Tuesday Morning Dairy Market Update - Week Full of Market News and Reports

OPENING CALLS:

Class III Milk Futures:	10 to 25 Higher
Class IV Milk Futures:	5 to 10 Higher
Butter Futures:	Mixed

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	1 to 2 Higher
Soybean Futures:	3 to 5 Higher
Soybean Meal Futures:	$2.50 to $3.00 Lower
Wheat Futures:	4 to 5 Higher

MILK:

Milk futures have been on a big run up with support coming from product sold within the daily spot trade. With the amount of data that will be available this week from reports to the Global Dairy Trade (GDT) Auction, we will see how much of this recent rally can hold up to the news cycle. The Milk Production report has been reducing production expectations, yet the amount of milk the United States has produced this year is a daunting total.

CHEESE:

Cheese has also had an impressive rally lately. The GDT Auction was not friendly to cheese on the previous report. Cheddar and mozzarella were both down 3.9% and 3.7%, respectively. With the current cash trade so strong, futures have rallied quickly. From a world standpoint, is the strength seen over the last week only a U.S. buying story, or will the world see it as too expensive?

BUTTER:

Butter was relatively flat during the last GDT Auction. Most likely, the Cold Storage report later this week will give the market a better look at the current butter supply on hand. Many regions have struggled with available supply of 82% butterfat butter, but have expressed plenty of supply of 80% is available.

Monday Closing Dairy Market Update - Monday Dairy Rally

GENERAL OVERVIEW:

It has been a strong start to the week as nearly every category of dairy products is trading higher going into the evening. The spot market has brought in additional demand as the calendar inches closer to the holidays.

MILK:

Class III milk futures are anywhere from 6 cents higher on the October contract to 45 cents higher on the more heavily traded November contract. Class IV futures are also rallying into the close, trading anywhere from 45 to 62 cents higher. With last Friday's outlook report released by USDA, production forecasts were down from last month's outlook report by 0.3 billion pounds of milk. While this seems like a big drop, it is still a total of 236.9 billion pounds in 2026, one of the highest productions forecasted that the U.S. has ever produced. The main focus of demand has been in higher-value protein products which have had a tighter supply with much of the fluid milk being sent to bottling.

AVERAGE CLASS III PRICES:

3 Month:	$16.81
6 Month:	$17.12
9 Month:	$17.28
12 Month:	$17.41

CHEESE:

Cheese continued the strength seem last week in the spot market which has been reflected in the futures market. Today, futures closed 0.7 to 4.1 cents higher. Buyers have been stocking up for upcoming holiday demand, and it has created a short-term buying frenzy trying to get their hands on supply. Some of the price actions the market has seen this month could be considered a rebound from a tough September. The next cold storage report will be a better indicator of the state of cheese available to the market and if this price strength continues.

BUTTER:

Butter futures were a bit disappointing towards the end of the trading day as the November contract settled 4 cents off the midday high of the day. Cash trade was higher today, but the actual loads traded were still minimal. Buyers have been stepping in to buy spot loads over the last week because prices were low and the holiday baking season is around the corner. What hasn't changed is the availability of cream which is still plentiful. Fundamentally, butter has some strong resistance to a long-term price increase.

OUTSIDE MARKETS SUMMARY:

December corn closed down 7.25 cents per bushel at $4.670; November soybeans closed down 7.75 cents at $12.5350 and December soybean meal closed down $2.30 per ton at $354.80. December Chicago wheat closed down 5.25 cents at $6.5525.

December live cattle closed down $0.325 at $228.025. November crude oil is up $2.25 per barrel at $103.66. The Dow Jones Industrial Average is down 36 points at 51,966 and the NASDAQ is up 290 points at 26,430.

Monday Midday Dairy Market Summary - Higher Cash Trade

OUTSIDE MARKETS SUMMARY:

CORN:	7 Lower
SOYBEANS:	10 Lower
SOYBEAN MEAL:	$0.39 Lower
LIVE CATTLE:	$1.375 Higher
DOW JONES:	15 Points Lower
NASDAQ:	330 Points Lower
CRUDE OIL:	$1.51 Higher

MIDDAY MARKET UPDATE:

The block cheese price increased 4.75 cents to close at $1.73 with 3 loads traded. The barrel cheese price increased 2 cents to close at $1.6400 with no loads traded. The dry whey price set is unchanged at the all-time high price of 89.5 cents. There were no loads traded. Class III futures are 7 to 41 cents higher. The butter price closed 2 cents higher at $1.3850 with 1 load traded. A nonfat dry milk increased 3.75 cents to close at $2.200 with 3 loads traded. Class IV futures are 40 cents to 69 cents higher in the deferred. contracts. Butter futures are 0.5 to 2.425 cents higher. Dry whey futures are unchanged. Cheese futures are 0.8 to 3.8 cents higher. Nonfat dry milk futures are 2.90 to 8 cents higher.