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NATIONAL - DEC. 17: Cheese plant managers report milk is still snug, but influxes are expected to increase over the upcoming holiday weeks, as Class I and some Class III plants take some time off. Spot milk prices in the Midwest ranged from Class III up to $.50 over Class. Cheese production is generally busy. Staffing shortages remain a common theme among contact notes, but most plant managers are making due with lighter crews. Cheese demand is falling in two columns: steady and busy. Cheese inventories are adequate.

NORTHEAST - DEC. 22: Steady milk supplies are clearing to Class III. Production is active for Cheddar, Provolone, and Mozzarella, but some Northeastern cheese makers will pause operations over the holiday. Cheese inventories are ample. Retail sales remain strong. Many grocery chains are offering cheese promotions in weekly ads. Foodservice demand is a little softer. Educational institutions are closing for winter breaks, and eatery traffic is said to be down as would-be diners face Omicron uncertainties and strengthening restrictionss. Reports indicate that some restauranteurs are limiting services or temporarily closing locations amid the challenges of staffing shortages and rising COVID case counts.

MIDWEST AREA - DEC. 22: Midwestern cheese makers reported spot milk prices at expected discounts, below $1-under Class III, but compared to the holiday week last year, milk is notably less available; prices were as low as $8.50 under on Dece. 23, 2020. Demand for cheese has been very steady in recent weeks/months. Some curd producers reported taking advantage of a slower ordering week to work on plant maintenance. Employee numbers are fair, although some plant managers continue to report that they are not comfortable with current shifts, and a lot of attending employees are working long days. Cheese availability is balanced to tight in the region. Cheese price movements are somewhat steady this week, but the large gap remains. Market participants say the $.20+ price gap between blocks and barrels on the CME leaves near term bullishness in doubt.

WEST - DEC. 22: Demand for cheese is mixed; retail sales are steady while foodservice demand is declining. Contacts report that foodservice sales have softened as schools are closing for winter break. International demand for cheese is strong, with contacts noting steady purchases of cheese for export to Asian markets. Deliveries continue to face delays due to port congestion and a shortage of truck drivers. Spot purchasers report no change in availability for either cheese barrels or blocks. Some market participants are, reportedly, accepting lower prices to move loads before the end of the year. Cheese makers say that milk is available for production in the region, though some are running decreased schedules.

FOREIGN -TYPE CHEESE - DEC. 22: The Western European cheese situation is described as an insufficient supply, lower than demand. Orders have experienced cuts in shipments. Manufacturers are sometimes forced to make tough decisions allocating available stocks, even sometimes shorting long-term customers. Retail customers as well as foodservice destinations are jockeying for restocking priority. With constrained cheese production reflecting tight milk supplies, as well as low existing stocks, this situation is expected to continue for a while. Projections for 2022 are for slightly more cheese production.

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