Basis Loaded – February 28, 2024

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00;00;00;20 – 00;00;08;27
VOICEOVER
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00;00;08;29 – 00;00;50;18
JOE
Hello and welcome to the February 28th edition of Bases Loaded with Joe Schmitt. I am just met. This episode, as always, is produced by Paige Driscoll, with help from the ever agg insights team. What we do here is break down the latest from the piece I report. Let’s start with butter. This butter number coming in at two 7707 is a plus five to the seeming one week average of two 7240 good volume here on the Indy PSR to coincide with that nice basis plus five is of course well above our expected to sound positive basis and here at £4.8 million, well above our expected 3.5 million, we did trade 24 loads on the CME last

00;00;50;18 – 00;01;15;16
JOE
week so that should help a lot on all. In terms of both price and sales volume, I’d have to say that this is a win for the manufacturer. We’re in butter. Next, let’s move on to the cheese complex where the story is not as rosy. This block number coming in at one 6502 represents a plus four to the seen the one week average of one 6105.

00;01;15;17 – 00;01;36;26
JOE
Now this one 61.5 see me weekly average is one week off of the high we’ve yet to see. I mean that was of course last week last week on the Indy PSR we had negative basis that February 17th release of 160 to 63 was negative to the semi weekly average that highly and this week basis recovers a little bit.

00;01;37;01 – 00;02;03;24
JOE
Seeing the weekly average move down three and the Indy PSR up two and a half. So we had a basis recovery and that’s how we ended up at that plus four. So basis moving around in the black, what is consistent is dismal volume. This volume now under £11 million, four out of last five weeks and a 10.1 this week, call it a full two, almost two and a half million pounds are expected volume level.

00;02;03;24 – 00;02;27;15
JOE
So this block pieces this week, a plus four is a nice number. But at that number, the manufacturer sacrificed sales with total volume falling well below. It’s interesting that on this cheese rally, the block has gone from trading in a ten cent premium to the barrel to where it stands today or worse than that, earlier this week at $0.10 under.

00;02;27;15 – 00;02;57;16
JOE
So the rally and cheese, it seems, has come at the expense of the block in barrels. One 5924 That is a plus one to see me two week average of one 5870 plus one. That’s well below our expected basis. We expect typically a 4 to 6 cent positive basis here. The manufacture to had to discount to move way and similar to the block was unable to move a whole lot of weight, only £12.7 million.

00;02;57;16 – 00;03;26;19
JOE
So 800,000 under our expected 13.5 lower than expected basis. This is what six loads traded on the CME so low volume at see me not a whole lot 2.2 there on off for the cheese complex disappointing price on anemic volume. Up next is a shining star of the dairy complex driveway 4979. That’s a minus one to see me one week average of 5075, but just an outstanding price.

00;03;26;19 – 00;03;58;11
JOE
4979, almost a full nickel over the February 10th and PSR of 4498. And at that elevated level, the manufacturer was able to move above our expected £4.5 million coming in at almost 4.7 million. The manufacturer called a five cent premium to prior weeks extended PSR. So the prices at the CME are reflected here on the Indy PSR as the way complex continues to move higher.

00;03;58;11 – 00;04;15;25
JOE
It will be interesting in the weeks to come to see how the Andy Serwer reacts to the lower levels that we’re seeing at the CME. I would expect that just as it behaved on the way up, the losses at the CME will be slow to get in on the way back down as they were slow to arrive to the PSR during the course of this rally.

00;04;15;29 – 00;04;48;08
JOE
And then lastly, non fat one 2021 that represents a minus one and a half to see me one with an average of one 2175. We treated 15 loads on the CME last week, so not a lot to add to the any PSR volume. However, any PSR volume looking pretty good here coming in just short of £20.9 million. If you go back over the last 12 months, the average NDP SA volume has been 20.2 million, the six month average a little bit below that coming in at 16.8 million.

00;04;48;08 – 00;05;11;21
JOE
So whatever reference point you choose to use, this week’s volume is a little bit above. So the manufacturers sacrifice price a little bit, taking a one and a half cent discount to the semi weekly average, but was able to move a fair amount of volume. So we’ll call it a win for the non fat manufacturer. So this is week four of four for the February pricing cycle.

00;05;11;21 – 00;05;40;26
JOE
February Class three expired at 1608 would be February, Class four all the way up at 1985. If you carry current see me cheese nonfat whey, see me equivalence out through the five week march pricing cycle currently getting March class 317 even March class for 1980. We’ll see what they have in store for us in the weeks to come on behalf of page and the entire ever EG team.

00;05;40;26 – 00;05;43;12
JOE
Thanks so much. We’ll see you next week by.