The monthly benchmark milk price set by the U.S. Department of Agriculture has reached its highest level in a year and a half.

The May Federal Order Class III price was announced June 5 at $16.38 per hundredweight, up 42 cents from April and $1.20 above May 2018. It is the highest Class III price since November 2017.

The rising prices are welcome news to dairy producers still feeling financial hardship from four years of low milk prices and global trade challenges. And farmers need ongoing relief.

The May price equates to $1.41 per gallon, up from $1.37 in April and $1.31 a year ago. The Class III average stands at $15.05, up from $14.25 a year ago but  below $16.05 in 2017.

The May Class IV price is $16.29, up 57 cents from April and $1.72 above a year ago, and at the highest level since August 2017.

Dairy product prices at the Chicago Mercantile Exchange started June Dairy Month looking for direction. Block cheddar slowly climbed to $1.7525 per pound by Friday, up 3.75 cents on the week and 11.75 cents above a year ago, and the highest since November 2017.

The barrels fell to $1.4850 on June 4, lowest price since March 13, and 25.5 cents below the May $1.74 peak. They finished Friday at $1.5350, a half-cent lower on the week, 3 cents below a year ago, and 21.75 cents below the blocks.

Dairy Market News reports that cheese orders are picking up “noticeably,” according to producers of multiple varieties. Milk suppliers say some cheese makers are looking to take more milk for the near term. Milk supplies were comparatively snug.

Western cheese makers have mixed views on demand. Specialty and value-added cheeses have strong buyer interest and overall domestic retail demand is steady.

FC Stone dairy broker Dave Kurzawski, on the June 10 Dairy Radio Now broadcast, said the “tighter than expected milk supplies” are “the main underlying factor for the market.” He sees 2019 milk output as being up only 0.2 percent from 2018.

Butter closed the week at $2.3975, up 3.75 cents, three-quarter cents above a year ago and a penny shy of the year’s high on May 27.

DMN says expectations lean to a tighter fall season than in previous years. The latest production decreases “symbolize near-future trends,” according to some. Others warn that increasing imports will keep butter markets in check. Butter market tones are steady, but some traders expect 2019 will present “a new, higher ceiling.”

Western butter output is active, with schedules booked from day to day. Cream inventories are tightening although still available to satisfy butter makers.

Grade A nonfat dry milk closed Friday at $1.0550 per pound, unchanged on the week but 25 cents above a year ago.

Spot dry whey saw a Friday finish at 36.5 cents per pound, up 1.25 cents on the week but 4.75 cents below a year ago.

The Northwest Dairy Association makes these price projections for the Class III price and Pacific Northwest blend price:

Month   Class         PNW

             III           Blend 

May    $16.38      $16.60


June   $16.05       $16.80

July     $16.10      $17.20

Aug.    $16.40      $17.30

Sept.    $16.80     $17.45

Oct.     $17.10      $17.45

Nov.     $17.00      $17.40

Dec .    $16.70      $17.20

Jan.      $16.30      $16.90

Lee Mielke, of Lynden, is editor of the Mielke Market Weekly. Whatcom County has about 85 dairy farms.