News

Cheese 42 cents per pound higher than Jan. '04

January 19, 2005

Cheddar block prices rose two-and-a-half cents in Jan. 20 trading on the Chicago Mercantile Exchange to close at $1.72 per pound.

According to data from the University of Wisconsin-Madison, for the last quarter century, January block prices have hovered in the $1.20 to $1.30 range in January.

This year's prices are 32 percent higher than last year's.

The high-water marks nearest present prices were weekly averages of $1.43 posted in 1998, and $1.49 in 1990. A year ago today, blocks sold for $1.30, 42 cents below today's price.

What's driving prices? Strong holiday sales and preparations for the upcoming Super Bowl have made a dent in the nation's cheese supplies, leaving manufacturers pressured to replace those stocks.

Correspondingly, milk futures prices are rising, which could help keep cheese costs above average.

* Operator Impact
         Operators who buy ...
     — 500 pounds of cheese a week will pay $210 more
     — 1,000 pounds of cheese a week will pay $420 more
     — 1,500 pounds of cheese a week will pay $630 more

Read more in our Cheese Market Analysis Research Center.