MILK
It seems as if there is no bottom in the milk market. December Class III futures are down to the lowest level since Sept. 17 when the market began the recent uptrend. Price took about six weeks to increase to the high on Oct. 29. The price has declined a similar amount in 2 1/2 weeks. This is another example of the market falling faster than it increases. Milk futures are falling in order to keep in line with underlying cash as well as anticipating how far prices could fall. Demand has not dried up, but the main holiday push is about finished with buyers scaling back purchases of cheese. Bottled milk supply to school accounts is variable. Some states are closing schools again or initiating stricter protocol, which is reducing dairy demand through the school sector. Retail demand has been good but will need to improve through the end of the year or the market could be in a world of hurt. The monthly milk production report that will be released on Wednesday is anticipated to show increased milk production.
AVERAGE CLASS III PRICES
| 3 Month: | $28.84 |
| 6 Month: | $17.65 |
| 9 Month: | $17.29 |
| 12 Month: | $17.18 |
CHEESE
The bright spot was that blocks were able to hold, but the concern is that there were no unfilled bids in the market Monday. Two loads offered at the steady price without lowering those offers was not enough to bring buyers into the market, leaving that tactic ineffective. Buyers do not want to purchase now and will wait for lower prices. Sellers want to move cheese rather than hold for higher prices, which may not unfold anytime soon. The fundamental attitude of the market has switched and is not likely to bottom and come roaring back as it did twice so far this year. That is, not unless there is a major outside factor that may provide substantial support.
BUTTER
Without price showing any lasting strength through this time of year, it is doubtful any will be seen through the end of the year. Early next year will remain subdued due to the potential for no change in demand from the food service industry. Butter will be produced and stored in order to take some of the milk and cream off the market.
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