MILK
There is little interest in short-covering or buying milk futures. The weakness of cheese and the sideways movement of other spot category prices leaves little to get excited about. Milk supply is plentiful, meeting the needs for both bottling and manufacturing. Spring flush is behind us with milk receipts declining from the peak. Bottling demand has slowed now that schools are closed for the summer. Plants that normally would be in the market purchasing extra milk have slowed those purchases. Other plants indicated they are receiving limited offers of milk for purchasing. Even with that, spot milk continues to run at a discount to class. There is more concern over continued dryness developing dryness across the regions. USDA reported virtually all corn has been planted with 90% of the corn crop emerged as of the end of last week with weekly crop conditions at 72% good to excellent. This compares to last week at 76% good to excellent and 75% a year ago. Soybeans are 90% planted with crop conditions at 67% good to excellent. A year ago, the crop was at 72% good to excellent.
AVERAGE CLASS III PRICES
3 Month: | $17.60 |
6 Month: | $18.20 |
9 Month: | $18.16 |
12 Month: | $18.07 |
CHEESE
Block cheese continues to slide lower back to the level it was in May last year. That is concerning due to demand being higher and no disruptions such as there were last year. Milk production is higher, which leaves more available for manufacturing. As long as demand is being met and cheese production remains strong, there is little to provide any catalyst to push prices higher. There is no supply tightness, nor is there expected to be any for the foreseeable future.
BUTTER
Price has been struggling recently due to the foodservice pipeline being filled and now maintaining supply for the industry. Retail demand has slowed, leaving buyers less aggressive in the spot market. Some buyers have purchased butter ahead rather than waiting for a lower price or until they need to purchase. Buyers are comfortable paying for a longer storage duration to limit exposure during the higher-demand period later in the year.
OUTSIDE MARKETS SUMMARY
July corn gained 0.75 cent, ending at $6.80. July soybeans jumped 19.75 cents, closing at $15.80, with July soybean meal up $2.90 per ton, closing at $389.80. July wheat gained 5 cents, closing at $6.85. June live cattle gained $0.50, ending at $116.72. July crude oil increased $0.82, closing at $70.05 per barrel. The Dow slipped 30 points, closing at 34,600, while the NASDAQ gained 43 points, closing at 13,925.