MILK
Milk futures finished the holiday-shortened week with a bang. The large gains of milk futures Wednesday were held with further gains realized Thursday. The gains Thursday were in relationship with the gains of underlying cash. The gains of Thursday were the result of the idea that milk production will slow due to the potential for much higher feed prices. The correlation is made that higher feed prices will result in heavier culling as well some ration changes, which could reduce milk production to some extent. This was a greater factor a year ago, but it may not have as much of an impact now. Higher milk prices make it possible to purchase feed at higher prices, keeping production rolling along as it has been. Futures will need to remain supported by increasing underlying cash, or they may correct to the downside. The overall price outlook for this year has improved quite a bit. Markets will be closed Friday and will reopen Sunday night.
AVERAGE CLASS III PRICES
| 3 Month: | $18.19 |
| 6 Month: | $18.43 |
| 9 Month: | $18.39 |
| 12 Month: | $18.19 |
CHEESE
Retail cheese demand has been steady with steady increases seen from the food service industry. Warmer weather will result in more restaurants offering outside dining to hopefully increase business. It certainly is good to see retail demand holding rather than being offset by increasing demand from the food service industry. For the week, blocks increased 5.50 cents with 11 loads traded. Barrels increased 5 cents with four loads traded. Dry whey increased 3.25 cents with four loads traded.
BUTTER
For the week, Butter gained 7 cents with 19 loads traded. Grade A nonfat dry milk increased 3.25 cents with four loads traded. The price dip was short-lived with the market pushing higher again. There is strong demand from the food service industry, retail and the export market. This keeps buyers aggressively purchasing supply just in case milk supply diminishes during the year and supply tightens. That is not anticipated to happen, but buyers want to hedge against that by purchasing supply now rather than later.
OUTSIDE MARKETS SUMMARY
May corn declined 4.50 cents, ending at $5.5975. May soybeans fell 34.75 cents, closing at $14.02, with May soybean meal down $13 per ton, closing at $410.20. May wheat declined 7 cents, closing at $6.11. April live cattle declined $0.95, closing at $120.02. May crude oil jumped $2.29 per barrel, closing at $61.45. The Dow gained 172 points, closing at 33,153, while the NASDAQ jumped 233 points, ending at 13,480.
