If your January cheese case looks a little thinner on margin than your November one did, you're not imagining it. Block and barrel prices came off their late-fall highs through the month, with barrels trading roughly a third lower than their November peak and blocks following a similar path. Class III milk pricing softened along with them, which is the usual January pattern after a holiday-driven run, but the drop this year has been sharper than most members expected walking out of a strong close to 2019.
None of that changes the make sheet. It changes what you can afford to pay for milk this quarter and what you should be quoting a retail partner for a spring order. If you haven't run your own numbers since before the holidays, now's the week to do it — a stale margin assumption is worse than no assumption at all.
A longer runway on trade
There's a more encouraging thread running underneath the short-term price dip. A new North American trade agreement cleared its final legislative vote earlier this month and is headed for signature, and the dairy provisions in it matter more to our members than most of the rest of the deal. It widens U.S. dairy access into the Canadian market beyond what an earlier, now-defunct trade framework would have provided, and it retires a Canadian milk-pricing mechanism that domestic producers have argued undercut U.S. exports for several years. It also adds new tools for pushing back on geographical-indication filings that would otherwise lock up common cheese-style names — the kind of dispute that has occasionally caught smaller U.S. producers off guard when they went to label a wheel "feta" or "asiago" for an export market.
None of that shows up in this week's spot price. Trade provisions like these take months to work through actual shipping volume, and the Canadian pricing change in particular phases in over a longer window. But for members thinking about whether to invest in export documentation or a first international buyer relationship this year, it's a meaningfully friendlier horizon than the one we were describing a year ago.
What we're watching
Export demand is the number to keep an eye on heading into spring. Early signals point to stronger cheese and milk-powder export volume in 2020 than in 2019, which would help absorb some of the domestic oversupply that's been leaning on block and barrel prices since fall. If that materializes, the current softness in the case is more likely to look like a seasonal dip than the start of a longer slide.
In the meantime, a few practical notes for members watching their own numbers this week:
- If you sell on a formula tied to Class III or NDPSR, pull your February pricing sheet now rather than waiting for the invoice to land.
- If you're weighing a first export shipment for later this year, the Membership & Outreach Committee can connect you with members who've been through the paperwork already.
- If a retail buyer pushes back on a February quote, the case for holding your price is stronger this month than it was in November — cost inputs haven't dropped nearly as fast as the shelf price has.
We'll keep tracking both threads — the near-term price and the longer trade picture — as the year opens.
The International Cheese Federation (ICF) and More Cheese are entirely fictional. This post is demonstration content created for MemberJunction. All people, organizations, events, courses, certifications, figures, and quotations in it are invented, and nothing here represents a real association, a real business, a real person, or real professional advice.