MILK:
Milk futures contracts through the rest of this year settled lower due to further weakness of cheese prices. Traders have turned more cautious as supply is readily available and buyers have no need to be aggressive. July Class III futures are just barely hanging on to $18.00, reflecting some of the optimism that remains in the market. However, April has been hit very hard, falling $1.27 in less than two weeks. April has about one week of pricing by the trade under its belt and the prospect for a much higher price than March does not look very promising. Milk production will continue to improve as the market heads to spring flush. Increasing cow numbers and production per cow will push milk production and plant capacity.
AVERAGE CLASS III PRICES:
| 3 Month: | $16.87 |
| 6 Month: | $17.42 |
| 9 Month: | $17.72 |
| 12 Month: | $17.71 |
CHEESE:
The February Cold Storage report showed an increase in all categories from the January report. American cheese inventory totaled 816.0 million pounds, up 6.9 million pounds from January and 5% above a year earlier and the highest level since May 2020. Swiss cheese inventory increased 1.4 million pounds to 22.7 million pounds. This was 6% above January, but 6% below February 2020. Other cheese inventory totaled 597.5 million pounds, up 19.6 million pounds from January or 3%. However, it was 7% above a year earlier. Total cheese inventory increased 2% to 1.436 billion pounds. This was 5% above February 2020. Total cheese inventory is at the highest level since May 2020.
BUTTER:
Butter inventory totaled 352.7 million pounds. This was 6% higher than January and 17% above February 2020. There was growth of inventory, but the increase was lighter than usual for February. That was likely due to stronger exports that have been seen since late last year. This is the lowest butter inventory since August 2020.
OUTSIDE MARKETS SUMMARY:
May corn fell 8.75 cents, closing at $5.49. May soybeans gained 1.25 cents, ending at $14.1750 with May soybean meal down $11.30, closing at $396.60 per ton. May wheat gained 0.25 cent, ending at $6.2725. April live cattle increased $0.37, ending at $118.75. June crude oil gained $0.13, closing at $61.55 per barrel. The DOW gained 103 points, closing at 32,731 while the NASDAQ gained 162 points, ending at 13,387.
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