MILK
Class III futures seem to be settling into a large sideways trading range. This may continue for a period as we move through spring flush. The market needs to balance supply with demand and not become overpriced or demand could taper off. There is little anticipation milk futures will fall very much but are expected to continue to see significant price fluctuations. No Class III futures contracts remained above $24 at the close Monday. Milk production is slowly improving as spring flush unfolds. Milk volumes continue to run lower than a year ago but are increasing from the lows of the winter. Manufacturers welcome increasing milk receipts as they want to satisfy customer orders as well as build inventory for upcoming demand. Spot milk discounts are not expected to be as large as usual during spring flush.
AVERAGE CLASS III PRICES
| 3 Month: | $23.79 |
| 6 Month: | $23.74 |
| 9 Month: | $23.51 |
| 12 Month: | $23.04 |
CHEESE
Block price slipped below barrels again Monday, which may not mean a whole lot due to significant variations of this spread over recent years. The fact that neither block nor barrel prices were able to hold initial gains during spot trading raises the caution of traders as they look ahead to tomorrow's market. Cheese futures continue to carry very limited premium to current cash through the rest of the year.
BUTTER
Active churning schedules with sufficient cream supply is keeping plants providing sufficient supply for demand as well as build inventory. Inventory has been building from month to month but is not gaining much year over year. Much of this year might be just keeping up with the inventory level of a year ago. For now, the market will remain sideways.
OUTSIDE MARKETS SUMMARY
May corn gained 15.50 cents, ending at $7.5050. May soybeans gained 19.50 cents, ending at $16.0225, with May soybean meal up $5.10 per ton, closing at $455.10. May wheat jumped 25.75 cents, closing at $10.1025. April live cattle declined $0.65, closing at $138.00. May crude oil jumped $4.01, closing at $103.28 per barrel. The Dow closed up 104 points, ending at 34,922, while the NASDAQ gained 271 points, closing at 14,533.
.jpg)
