MILK
Class III milk futures closed the week lower with August down about 25 cents and September down about 60 cents. More premium has been taken out of later contracts as traders turned more bearish for the longer term. It is interesting to see the decline of futures as block cheese price actually increased this week with barrels down minimally. The pressure came from dry whey declining. USDA released the June Agricultural prices report on Friday, which showed an income-over-feed price of $6.25. Those who chose the $9.50 level for the Dairy Margin Coverage program will receive a payment of $3.25 per cwt for the month. The average corn price for the month was $6, an increase of $0.09 above the May price. The soybean meal price from the Central Illinois Processors report averaged $378.18 per ton, down $42.85 per ton from May. The alfalfa price was $199.00 per ton, up $5 per ton from May. The premium/supreme alfalfa price was $230 per ton, up $4 per ton higher than May. This resulted is a blended alfalfa price of $214.50 per ton, which is used for the income-over-feed calculation. The all-milk price was $18.40, down $0.80 from May. This compares to prices a year ago for corn at $3.16; soybean meal at $288.63; alfalfa price of $179 and an all-milk price of $18.20 per cwt.
AVERAGE CLASS III PRICES
| 3 Month: | $16.38 |
| 6 Month: | $16.86 |
| 9 Month: | $16.98 |
| 12 Month: | $17.06 |
CHEESE
Cheese prices did fairly well for the week, but you would not have thought that looking at the movement of Class III futures during the week. Block cheese price increased 5 cents with three loads traded. Barrel cheese declined, but the decline was minimal. Barrels declined 1.25 cents with 16 loads traded. However, since the significant price increase a few weeks ago and the sharp decline, traders have become extremely bearish. This attitude will be difficult to turn anytime soon. Dry whey was responsible for much of the pressure of this week with price down 3.50 cents with four loads traded.
BUTTER
For the week, butter declined 5.25 cents with six loads traded. Grads A nonfat dry milk increased 1.50 cents with six loads traded. Price moved to the lowest level since Feb. 26 with the decline this week. Buyers were unaggressive waiting for lower prices to pick up supply. They feel no threat of tightening supply or higher prices.
OUTSIDE MARKETS SUMMARY
September corn fell 11 cents, settling at $5.47. August soybeans fell 19.50 cents, ending at $14.1475, with August soybean meal down $3.90 per ton, closing at $352.60. September wheat slipped 1.50 cents, ending at $7.0375. August live cattle declined $0.45, closing at $122.07. September crude oil gained $0.33, ending at $73.95 per barrel. The Dow declined 149 points, closing at 34,935, while the NASDAQ closed 106 points lower, closing at 14,673.
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