Friday Closing Dairy Market Update - September Cold Storage Report Released

GENERAL OVERVIEW:

Natural cheese stocks and butter stocks were both down from last month's report, however still higher than September 2025. Grade A Nonfat Dry Milk falls the limit or near the futures daily limit after another tough day in the spot market.

MILK:

Class III Milk was mostly lower this afternoon with the December down 42 cents while the October fell 4 cents. The milk production report was mostly as expected this week with less milk produced from last month by quite a bit more milk produced when compared to last year. Class IV Milk did not trade today. For the week, Class III climbed 38 cents on the November contract peaked mid week with the highest levels traded since June. On the spot market, NFDM had 17 loads traded this week for a weekly average of $2.1550, which was down 5.55 cents from last week's average.

AVERAGE CLASS III PRICES:

3 Month:	$16.63
6 Month:	$16.74
9 Month:	$16.90
12 Month:	$17.09

CHEESE:

Cheddar blocks had 19 loads traded this week at an average price of $1.7385. That is 19.90 cents higher than last week's weekly average of $1.5395. Cheddar barrels climbed 8 cents this week with no loads traded for an average of $1.7040, up 19.45 cents from last week's average price. Dry Whey started the week off on Monday with an all-time high price traded of 89.5 cents but fell 5.25 cents to today's close of 84.25 cents. The current weekly average with 1 load traded this week, came in at 86.35 cents, down 1.95 cents from last week's average. The Cold Storage report showed the total natural cheese stocks in refrigerated warehouses fell 1 percent from last month but were 2% higher than September 2025. American cheese stocks were 792,213,000 pounds, down 2% from both last month and last year. Swiss was down 4% from last month at 22,868,000 pounds, yet up 8% year over year. Other natural cheeses totaled 613,475,000 pounds which was an increase of 8% year over year but close to last month's total.

BUTTER:

Butter had 30 loads traded this week with a decline of 4.5 cent from Monday. The current weekly average is $1.3490, which is 3.80 cents higher than last week's average price of $1.3110. On the Cold Storage Report today, butter stocks were 295,673,000, which was down 5% from one month ago yet 16% higher than September 2025. This does help explain some of the recent buying seen, but overall, the market is still sitting on a large volume of butter stocks.

OUTSIDE MARKETS SUMMARY:

December corn closed down 4.50 cents per bushel at $4.5600, November soybeans closed up 3.50 cents at $12.5650 and December soybean meal closed down $1.20 per ton at $346.10. December Chicago wheat closed up .25 cent at $6.2500. 

Friday Midday Dairy Market Update - Spot Cheese Blocks and Butter Higher

OUTSIDE MARKETS SUMMARY:

CORN:	4 Lower
SOYBEANS:	5 Higher
SOYBEAN MEAL:	$0.10 Lower
LIVE CATTLE:	$0.225 Higher
DOW JONES:	546 Points Lower
NASDAQ:	17 Points Higher
CRUDE OIL:	$3.40 Higher

MIDDAY MARKET UPDATE:

The block cheese price increased 1 cent to close at $1.7350 with one load traded. The barrel cheese price was unchanged at $1.7200 with no loads traded. Dry whey was unchanged at 84.25 cents with no loads traded. Class III futures are 45 cents lower to 29 cents higher. The butter price increased by 1 cent, closing at $1.3400 with one load traded. Grade A nonfat dry milk decreased 4 cents to close at $2.0950 with five loads traded. Class IV futures have not yet been traded Friday. Butter futures are 0.275 to 1.05 cents lower. Dry whey futures are unchanged to 0.575 cents lower. Cheese futures are 0.275 cents to 0.5750 cents lower. Nonfat dry milk futures are 3.4 to 4 cents lower.

Friday Morning Dairy Market Update - Cold Storage Report To Be Released Today

OPENING CALLS:

Class III Milk Futures:	10 to 35 Lower
Class IV Milk Futures:	5 to 10 Lower
Butter Futures:	1 to 2 Lower

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	1 to 2 Lower
Soybean Futures:	1 to 2 Higher
Soybean Meal Futures:	$0.50 to $1.00 Higher
Wheat Futures:	1 to 4 Lower

MILK:

The September Milk Production report was released Thursday afternoon. While milk production was lower than last month, it was still well above September 2025 by 2.7%. We have a greater number of milk cows this year as well as more production per cow. The biggest states for growth were Kansas and South Dakota. The third quarter of 2026 produced 59.5 billion pounds of milk, which is 2.3% more than last year. The drop from September to October was somewhat expected, but it is well overshadowed by the big year-over-year increases we've seen nearly every Milk Production report this year.

CHEESE:

Overnight trade for cheese is weaker, trading 0.3 to 3.7 cents lower. The expectation for trade Friday is neutral given the weight the market is putting on the Cold Storage report set to be released Friday afternoon. If the spot market is any indication, inventories may be feeling pretty tight this month as buyers position themselves ahead of the holiday season.

BUTTER:

Overnight trade has been quiet, much like we expect to see in the day trade Friday. Just like cheese, the Cold Storage report will bring a lot of answers to questions on inventories for butter. The holiday baking season is around the corner and if the market feels overstocked or tight, it can make a big difference in how the futures markets trade.