How to read the table
Dairy prices move through a chain. Raw milk sets the cost of every product. USDA classes price milk by its use. CME spot prices and futures set the benchmarks that contracts follow. This table puts 48 of those elements on one page, in eight rows, so a buyer, a seller and a risk manager can see how one price drives the next.
Each cell shows the element number, its price unit, a short symbol and its name. Read the rows from top to bottom to follow milk from the farm, through products and markets, to the hedge and the metrics that track it.
- ID
- Market number
- Unit
- Price unit
- SYM
- Trading symbol
- Name
- Product or instrument
Periodic Table of Dairy Pricing and Risk
1 Raw inputs
- 1$/cwtRMRaw Milk
- 2$/lbBFButterfat
- 3$/lbPRProtein
- 4$/lbLCLactose
- 5IndexENEnergy
2 USDA classes
- 6$/cwtCIClass I
- 7$/cwtCIIClass II
- 8$/cwtCIIIClass III
- 9$/cwtCIVClass IV
3 Physical products
- 10$/lbChCheddar
- 11$/lbMoMozzarella
- 12$/lbCCCream Cheese
- 13$/lbBuButter
- 14$/lbWhWhey
- 15$/lbNFNFDM
- 16$/galYoYogurt
- 17$/galFMFluid Milk
- 18$/lbICIce Cream
- 19$/lbPCProcess Cheese
4 CME spot prices
- 20$/lbBlCME Block
- 21$/lbBaCME Barrel
- 22$/lbBtCME Butter
- 23$/lbWyCME Whey
- 24$/lbNMCME NFDM
5 Futures contracts
- 25200K lbsM3Class III Fut
- 26200K lbsM4Class IV Fut
- 2744K lbsCSCheese Fut
- 2844K lbsDWDry Whey Fut
- 2940K lbsBTButter Fut
- 3044K lbsNFNFDM Fut
- 3144K lbsBCBlock Cheese
6 Options
- 32OptionsO3Class III Opt
- 33OptionsO4Class IV Opt
- 34OptionsOCCheese Opt
- 35OptionsOWWhey Opt
- 36OptionsOBButter Opt
7 Risk management
- 37StrategyHdHedging
- 38StrategyBsBasis Mgmt
- 39StrategyCrCrush Spread
- 40StrategySwSwaps
- 41StrategyClCollar
- 42StrategyStStrip Hedge
8 Analytics
- 43MetricMgMargin Track
- 44MetricCrCorrelation
- 45MetricVoVolatility
- 46MetricEfEffectiveness
- 47MetricHRHedge Ratio
- 48MetricPLP&L Track
Reference guide
Pricing formulas
| Model | Formula |
|---|---|
| Cost plus | Psell = Pmilk ÷ Y − Cwhey + Cprocessing + Mmargin |
| Index based | Psell = Pindex ± Basis |
| Multi component | Pcream cheese = 0.4 × Pbutterfat + 0.6 × PNFDM + Cproc + Mmargin |
| Milk crush margin | Crush margin = (Pcheese × Ycheese + Pwhey × Ywhey) − Pmilk |
| Basis | Basis = Mailbox price − Class III milk price |
Market interaction patterns
| Type | Elements | Relationship |
|---|---|---|
| Vertical flow | RM → CI → Ch → Bl → M3 | Supply chain progression |
| Horizontal groups | Ch, Mo, CC in row 3 | Substitutable products |
| Derivative chains | M3 → O3 (Class III to options) | Financial derivatives |
| Basis relationships | Ch ↔ Bl (Cheddar ↔ CME Block) | Price correlation |
| Hedge complexes | RM + M3 + CS combinations | Risk management strategies |
| Processing margins | Input costs against output values | Profitability analysis |
Raw inputs (row 1)
| Symbol | Element | Unit and role |
|---|---|---|
| RM | Raw Milk | $/cwt, the major cost driver |
| BF | Butterfat | $/lb, a high value component |
| PR | Protein | $/lb, sets quality |
| LC | Lactose | $/lb, a processing factor |
| EN | Energy | Index, operating costs |
USDA classes (row 2)
| Symbol | Element | Primary use |
|---|---|---|
| CI | Class I | Drinking milk, the highest price |
| CII | Class II | Yogurt, ice cream |
| CIII | Class III | Hard cheeses, the key benchmark |
| CIV | Class IV | Butter, powder |
Physical products (row 3)
| Symbol | Element | Market role |
|---|---|---|
| Ch | Cheddar | Major cheese benchmark |
| Mo | Mozzarella | Follows cheddar pricing |
| CC | Cream Cheese | Linked to butterfat |
| Bu | Butter | Class IV driver |
| Wh | Whey | Revenue credit |
CME spot markets (row 4)
| Symbol | Element | Function |
|---|---|---|
| Bl | CME Block | Primary cheese index |
| Ba | CME Barrel | Process cheese index |
| Bt | CME Butter | Daily price discovery |
| Wy | CME Whey | Byproduct valuation |
| NM | CME NFDM | Protein pricing |
Futures and options (rows 5 and 6)
| Symbol | Element | Size or type |
|---|---|---|
| M3 | Class III Futures | 200K lbs |
| M4 | Class IV Futures | 200K lbs |
| CS | Cheese Futures | 44K lbs |
| O3 | Class III Options | Various |
| O4 | Class IV Options | Various |
| OC | Cheese Options | Various |
Risk management and analytics (rows 7 and 8)
| Symbol | Element | Purpose |
|---|---|---|
| Hd | Hedging | Price protection |
| Bs | Basis Management | Correlation risk |
| Cr | Crush Spread | Margin hedging |
| Mg | Margin Tracking | Profitability |
| Vo | Volatility | Risk measurement |
| HR | Hedge Ratio | Position sizing |
Download the table and the guide as a PDF, or read how the elements work together in the dairy pricing and hedging white paper.
Put the table to work
Vadar Alpha connects these prices to what your plants buy, make and sell, so each hedge follows real usage.