MILK:
August and June contracts of this year and May and July contracts of next year all suffered double-digit losses. Traders were not convinced the increase of barrel cheese and butter prices were going to be sustained. Buyers may not be in the mood to aggressively purchase supply due to current availability and the false breakout of prices that came crashing down last week. Milk production and supplies will need to tighten before buyers become more excited again. Fluid milk sales continue to decline. After the frenzy of consumers purchasing fluid milk early in the pandemic last year, demand has been in a downtrend. Conventional fluid milk sales in May were down 3.9% from the previous year. Whole milk sales declined 9.7%; flavored whole milk sales jumped 17.2%; reduced fat milk declined 6.7%; low fat milk declined 4.7%; fat-free skim fell 15.3%; flavored reduced fat milk jumped 47.9%; buttermilk sales gained 14.8% with other fluid milk product sales of 34.6%. Organic milk sales fell 10.6% in May. Organic whole milk sales declined 8.0%; organic reduced fat fell 16.3%; organic low-fat milk fell 15.4%; organic fat-free skim milk declined 4.1%; organic flavored fat reduced jumped 26.7% with other organic fluid milk products sales down 49.2%. This put total fluid milk sales down 4.3% from the previous year with sales down 4.8% year-to-date.
AVERAGE CLASS III PRICES:
| 3 Month: | $16.87 |
| 6 Month: | $17.40 |
| 9 Month: | $17.46 |
| 12 Month: | $17.50 |
CHEESE:
Even though barrel cheese price was able to bounce a bit Monday, that does little to provide price support to the market. Price remains down at the lowest level it has been since late March. Milk supply continues to remain heavy with sufficient supply to go around for all areas of manufacturing. As long as cheese production remains strong with many plants continuing to run near capacity, price increases will remain limited.
BUTTER:
Butter futures continue to hold a premium to the current spot price. However, that premium has declined from what it was not too long ago. The inability of price to increase and continue to trend lower, has reduced the expectation of traders. The highest price expected this year is $1.79 in December and a far cry from the $2.00 that had been expected earlier this year.
OUTSIDE MARKETS SUMMARY:
September corn closed unchanged at $5.56. August soybeans fell 26.75 cents, ending at $14.28 with August soybean meal down $3.40 per ton, closing at $359.80 per ton. September wheat gained 5.25 cents, closing at $6.9775. August live cattle gained $0.07, ending at $120.25. August crude oil plummeted $5.39, closing at $66.42 per barrel. The DOW plummeted 726 points, ending at 33,962 while the NASDAQ fell 152 points, closing at 14,275.
