Executive Summary

U.S. cold storage figures provided by the USDA were recently updated with values spanning through Dec ’21. Highlights from the updated report include:

• Dec ’21 U.S. butter stocks declined contraseasonally to a two year low level, finishing 27.3% below previous year levels. Despite declining on a YOY basis, butter stocks remained at the second highest seasonal level experienced throughout the past 28 years.
• Dec ’21 U.S. cheese stocks remained at a record high seasonal level for the eighth consecutive month, finishing 3.5% above previous year levels. On a days of usage basis, Dec ’21 cheese stocks finished slightly below previous year levels, however.

Additional Report Details

Butter – Stocks Decline Contraseasonally to a Two Year Low Level, Finish 27.3% Lower YOY

According to the USDA, Dec ’21 U.S. butter stocks declined contraseasonally to a two year low level, finishing 27.3% below previous year levels. The YOY decline in butter stocks was the fifth experienced in a row and the largest experienced throughout the past seven years on a percentage basis. Butter stocks had finished above previous year levels over 25 consecutive months through Jul ’21, prior to declining on a YOY basis over the five most recently available data points.

The month-over-month decline in butter stocks of 11.4 million pounds, or 5.4%, was a contraseasonal move when compared to the ten year average November – December seasonal build of 12.0 million pounds, or 8.0%. The November – December decline in butter stocks was the largest experienced throughout the past 17 years on an absolute basis. Butter stocks typically reach seasonal low levels throughout the month of November, prior to rebounding seasonally throughout the month of December and the first half of the following calendar year. Despite declining on a YOY basis, butter stocks remained at the second highest seasonal level experienced throughout the past 28 years.

On a days of usage basis, Dec ’21 U.S. butter stocks also finished below previous year levels. When assuming 12-month rolling average YOY changes in usage rates and known stock values for the month of Dec, butter stocks on a days of usage basis declined YOY for the sixth consecutive month, finishing down 30.1%.

Cheese – Stocks Remain at a Record High Seasonal Level, Finish 3.5% Higher YOY

Dec ’21 U.S. cheese stocks rebounded seasonally from the ten month low level experienced throughout the previous month while finishing 3.5% above previous year levels, reaching a record high seasonal level for the eighth consecutive month. The YOY increase in cheese stocks was the 13^th experienced throughout the past 14 months but the smallest experienced throughout the past six months on a percentage basis.

American cheese stocks finished 5.6% higher on a YOY basis throughout the month while other-than-American cheese stocks finished 0.7% above previous year levels. The month-over-month increase in cheese stocks of 22.8 million pounds, or 1.6%, was slightly larger than the ten year average November – December seasonal build of 14.0 million pounds, or 1.2%.

On a days of usage basis, Dec ’21 U.S. cheese stocks finished below previous year levels, however. When assuming 12-month rolling average YOY changes in usage rates and known stock values for the month of December, cheese stocks on a days of usage basis declined YOY for the first time in the past four months, finishing down 0.4%.

Combined Dairy Product Stocks – Dec ’21 Stocks Projected to Remain Below Previous Year Levels

Combined stocks of butter, cheese, dry whey and nonfat dry milk finished 1.3% below previous year levels throughout Nov ’21, finishing lower on a YOY basis for just the second time in the past 22 months. Combined stocks of butter, cheese, dry whey and nonfat dry milk are projected to remain below previous year levels throughout Dec ’21 when using actual butter and cheese stock figures and previous month YOY changes in dry whey and nonfat dry milk stocks, declining by an estimated 4.5% on a YOY basis. Dec ’21 dry whey and nonfat dry milk stock figures are scheduled to be available Feb 4^th.