Wednesday Midday Dairy Market Summary - Cash Butter Prices Lead Complex Higher

OUTSIDE MARKETS SUMMARY:

CORN:	3 1/4 Lower
SOYBEANS:	3 Higher
SOYBEAN MEAL:	$3.60 Higher
LIVE CATTLE:	$3.55 Higher
DOW JONES:	226 Points Higher
NASDAQ:	3 Points Lower
CRUDE OIL:	$4.41 Lower

MIDDAY MARKET UPDATE:

Class III milk futures are mixed in a narrow to moderate trading range Wednesday morning with soon-to-expire spot month May contracts gaining 1 cent per cwt at $16.91 per cwt. June contracts continue to be the most actively traded market in the complex, but wide morning swings in outside markets seem to have moved trader interest from fundamental market moves, focusing on potential technical pressure following the Memorial Day holiday. June futures are trading at $16.49 per cwt, currently 11 cents per cwt lower. The rest of the complex remains mixed in a very narrow range from 5 cents lower to 4 cents per cwt higher, with prices through late summer and early fall starting to gain momentum based on potential strong dairy demand and milk supply tightness due to seasonal trends. Cash cheese prices remain mixed in moderate trade activity with block prices increasing 0.5 cent per pound, moving to $1.4975 per pound with eight loads of block cheese selling on the exchange. Barrel cheese trade remained sluggush with just two loads traded, as prices fell 3 cents per pound, to $1.44 per pound. Butter prices were the bright spot of the entire dairy complex, moving 6 cents per pound higher, to $1.62 per pound. Continued active trade in the butter exchange posted 14 loads of butter selling Wednesday, pushing the holiday-shortened week total to 50 loads already this week. Traders will closely monitor all cash market movement through the rest of the week, in order to get a better handle on post-holiday buyer demand.

Wednesday Morning Dairy Market Update - Price Strength May Be Difficult to Maintain

OPENING CALLS:

Class III Milk Futures:	2 to 10 Higher
Class IV Milk Futures:	2 to 5 Lower
Butter Futures:	Steady to 1 Higher

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	1 to 2 Lower
Soybean Futures:	1 to 2 Lower
Soybean Meal Futures:	Steady to $1 Higher
Wheat Futures:	7 to 9 Lower

MILK:

There seems to be little change in the market as farms continue to push milk production and increase cow numbers. It is more than just holding onto cows to produce another calf, but the increase in longevity of the cow due to improved genetics is building the herd. Milk production per cow remains strong, indicating there are not a lot of low-producing cows in the dairy herd. The capacity to process more milk has been added and is being added with the expectation of increased milk supply. Farmers are embracing the ability to increase milk production. The only thing to slow milk output in the near term will be the weather. However, that will be minimized due to advances in keeping cows comfortable.

CHEESE:

Increased cheese production has moved the block cheese price to the lowest level since Feb. 17. More milk is being made available to the vat. This allows for increased cheese production, with plants wanting to move it to the spot market rather than build inventory.

BUTTER:

The increase in the butter price was welcomed over the past two days, but it may be short-lived or have limited upside potential. The fact that April inventory was 9.0 percent below a year ago is not impacting the desire of plants to move supplies to keep plant inventories from building.

Tuesday Closing Dairy Market Update - April Cold Storage Increased From a Year Ago

GENERAL OVERVIEW:

It was another negative day for milk futures, with Class IV contracts posting greater losses than Class III. The April Milk Production report was bearish. Milk production was up 2.7 percent, with cow numbers up 10,000 head.

MILK:

Milk futures left much to be desired today as the underlying cash provided little support. The strength in dry whey was offset by the weakness in cheese. The strength in butter was offset by the weakness of nonfat dry milk. This left Class III milk futures lower while putting substantial pressure on Class IV futures. The weakness of nonfat dry milk is eliminating a substantial amount of premium from Class IV futures. The April Milk Production report showed the trend for continued higher milk production and cow numbers. There were 5 of the top 24 states that showed a decrease in milk production from 2025. Washington showed the largest decline of 7.0 percent. Pennsylvania declined 2.0 percent, Virginia was down 0.8 percent, Vermont was down 0.5 percent, and New Mexico declined 0.4 percent. The largest percentage increase was seen in Kansas with an increase of 23.7 percent. Oregon was up 7.4 percent, South Dakota gained 6.3 percent, Indiana was up 5.6 percent, and both Colorado and Georgia were up 5.1 percent. The rest of the gains were less than 5.0 percent.

AVERAGE CLASS III PRICES:

3 Month:	$16.79
6 Month:	$17.33
9 Month:	$17.55
12 Month:	$17.58

CHEESE:

The April Cold Storage report showed American cheese inventory increased 12.0 million pounds from March to 817.6 million pounds. This is 1 percent below April 2025. Swiss cheese inventory totaled 24.9 million pounds. This was 115,00 pounds above March and was 8 percent above a year ago. Other cheese inventory totaled 575.2 million pounds, down 1 percent from a year ago. Total cheese inventory reached 1.418 billion pounds, up 12.4 million pounds from March, but down 1 percent from April 2025.

BUTTER:

The spot butter price closed higher with a significant volume of 36 loads changing hands.

The April Cold Storage report showed butter stocks increased 18.3 million pounds from March, totaling 308.2 million pounds. Even though inventory increased, stocks are 9.0 percent lower than a year ago.

OUTSIDE MARKETS SUMMARY:

July corn closed down 5.75 cents per bushel at $4.5750, July soybeans closed down 10.50 cents at $11.8600, and July soybean meal closed down $3.30 per ton at $328.60. July Chicago wheat closed down 10.75 cents at $6.3550. August live cattle closed down $0.45 at $239.15. July crude oil is down $2.71 per barrel at $93.89. The Dow Jones Industrial Average is down 118 points at 50,462, with the NASDAQ up 312 points at 26,656.