MILK
Milk futures again took the path of least resistance which was lower. No buyers showing up in the spot market left trading wondering where buyers might find it attractive to step up and purchase supplies. Prices have already declined more than anticipated as it looks like there could be further pressure. The weather in the Midwest has been somewhat mild allowing for good milk production. Good quality forage has been harvested aiding in the ability to reduce some of the purchasing of supplements. Corn futures fell due to more widespread rains that developed over the weekend. There is a lot of summer yet to go which could impact forage, corn, and soybean crops. The corn crop last week declined 3% in the good/excellent category to 67% which was more than expected. The soybean crop also declined 3% in the good/ excellent category to the current level of 65%. Corn is still 3% higher than last year with soybeans 5% above a year ago.
AVERAGE CLASS III PRICES
| 3 Month: | $23.28 |
| 6 Month: | $23.37 |
| 9 Month: | $22.95 |
| 12 Month: | $22.42 |
CHEESE
The stability of block cheese price today did nothing to support Class III futures. Cheese futures also suffered some losses but continue to carry a premium to the market. It is not likely prices will continue to decline without any bounce or even some price strength for a time through the rest of the year. However, the decline over the past month will be very difficult to overcome as cheese inventory is growing and there are some indications demand is slipping.
BUTTER
Butter is in a better position for maintaining a stronger price than cheese. Inventory remains below a year and probably will not exceed year-earlier levels through the rest of this year. The uncertainty is the amount of butter buyers have already purchased ahead for later this year. There remains interest in buying butter, but not as aggressive as it had been a few weeks ago. The level of $2.90 might hold support by generating some heavier buying interest.
OUTSIDE MARKETS SUMMARY
July corn declined 6 cents closing at $7.4425. July soybeans jumped 19.75 cents ending at $16.3050 with July soybean meal up $10.10 per ton closing at $442.70. July wheat fell 19.75 cents closing at $9.04. June live cattle gained $0.90 closing at $136.25. August crude oil gained $1.95 closing at $109.57 per barrel. The DOW declined 62 points ending at 31,438 while the NASDAQ declined 83 points ending at 11,525.
