Butter – YOY Production Declines 4.8% YOY, Reaches Four Year Low for the Month of February According to USDA, Feb ’15 U.S. butter production of 156.1 million pounds declined 4.8% YOY and 3.8% MOM on a daily average basis. The 4.8% YOY decline was the largest experienced in the past 11 months on a percentage basis while the January – February seasonal decline of 3.8% was significantly larger than the five year average January – February decline of 0.6%. Butter production for the month of February declined to a four year low, with Feb ’15 production falling 6.7% below the previous three year average February production. ’14-’15 YTD butter production is down 0.9% through the first five months of the production season. Cheese – Production Remains Strong, up 3.9% YOY to New February High Feb ’15 total cheese production of 884.3 million pounds increased YOY for the 23rd consecutive month, finishing 3.9% higher than last year and setting a new production record for the month of February. Total cheese production also increased 0.2% MOM on a daily average basis, finishing at the sixth highest monthly figure on record. Cheddar cheese production of 257.3 million pounds remained strong, increasing 3.4% YOY to a new February high. ’14-’15 YTD cheese production is up 2.9% through the first five months of the production season with cheddar cheese production up 3.2% over the same period. The 2.9% increase in annual cheese production would be an eight year high, with the 3.2% increase in cheddar cheese production on pace to reach a six year high. Dry Whey – Production Increases Sharply YOY Feb ’15 U.S. dry whey production of 78.0 million pounds increased 25.7% YOY and 14.3% MOM on a daily average basis as manufacturers continue to shift away from higher-value whey protein products. The YOY increase in whey protein production was the largest in over 33 years on a percentage basis. Combined whey protein concentrates (WPC) and whey protein isolates (WPI) production declined by 10.6% YOY, the largest percentage decline in over five and a half years. Combined WPC and WPI production increased by 18.3% YOY throughout the ’13-’14 production season but has dropped below last year’s levels throughout the first five months of the ’14-’15 production season, down 2.3% YTD. ’14-’15 YTD dry whey production is up 2.3% YOY, with total combined dry whey, WPC and WPI production up 0.1% YOY through February. NFDM/SMP – Combined Production Remains Higher on YOY Basis, up 2.6% Feb ’15 U.S. NFDM production of 148.1 million pounds increased YOY for the tenth consecutive month, finishing up 5.4%. NFDM production declined slightly MOM on a daily average basis, finishing 0.6% lower than Jan ’15 production levels. Feb ’15 SMP production of 32.4 million lbs declined YOY for the ninth consecutive month, falling 8.3%. SMP, which is more suited to the requirements of most global markets, has experienced YOY production declines as powder exports have begun to experience relative weakness. Powder exports have declined by 15.6% YOY from Aug ’14 – Feb ’15 after increasing for 15 of the previous 16 months. Feb ’15 combined production of NFDM and SMP increased 2.6% YOY, the 12th consecutive monthly increase in production. ’14-’15 YTD combined U.S. NFDM and SMP production is up 10.7% through the first five months of the production season. See the table below for a summary of key U.S. dairy product production in Feb ’15.