Friday Closing Dairy Market Update - Hay Stocks Decline 3.3% From a Year Ago

GENERAL OVERVIEW:

Both Class III and Class IV futures closed lower for the week. Class III showed greater losses. Grain prices were under pressure from the disappointment that China did not commit to increasing grain purchases. Hay stocks on May 1 were 3.3 percent below a year ago.

MILK:

Both Class III and Class IV milk futures closed lower than at the end of last week. Class III futures were under greater pressure as spot cheese prices declined. Nearby Class III futures continue to roll down as premiums are eliminated from contracts as time moves on. As long as spot prices show limited upside potential, this will continue to take place. Hay stocks on May 1 totaled 23.3 million tons, down 3.3 percent from a year earlier. The state with the largest decline in stocks was Utah, down 41 percent. Wisconsin and New York were 35 percent lower. Texas declined 33 percent, with Colorado down 32 percent. Stocks of hay in West Virginia were 153 percent higher than a year ago. Ohio was 119 percent higher, Kansas was 70 percent higher, and Nevada was 44 percent higher. Grain prices fell over the past two days due to the disappointment that China did not commit to purchasing more grain this year during the Trump visit.

AVERAGE CLASS III PRICES:

3 Month:	$17.20
6 Month:	$17.88
9 Month:	$18.02
12 Month:	$17.95

CHEESE:

For the week, blocks declined 6.75 cents with 24 loads traded. The weekly average price is $1.6035 per pound. Barrels declined 4.50 cents with no loads traded. The weekly average price is $1.5850 per pound. Dry whey declined 1.50 cents with 4 loads traded. The weekly average price is 68.70 cents per pound. The block price fell to the lowest price since April 9 and is at the bottom end of the wide trading range.

BUTTER:

For the week, butter declined 2.50 cents with 99 loads traded. The weekly average price is $1.6385 per pound. Grade A nonfat dry milk declined 1.75 cents with 28 loads traded. The weekly average price is $2.2810 per pound. The weakness of dry whey is a concern, as it gives the impression that the price has reached a plateau. This may pressure Class IV futures if it continues next week.

OUTSIDE MARKETS SUMMARY:

July corn closed down 11.75 cents per bushel at $4.5575, July soybeans closed down 15.50 cents at $11.7700, and July soybean meal closed up $1.80 per ton at $334.30. July Chicago wheat closed down 22.25 cents at $6.3575. June live cattle closed up $1.83 at $253.90. June crude oil is up $4.32 per barrel at $105.49. The Dow Jones Industrial Average is down 537 points at 49,526, with the NASDAQ down 410 points at 26,225.

Friday Midday Dairy Market Summary - Further Weakness Develops

OUTSIDE MARKETS SUMMARY:

CORN:	11 Lower
SOYBEANS:	17 Lower
SOYBEAN MEAL:	$1.50 Higher
LIVE CATTLE:	$1.55 Higher
DOW JONES:	435 Points Lower
NASDAQ:	231 Points Higher
CRUDE OIL:	$3.97 Higher

MIDDAY MARKET UPDATE:

The block cheese price declined 1.50 cents to close at $1.5550 with five loads traded. The barrel cheese price mirrored the block also with a decline of $1.50, closing at $1.5550 with no loads traded. The dry why price gained a penny to close at 68.50 cents with one load traded. Class III futures are 12 cents lower to 2 cents higher with only September posting a gain. The butter price slipped 0.50 cent to close at $1.6400 with 23 loads traded. There were 17 unfilled bids and 8 uncovered offers remaining at the close of spot trading. Buyer interest is good, but they remain unaggressive as sellers continue to offer supplies. Grade A nonfat dry milk slipped 0.25 cent to close at $2.2725 with one load traded. Class IV futures are 2-9 cents higher. Butter futures are 0.47 cent lower to 2.90 cents higher. Dry whey futures are 0.42 cent lower to 0.25 cent higher. Cheese futures are 0.60 cent lower to 0.60 cent higher.

Friday Morning Dairy Market Update - Milk Futures May Find Little Direction

OPENING CALLS:

Class III Milk Futures:	Mixed
Class IV Milk Futures:	Mixed
Butter Futures:	1 to 2 Higher

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	2 to 3 Lower
Soybean Futures:	4 to 5 Lower
Soybean Meal Futures:	$1 to $2 Lower
Wheat Futures:	5 to 6 Lower

MILK:

The decline in cheese prices on Thursday was a surprise and will increase the caution of traders. It seemed the maket had been finding support with spot prices trading in a tight range. However, Thursday's decline indicates support remains elusive. Continued strong milk output and steady cheese production will keep the market supplied. Schools are closing and will close over the next few weeks, with more milk moving to manufacturing. Milk production provides no indication of slowing anytime soon. Trading activity may be light ahead of spot trading as traders are uncertain whether buyers will step up in the spot market to take advantage of the weakness in cheese or if further weakness may take place if buyers hold back.

CHEESE:

Cheese supplies are sufficient for demand, with increasing milk availability keeping manufacturing strong. Plants may move cheese to the spot market as quickly as possible to keep inventory from building.

BUTTER:

Traders will be cautious over whether the butter price has much further upside potential in the near term. The market has yet to break out of an overall downtrend despite the rebound from the lows two weeks ago. Strong butter production keeps the supply readily available to the market and spot trading activity significant.