CHICAGO -- Dairy market analyst Jerry Dryer said he expects the per-pound price of 40-pound blocks of cheddar cheese to rise to $1.25 by the end of June, and as high as $1.40 by July or August. On June 11, blocks traded at $1.14 on the Chicago Mercantile Exchange (CME).
According to a Dairyline report, Dryer, editor of Dairy & Food Market Analyst newsletter, is convinced milk production is below year-ago levels and will remain that way.
Dryer also believes the USDA's estimate of dairy cows culled from the nation's herds is too low, and that they'll be adjusted accordingly when the May figures are released.
According to the report, contacts Dryer talked to at the June 1-3 International Dairy Deli Bakery Association show in Las Vegas were more optimistic than he's seen them in a long time.
"Cheese makers and cheese marketers were wearing big smiles, and peddlers don't smile unless they're selling something," he told Dairyline.
A strike looming at a major Upper Midwest cheese processor, however, could slow a cheese price increase, Dryer said. Without a workforce, 500-pound barrels of cheddar might be moved from inventory, intended for process cheese, to the CME.