MILK
Milk output is growing compared to the lows of the summer, but it may not be growing as much as it could have if milk prices would be higher, feed would be less expensive and other expenses would be reasonable. However, the increase of milk production is fulfilling the needs of both manufacturers and bottlers. Heavier amounts of milk are moving to cheese manufacturing as demand for cheese is high currently. Some disruptions persist in the supply chain, which is delaying the delivery of product in a timely manner. USDA released the October Federal Order class prices Wednesday. They showed an increase in all categories. Class II price was announced at $17.08, up $0.19 from September and up $3.45 from the previous year. Class III was $17.83, up $1.30 from September, but down $3.78 from a year earlier. Class IV was $17.04, up $0.68 from the previous month and up $3.57 from October 2020.
AVERAGE CLASS III PRICES
| 3 Month: | $18.05 |
| 6 Month: | $18.20 |
| 9 Month: | $18.26 |
| 12 Month: | $18.31 |
CHEESE
Barrel cheese price fell below blocks over the past two days with a vengeance after remaining higher than blocks for several weeks. Barrel cheese supplies had been tighter for a while, but that seems to have changed. In fact, it is a strong possibility that the large push of holiday buying might finish earlier this year, and we may have seen the peak. The reason could be that buyers were purchasing earlier than usual due to the potential for later-placed orders to be delayed due to the lack of truck drivers. This could result in the inability to meet demand when consumers want to purchase for the holidays. Now the push may have subsided with sellers having a difficult time finding buyers even at lower prices.
BUTTER
Butter slipped back, but the overall market remains strong. The decline may be short-lived as buyers may step back up at lower prices to purchase needed supply to fill orders. Retail sales are good and expected to improve as the month progresses. It will be interesting to see if retail butter featuring may be less this year due to higher prices and some difficulties of getting supplies when desired due to delivery delays.
OUTSIDE MARKETS SUMMARY
December corn fell 9 cents, closing at $5.64, November soybeans fell 12.50 cents, ending at $12.3150, with December soybean meal up $3.60 per ton, closing at $340.80. December wheat fell 10.50 cents, closing at $7.81. December live cattle gained $1.70, closing at $131.65. December crude oil fell $3.05, closing at $80.86 per barrel. The Dow gained 105 points, closing at 36,158, while the NASDAQ increased 162 points, closing at 15,812.
