Wednesday Closing Dairy Market Update - Federal Order Class Prices Released

GENERAL OVERVIEW:

Federal Order class prices were revealed by USDA today. Class II and III were both lower while Class IV some modest gains from last month.

MILK:

While the October futures price still remained below the $15 mark today, deferred months found a little support during the trading session gaining 11 to 24 cents. Class IV was also mixed with the October contract trading 1 cent lower but the deferred months were around 25 cents higher. USDA released class and component prices today. Class II was $17.60, $1.11 lower than last month and Class III fell 60 cents from the August price coming in at $16.04 here in September. Class IV price was $18.94 per hundredweight, an increase of $1.58 from the previous month.

AVERAGE CLASS III PRICES:

3 Month:	$15.42
6 Month:	$15.98
9 Month:	$16.34
12 Month:	$16.64

CHEESE:

The block cheese price fell yet again today to continue to make new lows not seen in over six years. Barrels were steady with no bids or offers available. Futures, however, were higher on the day, trading as much as 2.6 cents higher on the November contract. Fundamentals do not give any reason so support an actual rally here but it is nice to see some small gains on the board. For the component prices listed in the Federal Order released today, cheese came in at $1.5577 per pound, 0.0626 cents lower than last month.

BUTTER:

Butter prices also fell in the Class and Component Prices released today for September. Butter came in at $1.4462, 2.85 cents lower than what was released in August. In the cash market, butter had a positive day, making up for much of the ground lost in yesterday's trade by gaining 4.25 cents back on the day with 28 trades loaded. With the volume of bids available, it is reasonable to assume that buyers are willing to make deals here at these prices. Futures did not follow suit today, trading slightly lower on the day.

OUTSIDE MARKETS SUMMARY:

December corn closed down 21.25 cents per bushel at $5.0075, November soybeans closed down 4.75 cents at $12.9300 and December soybean meal closed down $2.10 per ton at $356.90. December Chicago wheat closed down 17.00 cents at $6.7575.

December live cattle closed up $1.90 at $222.70. November crude oil is up 1.04 per barrel at $90.42. The Dow Jones Industrial Average is down 443 points at 50,906 and the NASDAQ is up 63 points at 26,861.

Wednesday Midday Dairy Market Update - Butter Buyers Come to the Table

OUTSIDE MARKETS SUMMARY:

CORN:	20 Lower
SOYBEANS:	5 Lower
SOYBEAN MEAL:	$0.25 Lower
LIVE CATTLE:	$2.03 Higher
DOW JONES:	66Points Lower
NASDAQ:	242 Points Higher
CRUDE OIL:	$1.64 Lower

MIDDAY MARKET UPDATE:

The block cheese price traded 0.50 cent lower today closing at $1.2700 with 3 loads traded. The barrel cheese price was unchanged at $1.4525 with no loads traded. The dry whey price climbed 0.50 cent, closing at 81.50 cents with 1 load traded. Class III futures are trading anywhere from 2 to 30 cents higher here at the midday point. The butter price was up at 4.25 cents with 28 loads traded. There were 18 unfilled offers and 92 bids remaining at the close. Grade A nonfat dry milk was 0.75 cents higher at $2.20 with 2 loads traded. Class IV futures are mixed from 5 cents lower to 25 cents higher. Butter futures are 0.025 to 1.25 cents lower. Dry whey futures are trading 0.25 cents to 1 cent lower. Cheese futures are 0.4 to 2.1 cents higher. Nonfat dry milk futures are 0.35 lower to 3.50 cents higher. 

Wednesday Morning Dairy Market Summary - Butter May Be Near Support

OPENING CALLS:

Class III Milk Futures:	Mixed
Class IV Milk Futures:	Mixed
Butter Futures:	Mixed

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	3 to 4 Higher
Soybean Futures:	7 to 8 Higher
Soybean Meal Futures:	$2 to $3 Higher
Wheat Futures:	6 to 7 Higher

MILK:

It hurts to look at the Class III futures prices. The October contract is now the lead month with a price of $14.93. It has been quite some time since the Class III price has fallen below $15.00. If the current futures prices remain through the end of the year, it will be very difficult financially to cash flow. On the other hand, Class IV prices continue to increase, supported by strong nonfat dry milk. The dry whey price has reached the highest level in four years, with nonfat dry milk moving near the highs of early May. The Quarterly Grain Stocks report will be released today and may have an impact on feed prices depending on the level of grain on hand. The Agricultural Prices report will be released this afternoon, providing most of the prices used to calculate income over feed for the Dairy Margin Coverage program.

CHEESE:

This is not much to be said about the block cheese market, as sellers continue to offer supplies to the spot market at lower prices. The price falling back to the lowest level in more than six years at the time of year when both demand and prices usually increase does not bode well for the market.

BUTTER:

The butter price is only 1.75 cents above the lows of the year. The price may be low enough to generate greater buying interest, as there were 41 unfilled bids remaining at the close of spot trading. This may indicate buyer support may be near. However, the upside price potential may be limited