CheeseCHE

About Cheese (CHE)

Cheese futures (CHE) track the CME benchmark for 500-pound blocks of cheddar cheese, the primary indicator for US cheese market pricing. Cheese is the largest single use of US milk, accounting for about 40% of all milk produced in the country.

Cheese Price Drivers

Cheese prices are influenced by global supply and demand dynamics, geopolitical events, weather patterns, currency fluctuations, and economic indicators. Futures contracts traded on exchanges like COMEX, NYMEX, and ICE provide price discovery, while physical market conditions and inventory levels drive spot pricing.

Frequently Asked Questions

What do cheese futures represent?

CME cheese futures (CHE) represent 20,000 pounds of cheddar cheese and are cash-settled against the CME block cheddar spot price. They are used by cheese manufacturers, distributors, and food companies to hedge price risk. The US produces over 14 billion pounds of cheese annually.

What drives cheese prices?

Cheese prices are driven by milk supply and production costs, domestic consumption trends (US per-capita cheese consumption has grown steadily for decades), restaurant and food service demand, export demand (particularly from Mexico, Japan, and South Korea), and government purchases for food programs.

How does cheese affect milk prices?

Cheese prices are a primary determinant of Class III milk prices through the federal milk pricing formula. When cheese prices rise, the Class III milk price increases, directly benefiting dairy farmers. About 40% of US milk production goes into cheese manufacturing.