Class II Butterfat Price is based upon announced component prices (butterfat price) which are obtained by a monthly average of NASS weekly prices over 4 or 5 different weeks. These are released on a Friday on or before the 5th of every month, for the previous month. For example, the component prices for Oct 2009 was announced on Oct 30, 2009.
The component prices calculated in the section use monthly average U.S. NASS survey prices. These monthly average prices are calculated by a weighted average.
The monthly average prices used in this section are calculated from NASS prices for each week.
These monthly average prices are as follows:
| AA Butter | 1.2245 |
| Cheddar Cheese | 1.4110 |
| Dry Whey | 0.3183 |
| Nonfat Dry Milk | 1.0270 |
= (AA Butter Avg – 0.1202) *1.2
= (1.2245 – 0.1202) * 1.2
= 1.1043 * 1.2
= 1.3252
So, the Announced Butterfat Component Price for Oct 2009 is 1.3252 $/lb.
= Announced Butterfat Price + $0.0070
= 1.3252 + $0.0070
= 1.3322
So, the Announced Class II Butterfat Price for Oct 2009 is 1.3322