Friday Midday Dairy Market Summary - Butter Reverses the Weakness

OUTSIDE MARKETS SUMMARY:

CORN:	5 Higher
SOYBEANS:	18 Higher
SOYBEAN MEAL:	$2.20 Higher
LIVE CATTLE:	$0.62 Lower
DOW JONES:	9 Points Higher
NASDAQ:	380 Points Higher
CRUDE OIL:	$0.81 Higher

MIDDAY MARKET UPDATE:

The block cheese price declined 0.75 cent to close at $1.6225 with two loads traded. The barrel cheese prices remained unchanged at $1.60 with no loads traded. The dry whey price increased 0.50 cent to close at 70.00 cents with two loads traded. Class III futures are 11 cents lower to 6 cents higher. The butter price gained 3.50 cents to close at $1.6650 with twenty-two loads traded. The price fluctuated from a low of $1.63 to a high of $1.67 before settling 0.50 cent off the high. There were 6 unfilled bids and 17 uncovered offers remaining at the close. Apparently, the sellers see no need to be aggressive but may wait to see if buyers will come up to their offers. Grade A nonfat dry milk declined 0.50 cent to close at $2.2900 with one load traded. Class IV futures from 21 cents lower to 15 cents higher. Butter futures 0.77 -- 6.50 cents higher. Dry whey futures are steady to 1.00 cent higher. Cheese futures are 1.70 cents lower to 0.10 cent higher.

Friday Morning Dairy Market Update - Further Weakness Expected in Spot Prices

OPENING CALLS:

Class III Milk Futures:	4 to 8 Lower
Class IV Milk Futures:	2 to 5 Lower
Butter Futures:	Mixed

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	Mixed
Soybean Futures:	1 to 2 Higher
Soybean Meal Futures:	Mixed
Wheat Futures:	1 to 2 Higher

MILK:

Thursday's weakness of the underlying cash did not put as much pressure on milk futures as would have been expected. However, overnight trade indicates further weakness today. There has been no fundamental change in the market. This may keep spot prices in a range and Class III milk futures under pressure. Class IV futures have benefited from continued strength in nonfat dry milk. Cow numbers continue to increase with farm expansions taking place. This is likely to continue under the current market fundamentals.

CHEESE:

Cheese prices have been unable to break out of the trading range despite good domestic and international demand. The current supply is sufficient, leaving buyers unaggressive. There is no concern over a tight supply. Prices are expected to move sideways at least through the spring flush.

BUTTER:

There is caution now that the spot butter price slipped on Thursday; it could go back down to the lows or below. That has been the previous pattern. The price is certainly low enough to generate buyer interest, but so far, they have not had to be aggressive.

Thursday Closing Dairy Market Update - The Global Dairy Trade Price Gains 1.5%

GENERAL OVERVIEW:

Class III futures were lower in response to the decline in cheese prices, but losses were kept to a minimum. The spot market proved again today that the upside price potential is likely limited for the time being and maybe for much of the rest of the year. The Global Dairy Trade auction increased 1.5 percent.

MILK:

There was hope that the pattern of an increase of a day or two would change, but that was not the case. Spot prices came under pressure as buyers stepped back again. This continues to add to the overall weakness of the Class III market. As long as strong milk production remains, it will be difficult for the market to see much upside. The Global Dairy Trade auction took place earlier this week, with the trade-weighted average increasing 1.5 percent from the previous event. There were 13,743 metric tons sold at an average price of $4,127 per metric ton. Anhydrous milk fat increased 1.1 percent to $6,461 per metric ton or $2.93 per pound. Butter declined 2.6 percent to $5,525 per metric ton or $2.51 per pound. Buttermilk gained 9.0 percent to $3,467 per metric ton or $1.57 per pound. Cheddar cheese declined 3.6 percent to $4,611 per metric ton or $2.09 per pound. Lactose gained 3.7 percent to $1.522 per metric ton or $0.69 per pound. Skim milk powder gained 3.0 percent to $3,547 per metric ton or $1.61 per pound. Whole milk powder gained 2.2 percent at $3,741 per metric ton or $1.70 per metric ton. Mozzarella gained 4.7 percent to $4,010 per metric ton or $1.82 per pound.

AVERAGE CLASS III PRICES:

3 Month:	$17.69
6 Month:	$18.17
9 Month:	$18.18
12 Month:	$18.03

CHEESE:

Reports from the Western region indicate that the peak of spring flush is more sustained this year than usual. This continues to provide plentiful milk supplies for cheese production. The Dairy Products report released on Wednesday showed American cheese output a year earlier, but that has had no impact on supporting cheese prices.

BUTTER:

The sufficient supply of milk and cream available is a broken record, as it has not changed much over quite some time. Butter production continues to run seven days a week as churns utilize the available cream supplies. International demand remains strong as the U.S. price is nearly $0.90 per pound below the world price.

OUTSIDE MARKETS SUMMARY:

July corn closed down 1.00 cent per bushel at $4.6750, July soybeans closed down 2.50 cents at $11.9225 and July soybean meal closed up $1.60 per ton at $318.90. July Chicago wheat closed down 5.00 cents at $6.1225. June live cattle closed down $3.43 at $250.05. June crude oil is up $0.54 per barrel at $95.62. The Dow Jones Industrial Average is down 314 points at 48,597, with the NASDAQ down 33 points at 25,806.