Monday Morning Dairy Market Update - Short-Covering Supports Milk Futures

OPENING CALLS:

Class III Milk Futures:	5 to 10 Higher
Class IV Milk Futures:	Mixed
Butter Futures:	1-3 Higher

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	6 to 8 Higher
Soybean Futures:	15 to 18 Higher
Soybean Meal Futures:	$1 to $2 Higher
Wheat Futures:	5 to 6 Higher

MILK:

It is not surprising to see overnight Class III milk futures show some strength. Short-covering took place as futures declined on Thursday and Friday, even though the block cheese price increased. The price of crude oil moving above $100 per barrel has not impacted milk futures negatively so far. This could have a greater impact if the conflict with Iran continues for an extended period of time. The weather in much of the country has been conducive to cow comfort and may result in the beginning of the spring flush. Milk output is not slowing down and is projected to remain higher than a year ago.

CHEESE:

The block cheese price is at the highest level since Nov. 11, 2025, and has increased for the past four consecutive days. The price may be near a level at which buyers may step back again. The supply of cheese is readily available.

BUTTER:

The price is expected to be choppy, but may hold above $2.00. Increasing butter production is building inventory, but at a slower pace than last year. Ice cream production is increasing and will utilize greater quantities of cream, reducing the amount available for butter production.

Friday Closing Dairy Market Update - Cash Butter 23 cents Higher on the Week

GENERAL OVERVIEW:

Friday was a disappointing day for butter in both the cash market and the futures market, however the week overall made big strides towards higher prices. Cheese also had a positive week, gaining 3-4 cents from last week's average.

MILK:

Class III Milk futures had a volatile week, peaking on Wednesday with a close of $17.64 but returning to Monday levels today, closing within 4 cents of Monday's close at $16.32. Class IV remained relatively flat all week with no new news to drive the market higher or lower. On Thursday, the USDA released the Dairy Products report, which showed higher output for nearly every dairy product outside of frozen yogurt, regular ice cream (hard) and Nonfat Dry Milk for human consumption. The demand for dairy products is there in value-added products such as cheese and butter, and the market has slowly started to pay attention. Milk production is an uphill battle as we enter spring with more availability on an already saturated market, but processed products and exports will help support already low prices.

AVERAGE CLASS III PRICES:

3 Month:	$16.88
6 Month:	$17.47
9 Month:	$17.79
12 Month:	$17.70

CHEESE:

For the week, blocks increased 3.10 cents with 10 loads traded. The weekly average price is $1.5770. Barrels increased 3.00 cents with one load traded. The weekly average price is $1.5620. Dry Whey decreased 0.80 cents with one load traded. The weekly average price is 63.20 cents.

BUTTER:

For the week, butter increased 23.05 cents with 92 loads traded. The weekly average price is $2.0625. Grade A nonfat dry milk decreased 1.35 cents with 59 loads traded. The weekly average price is $1.6640.

OUTSIDE MARKETS SUMMARY:

May corn closed up 7.00 cents per bushel at $4.6050, May soybeans closed up 21.50 cents at $12.0075 and May soybean meal closed up $7.90 per ton at $317.20. May Chicago wheat closed up 33.00 cents at $6.1675. April live cattle closed down $3.95 at $234.58. April crude oil is up 9.67 per barrel at $90.68. The Dow Jones Industrial Average is down 453 points at 47,501 and the NASDAQ is down 361 points at 22,387.

Friday Midday Dairy Market Summary - Milk Futures Move Opposite Spot Prices

OUTSIDE MARKETS SUMMARY:

CORN:	5 Higher
SOYBEANS:	18 Higher
SOYBEAN MEAL:	$7.60 Higher
LIVE CATTLE:	$3.42 Lower
DOW JONES:	434 Points Lower
NASDAQ:	175 Points Lower
CRUDE OIL:	$8.85 Higher

MIDDAY MARKET UPDATE:

The block cheese price increased 0.75 cent, closing at $1.6175 with one load traded. The barrel price remained unchanged at $1.57 with one load traded. The dry whey price increased 0.50 cent, closing at 64.00 cents with no loads traded. Class III futures are 44 cents lower to 11 cents higher, with the only gain in the December contract. The butter price decreased 3.00 cents, closing at $2.01 with 47 loads traded. There were 17 unfilled bids and one uncovered offer remaining at the close of spot trading. The spot price initially dropped 8.00 cents before buying interest lifted it off the low. Grade A nonfat dry milk increased 2.75 cents to close at $1.68 with 13 loads traded. Class IV futures are 10-48 cents lower. Butter futures are 4.25-7.50 cents lower. This makes no sense as the increase in nonfat dry milk offset the loss of butter in milk pricing. Dry whey futures are 0.75 cent lower to 0.52 cent higher. Cheese futures are 0.60-3.10 cents lower.