MILK:
Class III milk futures have made a nice comeback over the past four trading days, erasing over one-third of the losses since May. Traders have decided the underlying price increase of cheese is real for the time being. This has increased the buying interest of traders and has increased the buying desire of traders in the spot market. USDA released the World Agricultural Supply and Demand report which contains a section on U.S. Milk Supply and Use. USDA estimates milk production this year to total 228.5 billion pounds, down 300 million pounds from the June report. They increased milk production next year to 231.6 billion pounds, up 500 million pounds from their previous estimate. Beginning commercial stocks on a fat basis were left unchanged at 15.6 billion pounds with an increase of 100 million pounds next year, totaling 15.2 billion pounds. Marketings were reduced 200 million pounds to 227.2 billion pounds this year with an increase of 500 million pounds totaling 230.5 billion pounds next year from their June estimate. Beginning commercial stocks on a skim solids basis remained unchanged at 10.9 billion pounds this year and increased stocks 500 million pounds to a total of 11.1 billion pounds next year. Marketings on a skim solids basis were identical to marketings on a fat basis at 227.2 billion pounds and 230.5 billion pounds. Class III price was reduced this year $0.65 from the June estimate to an average of $16.80. Price for next year was reduced $0.40 to an average of $16.75. Class IV price was reduced $0.45 to an average of $15.40. Price for next year was reduced $0.20 to an average of $15.75. The all-milk price was reduced $0.55 to an average of $18.30 and reduced $0.25 next year to $18.50.
AVERAGE CLASS III PRICES:
| 3 Month: | $17.59 |
| 6 Month: | $17.99 |
| 9 Month: | $17.91 |
| 12 Month: | $17.87 |
CHEESE:
Cheese prices continue to extend gains. Buyers have become more aggressive as price has been increasing. Now it may be a matter of chasing the market higher for the time being for those who have been purchasing on an as-needed basis. USDA reduced the estimate for cheese prices $0.05 to an average of $1.6550 this year. The average for next year is $1.68, down $0.0350 from June. Dry whey was reduced $0.02 cents to $0.57 while the average was left unchanged at $0.51.
BUTTER:
Butter price was reduced $0.0250 cents to an average of $1.69 for this year. Price was reduced $0.0450 cents to $1.75 for next year. Nonfat dry milk was reduced $0.04 cents to an average of $1.21 while price for next year was left unchanged at $1.22.
OUTSIDE MARKETS SUMMARY:
July corn jumped 39.50 cents, settling at $6.6925. July soybeans jumped 28.50 cents, closing at $14.3250 with July soybean meal up $2.40 at $354.50 per ton. July wheat jumped 26.50 cents, closing at $6.35. August live cattle gained $0.60, closing at $119.82. The DOW gained 126 points, closing at 34,996 while the NASDAQ gained 31 points, closing at 14,733..
