MILK
Milk production continues to slowly improve seasonally, resulting in full plants with milk moving around greater distances to find manufacturing capacity. This may be a greater issue as we move through the holidays. However, manufacturing and bottling have been able to keep up with supply. Class III futures did not hold the optimism that seems to have been prevalent recently. Even though there was only a minor decline of block cheese price, futures corrected significantly as they need to come back more closely in line with underlying cash. Milk futures may chop around through the end of the year and into next year. There is concern that milk supply might become more burdensome through the early part of next year if milk production and cow numbers continue to grow. Current milk futures, with a reasonable basis, would keep many farmers in a reasonable profit situation, allowing them to keep cranking out the milk. Milk prices here will keep the current trend of growing milk production intact. USDA will release the November Milk Production report on Thursday, which is expected to show continued strong growth.
AVERAGE CLASS III PRICES
| 3 Month: | $16.40 |
| 6 Month: | $16.75 |
| 9 Month: | $16.92 |
| 12 Month: | $17.04 |
CHEESE
Demand for cheese in the Midwest is steady despite holiday orders slowing. Large demand continues to come from pizza makers and restaurants that specialize in pizza. Many consumers that once went out for pizza now purchase takeout or take-and-bake pizzas to enjoy at home. Cheese production is steady with some increase noted as very attractive spot milk prices are available. Prices are expected to remain in a range for a period.
BUTTER
Output is strong as manufacturers utilize heavy cream supplies at attractive prices. Most of the butter for the holidays has been shipped and stocked. Retail outlets may hold back on ordering now until they see how strong demand will be through the holidays and how current stocks decline. Similar to cheese, price is expected to remain choppy through the end of the year.
OUTSIDE MARKETS SUMMARY
March corn gained 2.50 cents, closing at $4.2725. January soybeans slipped 0.50 cent, ending at $11.8375, with January soybean meal jumping $6.30 per ton, closing at $394.50. March wheat declined 1.25 cents, ending at $5.9850. December live cattle gained $0.17, closing at $108.77. January crude oil increased $0.20, closing at $47.82 per barrel. The Dow declined 45 points, closing at 30,155, while the NASDAQ gained 63 points, closing at 12,658.
.jpg)
