MILK
Milk futures were up, up and away Thursday. Actually, it began with overnight trade as traders reacted to the bullishness of the January Milk Production report. This carried over throughout Thursday with some milk contracts closing limit up. Buyers were more aggressive in the underlying cash Thursday. However, it is uncertain whether that was due to the report or if buyers needed to purchase in order to fill orders. It did follow the same pattern as it did when the World Agricultural Supply and Demand report was released earlier this month. Further strength in futures is expected Thursday evening. The reports in the country indicate milk production is trending higher, which seems a bit odd due to the production reports indicating production per cow is down 15 pounds from a year ago. However, it may be increasing from lower levels. It is reported that milk is sufficient for bottling and manufacturing with some areas sourcing supply from other areas to fill the void. Annual milk production in 2021 increased 1.3% from the previous year. Milk production per cow averaged 23,948 pounds, up 171 pounds from 2020. Cow numbers averaged 9.45 million head, up 0.6% from 2020.
AVERAGE CLASS III PRICES
| 3 Month: | $22.23 |
| 6 Month: | $22.44 |
| 9 Month: | $22.31 |
| 12 Month: | $21.94 |
CHEESE
Some manufacturing plants have reduced operations as they are taking care of some needed maintenance. This has slowed output to some degree while at the same time keeping up with demand. Most report that inventory is balanced with demand for the time being. Buyers have been purchasing supply for the second quarter and may be looking out ahead to the third quarter in order to prepare for potentially tighter supply.
BUTTER
Price was expected to increase further due to the milk production report and the fact that buyers can purchase ahead and freeze butter for filling orders later in the year. However, buyers were not very aggressive. Cream supply remains plentiful with some weakness in demand showing up over the past week.
Outside Markets Summary
March corn gained 11.25 cents, closing at $6.95. March soybeans fell 13.50 cents, closing at $16.6150, with March soybean meal down $6.20 per ton, closing at $464.90. March wheat closed 50 cents higher at $9.26. February live cattle fell $2.52, ending at $140.52. March crude oil closed $0.71 higher at $92.81 per barrel. The Dow gained 92 points, closing at 33,224, while the NASDAQ jumped 436 points, closing at 13,474.
