MILK:
Milk futures closed on a strong note Friday as the increase of cheese, butter and nonfat dry milk prices fueled the gains. Class III futures are trying to regain the losses since mid-January and are not far from accomplishing that task. Class IV futures are setting new contract highs in deferred contracts. Class IV prices continues to outpace Class III due to the higher prices of butter and nonfat dry milk. A substantial amount of milk was being absorbed by bottlers this week as consumer demand was high as they prepared for the winter storm. Now, retail stores are attempting to restock store shelves again. Milk supply is sufficient to meet the needs for all levels of fluid milk demand and dairy product production. Some farms are beginning to hold back some of their animals due to the potential for increasing milk prices. At the same time, cull cow prices have been attractive and increasing. Dairy cattle prices have been increasing at sale barns indicating a desire to restock or maintain cow numbers.
AVERAGE CLASS III PRICES:
| 3 Month: | $21.39 |
| 6 Month: | $21.44 |
| 9 Month: | $21.35 |
| 12 Month: | $21.04 |
CHEESE:
The December Dairy Products report showed American type cheese production at 469 million pounds, a decline of 1.2% below December. Italian type cheese production totaled 485 million pounds, down 1.2% below a year ago. Total cheese output reached 1.16 billion pounds which was 0.1% above December 2020. Dry whey production totaled 77.2 million pounds, down 5.0%. Lactose production for both human and animal consumption totaled 97.2 million pounds, up 2.3%. Whey protein concentrate production declined 0.4% totaling 42.9 million pounds. For the week, blocks increased 11 cents with only one load traded. Barrels increased 15.25 cents with seven loads traded. Dry whey increased 1.75 cents with two loads traded.
BUTTER:
Butter production was down 13.2 million pounds totaling 180 million pounds. Interestingly, production was 15.4% above November. Nonfat dry milk production fell 20.1% from December 2020 totaling 166 million pounds. Skim milk powder output totaled 38.0 million pounds, down 24.9% from a year ago. For the week, butter declined 4 cents with 18 loads traded. Grade A nonfat dry milk gained 2.75 cents with 28 loads traded.
OUTSIDE MARKETS SUMMARY:
March corn gained 3.75 cents, closing at $6.2050. March soybeans gained 9.25 cents, closing at $15.5350 with March soybean meal up $6.80 per ton, closing at $443.90. March wheat gained 11.50 cents, closing at $7.6325. February live cattle gained $0.45, closing at $142.05. March crude oil gained $2.04, closing at $92.31 per barrel. The DOW closed 21 points lower at 35,090 while the NASDAQ jumped 219 points closing at 14,098.
