MILK
Milk production is reported to be increasing in the Midwest as cooler weather sets in and new feed quality is good. Many areas report adequate to abundant forages, which will keep production costs down and keep barns full. Spot milk prices backed off a little with prices ranging from slightly under class upward to 75 cents over class. Spot milk is a little less available than it had been, which has slowed down production at some plants as they do not feel the need to supplement current supplies with purchased milk. Dairy cattle slaughter increased significantly in August, according to the Livestock Slaughter report. August slaughter totaled 261,400 head. This was an increase of 13,500 head from July and an increase of 36,100 head from August 2021. This was the highest level of slaughter since March. Continued low milk prices and high feed prices are having an impact on the rate of culling.
AVERAGE CLASS III PRICES
| 3 Month: | $16.92 |
| 6 Month: | $17.11 |
| 9 Month: | $17.27 |
| 12 Month: | $17.40 |
CHEESE
It appears there may be limited upside potential for cheese prices under the current market situation. Demand is improving with some varieties of cheese being rather tight. However, overall supply is sufficient with production remaining strong. Price increases for blocks and barrels on the spot market continue to be taken advantage of by sellers as they continue to move production rather than store it. Increasing American cheese inventory on the cold storage report was not supportive for an uptrend or for prices breaking out of the trading range.
BUTTER
It appears price might be moving to a sideways trading pattern with the bounce Thursday. Butter production is improving as more cream is becoming available to the market. That should not overwhelm the market as demand is improving. Butter stocks at the end of August have declined below year-ago levels, which should be bullish to the market.
OUTSIDE MARKETS SUMMARY
December corn closed 3.75 cents higher at $5.2925. November soybean gained 1.50 cents, ending at $12.8425, with October soybean meal down $1.30 at $336.60 per ton. December wheat gained 12 cents, closing at $7.1775. October live cattle slipped $0.05, ending at $123.22. October crude oil gained $1.07, closing at $73.30 per barrel. The Dow gained 507 points, closing at 34,765, while the NASDAQ gained 155 points, closing at 15,052.
