MILK
Class III milk futures made a valiant attempt to push higher during and shortly after spot cheese traded, but could not hold the double-digit gains. But at least contracts were steady to higher for the day. There is not a lot of news out there now to have any significant impact on the market. The weather event is history with farms getting things back up and running again. Cows will come back up again on milk production as milder weather dominates the country. Milk futures are expected to chop around for a period of time as the market assesses supply and demand moving through the first quarter of the year. USDA will release the January Milk Production report on Tuesday, and it is expected to show a significant gain over a year ago. Large cow numbers and strong milk production per cow during the mild weather experienced during the month should show a strong increase in milk output.
AVERAGE CLASS III PRICES
| 3 Month: | $16.26 |
| 6 Month: | $16.88 |
| 9 Month: | $17.17 |
| 12 Month: | $17.20 |
CHEESE
Cheese is just kind of bumping along. Price increases are welcomed, but when looking at the larger picture on price charts, they have not performed very well. It is possible some level of support may be found near the current level, but that may not necessarily mean that prices will begin to trend higher. The market will need to see greater demand that will offset strong cheese production to cause the market to trend higher. Lower prices should increase demand, but demand needs to exceed production to tighten supply. This may be difficult to achieve anytime soon.
BUTTER
Price strength may have run its course for the time being. Buyers' needs may have been satisfied for now with sellers may be stepping back up to the plate again now that price has weakened. Production continues to remain strong due to plentiful cream supplies. Churns are utilizing the available cream rather than limiting production and selling extra cream. This is very difficult as very few plants are in the market for any extra cream due to plentiful supplies of their own.
OUTSIDE MARKETS SUMMARY
March corn gained 8.25 cents, closing at $5.51. March soybeans gained 6.50 cents, ending at $13.8375, with March soybean down $1.20 per ton, closing at $423.10. March wheat jumped 13.25 cents, ending at $6.64. February live cattle slipped $0.20, closing at $115.72. March crude oil jumped $2.25, closing at $61.49. The Dow gained 27 points, ending at 31,522, while the NASDAQ fell 341 points, closing at 13,533.
