Friday Closing Dairy Market Update - September Milk Production Report to be Released Monday

OVERVIEW:

Milk futures did not change much today due to limited price movement in the spot market. Class III futures were slightly higher while Class IV futures were mostly lower. Butter and cheese prices showed significant declines for the week.

MILK:

Both Class III and Class IV milk futures declined for the week, with Class IV contracts showing the greatest losses. The weakness of the underlying cash kept the pressure on prices. Unfortunately, this is not expected to change anytime soon. At best, we can hope for some stability to be maintained moving through the rest of the year. Futures throughout 2026 do not look very profitable at this point, but a lot can change over the next 12 months. The current fundamentals and the time of year do not hold much hope for improving milk prices anytime soon. The USDA will release the delayed September Milk Production report on Monday. This was a critical report for Dairy Revenue Protection insurance as it finished out the quarter of coverage. Without the report, the quarterly coverage could not be calculated, and this was delaying payouts of the insurance coverage.

AVERAGE CLASS III PRICES:

3 Month:	$16.90
6 Month:	$16.79
9 Month:	$16.94
12 Month:	$17.14

CHEESE:

For the week, block cheese fell 10.75 cents with 25 loads traded. The weekly average price was $1.6560. Barrel cheese fell 10.50 cents with no loads traded. The weekly average price was $1.71. Either the supply of barrels is tight and there is little available to be offered on the spot market, or the demand is lighter, and buyers have no need to come to the spot market to buy. It is definitely seen that there is limited interest either way. The dry whey price for the week remained unchanged at 71.00 cents with four loads traded. The weekly average price is 71.40 cents.

BUTTER:

For the week, butter fell 13.50 cents with 22 loads traded. The weekly average price is $1.4995. Grade A nonfat dry milk declined 1.25 cents with six loads traded. The weekly average price was $1.1345. Solid support remains uncertain but may develop as the holiday season approaches.

OUTSIDE MARKETS SUMMARY:

December corn closed down 1.50 cents per bushel at $4.2725, January soybeans closed up 9.50 cents at $11.1700 and December soybean meal closed up $4.40 per ton at $317.10. December Chicago wheat closed down 7.75 cents at $5.2775. December live cattle closed up $2.58 at $221.35. December crude oil is up $0.38 per barrel at $59.81. The Dow Jones Industrial Average is up 75 points at 46,987, with the NASDAQ down 49 points at 23,005.

Friday Midday Dairy Market Summary - Milk Futures Show Light Trading Activity

OUTSIDE MARKETS SUMMARY:

CORN:	1 Lower
SOYBEANS:	8 Higher
SOYBEAN MEAL:	$3.20 Higher
LIVE CATTLE:	$2.17 Higher
DOW JONES:	202 Points Lower
NASDAQ:	280 Points Lower
CRUDE OIL:	$0.33 Higher

MIDDAY MARKET UPDATE:

Both block and barrel cheese prices remained unchanged at $1.66 and $1.70 respectively. No trades took place in the spot market. There was an unfilled bid and an uncovered offer remaining at the close in blocks with no buying or selling interest shown for barrels. The dry whey price remained unchanged at 71.00 cents with no loads traded. Class III futures are 7 cents lower to 10 cents higher. The butter price increased 0.25 cent, closing at $1.4750 with one load traded. Grade A nonfat dry milk increased 0.75 cent, closing at $1.1450 with five loads traded. Class IV futures have not yet been traded. Butter futures are 3.25 cents lower to 1.15 cents higher. Dry whey futures are 0.37 to 2.00 cents higher. Cheese futures are 0.40 cent lower to 0.50 cent higher.

Fluid Milk and Cream - Western U.S. Report 45

In the West, California week over week milk production varies from steady to somewhat stronger. Handlers report October 2025 year over year milk production is significantly higher, and October 2025 milk volumes are up compared to September 2025. Some manufacturers convey milk intakes are above anticipated volumes. Stakeholders note open processing capacity is tight primarily due to planned and unplanned downtime at processing facilities as opposed to increases in farm level milk output making processing capacities tight. 

In Arizona and New Mexico, milk production varies from steady to somewhat stronger as well. 

Farm level milk output in the Pacific Northwest varies from steady to lighter. Some manufacturers note milk intakes and manufacturing at their processing facilities are lower than anticipated. 

In the mountain states of Idaho, Utah, and Colorado, milk production is steady. Manufacturers indicate contractual milk volumes are being received, and spot milk loads are available. Manufacturers note projects for additional Class II processing capacity within the mountain states area are on or ahead of schedule. Class I demand is strong and Class II, III, and IV demands are steady throughout the region. 

Cream remains readily available in the West. Cream demand is stronger. Cream multiples moved higher this week. Condensed skim milk demand and availability are unchanged.