MILK
Class III milk futures jumped following the increase of cheese. Gains were limited overnight and this morning through spot trading. However, as the day progressed, futures slowly strengthened resulting in December futures gaining 43 cents with January up 38 cents. Both November and December prices are back above $18.00 again. Class IV futures posted minor gains, despite no movement of butter or nonfat dry milk prices. USDA released the World Agricultural Supply and Demand Estimates (WASDE) report today. The estimate for 2021 milk production was reduced 600 million pounds, to 226.4 billion pounds. The estimate for next year was reduced 1.6 billion pounds and one of the largest month-to-month changes I have seen. Class III milk price for this year was reduced $0.10 cents to an average of $16.95. Class IV was raised $0.30 cents to an average of $16.00. The All-milk price was raised $0.05 cents to $18.50. For next year, USDA raised the average Class III price $0.65 cents to $17.75. Class IV was raised $1.55 to $18.70. The All-milk price for 2022 was raised $1.05 to $20.25
AVERAGE CLASS III PRICES
| 3 Month: | $18.23 |
| 6 Month: | $18.46 |
| 9 Month: | $18.58 |
| 12 Month: | $18.64 |
CHEESE
Block cheese price has increased substantially during the past two days making one wonder why it had declined as much as it had during the past two weeks. Buyers turned aggressive as they needed to fill orders only to find sellers holding back on what they offered. USDA reduced its estimate from October for cheese price this year by a penny to $1.67, but raised the 2022 estimate by 5 cents to $1.7650. Dry whey was raised 0.50 cent this year to an average of 57 cents and raised 2 cents next year to 53 cents.
BUTTER
USDA raised its estimate of butter price this year by 3.50 cents from the October report to an expected average of $1.72. The price estimate for next year was raised 15.50 cent to $1.91. Nonfat dry milk also showed a substantial increase next year of 10.50 cent to average $1.4850 while the estimate this year was raised 2.50 cents to $1.27. This is one of the largest increased I have seen for butter and especially nonfat dry milk.
OUTSIDE MARKETS SUMMARY
December corn closed 3.25 cents higher at $5.5475. November soybeans jumped 21.50 cents to close at $11.9950 with December soybean meal up $10.70 per ton, closing at $342.50. December wheat gained 10.50 cents, ending at $7.7850. December live cattle increased $0.10 to close at $132.30. December crude oil jumped $2.22, closing at $84.15. The Dow fell 112 points to end at 36,320 points while the NASDAQ was down 96 points to close at 15,887 points.
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