other time, 2020, in the past 10 years that stocks moved lower between April and May. The 12 million pound decrease was smaller than the five-year average, which adds to the bullish market sentiment. Other than American cheese marked the lowest May stock since 2019 at 622 million pounds. While this is lower than in 2023, stocks moved in tandem with the seasonal April to May build up 3.6 million pounds, greater than the five-year average.

(2:33)
So far this year, demand for other than American cheese varieties have been strong. Exports in May and April were impressive, while domestic consumption for other cheese was up as well in the April Supply & Utilization Report, which may help explain the pull on inventories.

If you are looking for a more comprehensive take on this report, HighGround’s in-depth analysis will be available to our subscribers on our website tomorrow, and if you have any questions in the meantime, feel free to contact us at info@highgrounddairy.com. I’m Cara Murphy signing off, have a great week, and we look forward to talking with you soon.

The post Dairy Skim – May 2024 US Cold Storage Report appeared first on HighGround Dairy.