Thursday Closing Dairy Market Update - Milk Futures Closed Mixed

GENERAL OVERVIEW:

Steady milk production keeps a sufficient supply for manufacturing, leaving little reason for spot prices to increase. Cheese buyers had no interest in supporting spot prices today. Butter was better but did not generate substantial support in futures.

MILK:

Milk output in the Western region remains stable. There have not been large swings in milk production, leaving a sufficient supply on the spot market. This sufficient supply will keep the upside price potential limited. It was hoped that demand would improve and prices would find support. That may yet take place, but certainly not in the near term. The drop in cheese prices today indicates the markets may remain entrenched in a sideways pattern. The May contracts are mostly priced and will move sideways with limited movement after this week. June Class III futures have been decreasing to eliminate the premium they had contained in anticipation of higher prices. June Class IV futures have been holding as the underlying cash is supporting the market.

AVERAGE CLASS III PRICES:

3 Month:	$17.27
6 Month:	$17.93
9 Month:	$18.06
12 Month:	$17.98

CHEESE:

The substantial decline in the block cheese price was unexpected, as the market had been trading in a tight sideways range. The price has moved down near the bottom of the wider trading range that has been in place since mid-March. Class III futures held well despite the decline as traders continue to do day or short-term trading, reducing the need for substantial liquidation. Demand for spot milk from cheese manufacturers varies depending on location and cheese varieties.

BUTTER:

Buyers were aggressive in the spot butter market, but there is little reason for buyers to remain aggressive for an extended period. At least, the price has not moved down to retest the lows. All the uncovered offers from Wednesday were purchased, and more, with only one offer remaining at the close today. However, this does not mean the market will move higher on Friday. It will depend on who needs to take care of business and how aggressive they will be.

OUTSIDE MARKETS SUMMARY:

July corn closed down 13.25 cents per bushel at $4.6750, July soybeans closed down 36.50 cents at $11.9250, and July soybean meal closed down $6.00 per ton at $332.50. July Chicago wheat closed down 17.50 cents at $6.5800. June live cattle closed down $0.73 at $252.08. June crude oil is up $0.99 per barrel at $102.01. The Dow Jones Industrial Average is up 370 points at 50,063, with the NASDAQ up 233 points at 26,635.

Fluid Milk and Cream - Western U.S. Report 20

California milk production is stable. Handlers indicate large week-to-week changes have not taken place yet this spring. Balancing plants are handling manageable volumes. Stakeholders indicate milk loads are available for spot buyers. 

Arizona and New Mexico farm level milk output varies from steady to somewhat lighter. Some stakeholders are looking to secure spot loads of milk as volumes are tighter than anticipated. 

Pacific Northwest milk production is mixed. Washington processors note milk volumes are tight in the state. The latest milk production report from National Agricultural Statistics Service (NASS) shows the milk cow total for Washington as 236,000 in March 2026 compared to 251,000 in March 2025. This report also shows Washington had the most severe drop by percentage in milk production. 

Milk production is steady in the Mountain States of Idaho, Utah, and Colorado. Milk output is meeting or exceeding expectations. Handlers report milk components continue to be strong. Although some Idaho stakeholders note caps are keeping milk volumes balanced with processing capacities, spot milk loads are available. 

Stakeholders report more than enough cream is available in the West and demand for it has picked up. Prices are lower than week 19, which decreased cream multiples for this week. Condensed skim milk availability and demand are steady.

Thursday Midday Dairy Market Summary - Cheese Prices Fall

OUTSIDE MARKETS SUMMARY:

CORN:	13 Lower
SOYBEANS:	40 Lower
SOYBEAN MEAL:	$7.20 Lower
LIVE CATTLE:	$0.60 Lower
DOW JONES:	360 Points Higher
NASDAQ:	232 Points Higher
CRUDE OIL:	$0.66 Higher

MIDDAY MARKET UPDATE:

The block cheese price fell 7.00 cents to close at $1.5700 with 7 loads traded. This moved the price down to the low of the larger trading range that has developed since March. The recent tight trading range was violated, potentially opening the way for further weakness. The barrel cheese price declined 3.00 cents, closing at $1.5700, which is the lowest it has been since March 30. No loads were traded. The dry whey price remained unchanged at 67.50 cents with no loads traded. Class III futures are holding well, with contracts 14 cents lower to 17 cents higher. The butter price increased 2.75 cents, closing at $1.6450 with 36 loads traded. The large number of offers that remained at the close on Wednesday were absorbed. There were 15 unfilled bids with 1 uncovered offer remaining at the close of spot trading. Grade A nonfat dry milk declined 1.25 cents to close at $2.2750 with 8 loads traded. Class IV futures are 2 cents lower to 23 cents higher with traders focusing on the strength of butter. Butter futures are steady to 2.72 cents higher. Dry whey futures are steady to 1.30 cents higher. Cheese futures are steady to 1.60 cents lower.