Monday Morning Dairy Market Update - Traders Found Positive News

OPENING CALLS:

Class III Milk Futures:	6 to 10 Higher
Class IV Milk Futures:	Mixed
Butter Futures:	Steady to 1 Higher

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	10 to 13 Higher
Soybean Futures:	3 to 5 Lower
Soybean Meal Futures:	$1 to $2 Higher
Wheat Futures:	12 to 14 Higher

MILK:

The July Milk Production report may be the reason for significant trading activity in Class III futures overnight. There was strong volume for an overnight market, with the August and September contracts trading more than 100 contracts. This strength may be the reaction to U.S. cow numbers in July remaining unchanged from June. This may indicate the strong increase in the dairy herd may have run its course. It has been quite some time since cow numbers have not increased from the previous month, and traders are taking note of it. The market will need to prove itself before traders turn bullish. The USDA will release the July Cold Storage report Monday afternoon.

CHEESE:

Cheese prices are expected to remain choppy. Milk output continues to exceed a year ago and cooler weather has allowed milk production to rebound somewhat. Sufficient milk is available for bottling and manufacturing.

BUTTER:

The butter price is expected to remain choppy. Manufacturers are building some inventory but also are moving quite a bit to the market. There has been no shortage of offers on the spot market, which has limited the upside price potential. The nonfat dry milk price may have reached a threshold.

Friday Closing Dairy Market Update - Class III Futures Showed Further Losses

GENERAL OVERVIEW:

Class III milk futures closed mixed, experiencing some pressure from the slight decline in cheese prices. Class IV futures came under pressure as the day progressed due to the weakness in nonfat dry milk, as traders focused on the weakness rather than the strength of butter. July milk production was 2.2% above a year ago.

MILK:

Milk futures closed the week without fanfare. Class IV futures showed weakness as traders focused on the weakness of nonfat dry milk. July milk production in the top 24 states was 2.3% higher than a year ago, totaling 19.4 billion pounds. Milk production in June was revised 0.7% higher, increasing 3.1% from June 2025. That was an unusually large revision. Milk production per cow in July averaged 2,093 pounds, or 5 pounds above a year ago. Cow numbers increased by 2,000 head, totaling 9.27 million head. U.S. milk production was 2.2% above July 2025, totaling 20.1 billion pounds. Output per cow was 2,075 pounds, or 3 pounds above a year ago. Cow numbers were unchanged from June. The nation's dairy herd was 199,000 head more than a year ago at 9.71 million head. The growth in cow numbers has slowed, but milk production has not.

AVERAGE CLASS III PRICES:

3 Month:	$16.76
6 Month:	$17.10
9 Month:	$17.23
12 Month:	$17.34

CHEESE:

For the week, blocks declined 7.25 cents with 10 loads traded. The weekly average price is $1.5620. Barrels remained unchanged with no loads traded. The weekly average price is $1.5650. Dry whey increased 1.25 cents with two loads traded. The weekly average price is 69.75 cents. Blocks ran into headwinds this week with the price closing the week 0.75 cent above the low from August 5.

BUTTER:

For the week, butter increased 0.25 cent with 60 loads traded. The weekly average price is $1.4510. Grade A nonfat dry milk increased 5.50 cents with 41 loads traded. The weekly average price is $1.7925. Nonfat dry milk may have reached a level of price resistance. The July Cold Storage report will be released on Monday and will show if inventory has increased due to strong output.

OUTSIDE MARKETS SUMMARY:

December corn closed up 5.00 cents per bushel at $5.0850, November soybeans closed up 3.00 cents at $12.3950, and December soybean meal closed up $2.00 per ton at $325.80. December Chicago wheat closed down 0.75 cent at $6.9925. October live cattle closed down $0.08 at $217.93. October crude oil is up $0.23 per barrel at $87.06. The Dow Jones Industrial Average is up 518 points at 53,277, with the NASDAQ up 113 points at 26,180.

July Milk Production in the United States up 2.2 Percent

July Milk Production up 2.3 Percent        

Milk production in the 24 major States during July totaled 19.4 billion pounds, up 2.3 percent from July 2025. June revised production, at 19.1 billion pounds, was up 3.1 percent from June 2025. The June revision represented an increase of 124 million pounds or 0.7 percent from last month's preliminary production estimate.  Production per cow in the 24 major States averaged 2,093 pounds for July, 5 pounds above July 2025.   The number of milk cows on farms in the 24 major States was 9.27 million head, 185,000 head more than July 2025, and 2,000 head more than June 2026.   

July Milk Production in the United States up 2.2 Percent  

Milk production in the United States during July totaled 20.1 billion pounds, up 2.2 percent from July 2025.  Production per cow in the United States averaged 2,075 pounds for July, 3 pounds above July 2025.  The number of milk cows on farms in the United States was 9.71 million head, 199,000 head more than July 2025, but unchanged from June 2026.