Monday Closing Dairy Market Update - Positive Start to the Week

GENERAL OVERVIEW:

Class IV milk traded higher this afternoon as butter and non-fat dry milk both climbed midday.

MILK:

Class III milk was mixed this afternoon with nearly even trade across all board months. Traders are unwilling to take a long position with the March Milk Production report to be released later this week. Expectations are for higher milk production, so it is difficult to get excited about small rallies in the market when we are facing such a massive production number. Class IV milk did rally with strength in the cash market, trading 12 to 22 cents higher at the end of the trading day.

AVERAGE CLASS III PRICES:

3 Month:	$17.21
6 Month:	$17.97
9 Month:	$18.18
12 Month:	$18.04

CHEESE:

Cheese blocks found some strength today in the cash market, which bled through to the futures market earlier this afternoon but lost a little steam by the close. Cheese futures closed mixed, up 1.1 cents to down 0.6 cents. The retail market is steady, and traders expect flat trading to go forward over the next few weeks.

BUTTER:

After late last week's sharp decline in the butter price, butter made a nice comeback in the cash market today, closing up 4.5 cents. What was most notable is the volume that traded today with 49 loads exchanging hands. A mix between the buyers seeing it as a sign to take advantage of a big pullback in prices after last Tuesday's demand spike, as well as sellers happily letting go of excess product on hand. The futures market closed up 1.1 cents to 3.475 cents.

OUTSIDE MARKETS SUMMARY:

May corn closed up 3.25 cents per bushel at $4.5200, May soybeans closed down 1.50 cents at $11.6575 and July soybean meal closed down $6.00 per ton at $321.20. July Chicago wheat closed up 6.75 cents at $6.0600. June live cattle closed down $1.28 at $246.08. June crude oil is up 4.83 per barrel at $87.42. The Dow Jones Industrial Average is down 4 points at 49,442 and NASDAQ is down 64 points at 24,404.

Monday Midday Dairy Market Summary - Butter Buyers Galore

OUTSIDE MARKETS SUMMARY:

CORN:	4 Higher
SOYBEANS:	1 Higher
SOYBEAN MEAL:	$0.50 Lower
LIVE CATTLE:	$1.30 Lower
DOW JONES:	68 Points Lower
NASDAQ:	104 Points Lower
CRUDE OIL:	$4.63 Higher

MIDDAY MARKET UPDATE:

The block cheese price increased 0.75 cent to close at $1.5850 with no loads traded. The barrel cheese price remained unchanged at $1.5750 with no loads traded and still no bids or offers yet Monday. The dry whey price increased by 1 cent closing at 70.00 cents with no loads traded. Class III futures are trading 1 cent to 30 cents higher. The butter price rallied 4.5 cents, closing at $1.7350 with 49 loads traded. Grade A nonfat dry milk remained unchanged at $2.20 with no loads traded, and 3 bids left unfulfilled at the close. Class IV futures are 2 to 20 cents higher. Butter futures are 1.725 cents higher to 2.675 cents higher. Dry whey futures are 0.4 cents lower to 0.45 cents higher. Cheese futures are 0.1 cents higher to 2.5 cents higher.

Monday Morning Dairy Market Update - Uncertainty Dominates the Market

OPENING CALLS:

Class III Milk Futures:	5 to 8 Higher
Class IV Milk Futures:	Mixed
Butter Futures:	1 to 2 Higher

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	Steady to 1 Higher
Soybean Futures:	Mixed
Soybean Meal Futures:	$2 to $3 Lower
Wheat Futures:	6 to 8 Higher

MILK:

It may be difficult for Class III milk futures to regain the recent losses and to trend higher. The upside price potential may be limited due to the spring flush, increasing the available milk supply. The March Milk Production report will be released on Wednesday and is expected to show higher milk output than a year ago. The percent of gain will not be as much due to the strong year-over-year gains last year. However, the gain should be significant. This trend is expected to continue this year as cow numbers increase. The Class IV price is a different story as nonfat dry milk continues to increase due to tight supplies.

CHEESE:

Cheese prices are potentially establishing a sideways pattern for the time being. The fundamentals are not supportive enough to regain the losses and develop an uptrend. Cheese production is increasing as milk receipts are higher at the plant level. Demand is good, keeping inventory slightly below a year ago, but it is not good enough to turn buyers aggressive.

BUTTER:

The butter price is unable to find support. Recent price strength has been met with further weakness as the price falls below the previous low. Manufacturers continue to move supplies to the market even though inventory is below that of a year ago. Buyers continue to purchase butter, but they are holding back and purchasing at lower prices.