Wednesday Closing Dairy Market Update - March Milk Production Up 2.3%

GENERAL OVERVIEW:

Milk futures did not increase as much as anticipated with the increase in block cheese and nonfat dry milk. March milk production was 2.3% above March 2025, with cow numbers up 8,000 head from February, totaling 9.621 million head.

MILK:

As the day progressed, Class IV futures weakened as traders seemed to take profits after early price strength. Near the end of the day, the May and June contracts posted double-digit losses. That may not be where they are settled for the day due to the CME settling the contracts two hours before trading closes. That is why the end-of-the-day trading does not always coincide with settlement prices. The March Milk Production report showed production in the top 24 states up 2.4% over March 2025. Production per cow averaged 2,133 pounds, up 7 pounds from a year ago. Cow numbers were 8,000 head more than in February. Milk production in the U.S. increased 2.3% from March 2025. Production per down averaged 2,119 pounds. Cow numbers increased by 8,000 head from February, totaling 9.621 million head. First-quarter milk production was 2.9% higher than the same period in 2025.

AVERAGE CLASS III PRICES:

3 Month:	$17.42
6 Month:	$18.12
9 Month:	$18.31
12 Month:	$18.14

CHEESE:

The block cheese price increased but moved within the recent sideways price range. The price is expected to remain supported, but range-bound in the near term. Trading interest has increased with 38 loads traded so far this week. Buyers are purchasing to increase ownership, while sellers want to limit the buildup of inventory at the plant level.

BUTTER:

Butter continues to have a difficult time finding support. It looked like the price was going to settle at another new low this month, but buying interest increased during spot trading, bringing the price up from the lows. There were 75 loads traded so far this week.

OUTSIDE MARKETS SUMMARY:

May corn closed up .50 cent per bushel at $4.5425, May soybeans closed down 10.00 cents at $11.6450 and July soybean meal closed down $4.90 per ton at $316.30. July Chicago wheat closed down 5.75 cents at $6.0700. June live cattle closed down $0.48 at $243.08. June crude oil is up $3.21 per barrel at $92.88. The Dow Jones Industrial Average is up 341 points at 49,490, with the NASDAQ up 398 points at 24,658.

March Milk Production up 2.4 Percent

March Milk Production up 2.4 Percent        

Milk production in the 24 major States during March totaled 19.6 billion pounds, up 2.4 percent from March 2025. February revised production, at 17.5 billion pounds, was up 3.0 percent from February 2025. The February revision represented a decrease of 11 million pounds or 0.1 percent from last month's preliminary production estimate.  Production per cow in the 24 major States averaged 2,133 pounds for March, 7 pounds above March 2025.   The number of milk cows on farms in the 24 major States was 9.18 million head, 188,000 head more than March 2025, and 8,000 head more than February 2026.   

January-March Milk Production up 2.9 Percent  

Milk production in the United States during the January - March quarter totaled 58.5 billion pounds, up 2.9 percent from the January - March quarter last year.  The average number of milk cows in the United States during the quarter was 9.61 million head, 50,000 head more than the October - December quarter, and 204,000 head more than the same period last year. 

Wednesday Midday Dairy Market Summary - Nonfat Dry Milk Marches Higher

OUTSIDE MARKETS SUMMARY:

CORN:	1 Higher
SOYBEANS:	7 Lower
SOYBEAN MEAL:	$2.60 Lower
LIVE CATTLE:	$1.25 Lower
DOW JONES:	295 Points Higher
NASDAQ:	344 Points Higher
CRUDE OIL:	$3.23 Higher

MIDDAY MARKET UPDATE:

The block cheese price increased 3.00 cents, closing at $1.6300 with 11 loads traded. No unfilled bids or uncovered offers remained at the close of spot trading. Interest in doing business has been strong so far this week, with 38 loads changing hands. The barrel cheese price remained unchanged at $1.5750 with no loads traded. The dry whey price increased 0.50 cent to close at 70.50 with one load traded. Class III futures are 13 cents lower to 13 cents higher. The butter price decreased 2.00 cents, closing at $1.70 with 17 loads traded. The price initially decreased by 4.75 cents before buying interest gained back some of the loss. Grade A nonfat dry milk increased 3.50 cents to close at $2.25 with six loads traded. There is no end in sight to the price strength. Class IV futures are 15 to 32 cents higher. Butter futures are 1.27 to 7.32 cents lower. Dry whey futures are 0.65 to 1.75 cents higher. Cheese futures are 0.60 cent lower to 1.00 cents higher. The March Milk Production report will be released Wednesday. I estimate milk output to be up 2.7% from March 2025, with cow numbers up 5,000 head from February.