MILK
Class III milk futures were steady to lower across the complex Tuesday, even though underlying cash exhibits support under the market. The fact that it is not rising steadily is testing the resolve of traders that believe higher prices will continue to unfold. The market has made a nice rebound from the lows earlier this year, improving the price outlook for the year. The improved price outlook will keep stalls full and milk production strong. Improvements continue to be made on farms through upgraded facilities and expansion in some cases. There seems to be no difficulty putting in foundations and concrete -- the bigger issue is getting building materials in order to finish the rest of the building or the contractors to accomplish the task. It will be interesting to see just how much milk production will increase over the next three months as weather turns milder in many areas and spring flush moves into full swing. The Global Dairy Trade auction trade weighted average declined 3.8%. It was the first decline after eight consecutive gains. Anhydrous milk fat increased 3.7% to $6,155 per metric ton or $2.79 per pound. Butter declined 2.8% to $5,659 per metric ton or $2.57 per pound. This was the first decline in the butter index price since Sept. 15, 2020. Cheddar cheese percent was not reported with only one load traded and price remaining at $4,250 per metric ton or $1.93 per pound. Lactose jumped 8.6% to $1,392 per metric ton or $0.63 per pound. Skim milk powder gained 0.7% closing at $3,350 per metric ton or $1.52 per pound. Whole milk powder fell 6.2% to $4,083 or $1.85 per pound. Buttermilk powder was not offered at this event.
AVERAGE CLASS III PRICES
| 3 Month: | $17.27 |
| 6 Month: | $17.75 |
| 9 Month: | $17.96 |
| 12 Month: | $17.89 |
CHEESE
The fact that only one load of cheese traded on the Global Dairy Trade auction is somewhat of a mystery. I have never seen it before that there was no average trade percentage due to only one load traded. Interestingly, the load was traded for delivery out into September. I do not know if that has any meaning other than it was a slow day. Domestic cheese demand remains strong and should support price in this vicinity.
BUTTER
Price has just not yet been able to break through the previous high of $1.7150. It has matched that level twice but has not had sufficient buying interest to push it above. It does not appear that price will weaken much anytime soon as a lower price during spot trading was quickly erased limiting the loss.
OUTSIDE MARKETS SUMMARY
May corn gained 4.75 cents, closing at $5.5425. May soybeans gained 3.75 cents, closing at $14.2325, with May soybean meal down $1.30 per ton, closing at $406.10. May wheat gained 2 cents, closing at $6.47. April live cattle declined $0.92, ending at $118.20. April crude oil declined $0.59, closing at $64.80 per barrel. The Dow lost 128 points, closing at 32,826, while the NASDAQ gained 12 points, closing at 13,472.
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