Friday Closing Dairy Market Update - Class III Milk Futures Close Higher for the Week

GENERAL OVERVIEW:

Cheese prices were lower, but Class III futures held up well. Traders seem to have a sense that the market may find a bottom soon, even though it has yet to find that bottom. After four weeks of trading, spot barrels finally have a load traded.

MILK:

Surprisingly, Class III futures closed higher for the week despite a significant decline in spot cheese prices. It seemed that traders might have turned less bearish on the market, feeling that cheese prices are nearing the lows. The weakness of milk futures has been depressing, as it appears milk prices in December may be significantly lower than they were in November. The only consolation we can take is that low prices will cure low prices. However, the duration of the low prices can extend for a significant amount of time. Concern has developed recently over the weakness seen in the cattle market and the impact on calf prices. However, the impact may be short-lived as cattle prices have rebounded over the past eight days. Calf prices should remain strong as long as cattle supplies remain tight.

AVERAGE CLASS III PRICES:

3 Month:	$15.61
6 Month:	$15.91
9 Month:	$16.31
12 Month:	$16.60

CHEESE:

For the week, the block cheese price fell 9.00 cents with 34 loads traded. The barrel cheese price fell 17.00 cents with one load traded. This was the first load traded over the past four weeks. Despite the weakness of cheese, Class III futures closed higher for the week. Traders seem to be reducing some of the bearishness they have been carrying for quite some time. The thinking may be that the market has limited downside from here. The dry why price increased 1.25 cents this week, with four loads traded.

BUTTER:

For the week, butter increased 2.75 cents with 25 loads traded. Grade A nonfat dry milk increased 2.75 cents with 14 loads traded. Butter futures close higher for the week, but traders showed little conviction that the price has much upside potential.

OUTSIDE MARKETS SUMMARY:

March corn closed down 2.50 cents per bushel at $4.4475, January soybeans closed down 14.25 cents at $11.0525 and January soybean meal closed down $3.80 per ton at $307.40. March Chicago wheat closed down 4.50 cents at $5.3575. February live cattle closed up $3.15 at $227.15. January crude oil is up $0.41 per barrel at $60.08. The Dow Jones Industrial Average is up 104 points at 47,955, with the NASDAQ up 73 points at 23,578.

Friday Midday Dairy Market Summary - Cheese Moves to New Lows

OUTSIDE MARKETS SUMMARY:

CORN:	1 Lower
SOYBEANS:	13 Lower
SOYBEAN MEAL:	$3.50 Lower
LIVE CATTLE:	$5.75 Higher
DOW JONES:	163 Points Higher
NASDAQ:	55 Points Higher
CRUDE OIL:	$0.36 Higher

MIDDAY MARKET UPDATE:

The block cheese price declined 1.50 cents, closing at $1.38 with 10 loads traded. The barrel cheese price declined 3.25 cents, closing at $1.4125 with one load traded. This is the first load traded over the course of four weeks. The dry whey price held steady at 74.50 cents with one load traded. Class III futures reversed course with most contracts showing losses. Futures are 23 cents lower to 15 cents higher with double-digit gains showing in the fourth quarter 2026 contracts. The butter price increased 0.75 cent to close at $1.4750 with 10 loads traded. Grade A nonfat dry milk increased 0.50 cent to close at $1.17 with no loads traded. Class IV has only traded in the August contract at an unchanged price. Butter futures are 0.22 to 1.50 cents lower. Dry whey futures are 0.75 to 1.22 cents lower. Cheese futures are 0.50 to 1.90 cents lower.

Friday Morning Dairy Market Update - Traders Take a Wait-and-See Attitude

OPENING CALLS:

Class III Milk Futures:	4 to 6 Higher
Class IV Milk Futures:	Mixed
Butter Futures:	Steady to 1 Higher

OUTSIDE MARKET OPENING CALLS:

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

MILK:

The strength in milk futures Thursday did not carry over into the overnight session. Trading activity may be light ahead of the spot trading session with traders waiting to see what the cash prices will do. There is little to get excited about as strength in cash may be short-lived. Milk supplies are sufficient to meet demand. Without greater fundamental support, most of the trading activity is confined to scalping the market for quick profits if the short-term direction is correctly guessed. The Dairy Product report will not be released today as originally scheduled. The reports for both September and October will be released on Dec. 15, bringing the reports up to date.

CHEESE:

It is uncertain which direction cheese prices will move during spot trading. This may leave Class III futures mixed with limited trading activity until spot trading takes place. If cheese prices increase, traders may not be aggressive buyers as the strength may be limited. However, current prices may hold as low prices may increase demand.

BUTTER:

The butter price has increased for three consecutive days. The trend higher may be limited, but hopefully, demand has improved sufficiently to at least keep the price from moving to a new low. It would be a victory if the price can find stability for a while.