MILK
Class IV futures pushed higher with July closing above $26.00. This is the first time Class IV has ever moved above $26.00. July could continue to move higher if support remains under butter and nonfat dry milk prices. Class III futures were moderately higher through January and then mixed thereafter. The weakness of barrel cheese was again discounted as traders remain optimistic that downside will be limited. Milk production is leveling off in many areas indicating spring flush is winding down. Some areas continue to see increasing production, but that is slowing. Weather is good allowing milk production to remain strong as feed intake remains good. Good quality forage has been, and is being, harvested which should keep milk production holding well. Milk components remain high. The May Federal Order class prices were announced. Class II price was $25.87, up $0.16 from April and up $9.65 from a year ago. Class III price was $25.21 and a new record. Price increased $0.79 from April and $6.25 higher than a year ago. Class IV price was $24.99, down $0.32 from April, but up $8.83 from May 2021.
AVERAGE CLASS III PRICES
| 3 Month: | $24.51 |
| 6 Month: | $24.34 |
| 9 Month: | $23.71 |
| 12 Month: | $23.03 |
CHEESE
There is strong international demand for cheese which is keeping inventory from building very much. Exports were up substantially in 2021 from 2020. This year is currently on track to exceed the amount of total dairy products and the value of those exports over last year. Domestic consumption may be impacted by inflation if food prices continue to increase and there is little relief from high fuel prices. Current cheese prices are range bound.
BUTTER
Price has now reached back to the high of the year of January 21. Buyers have remained aggressive as price has been increasing. Activity has been good with sellers selling as price moves higher. There is sufficient supply for demand with limited interest in holding supply for potentially higher prices. Price may be near resistance as buyers may be unwilling to purchase much higher than the current level.
OUTSIDE MARKETS SUMMARY
July corn declined a penny closing at $7.3025. July soybeans jumped 39 cents closing at $17.2925 with July soybean meal futures up $2.20 per ton closing at $414.90. July wheat gained 17 cents closing at $10.5825. June live cattle gained $0.82 closing at $133.62. July crude oil gained $1.61 closing at $116.87 per barrel. The DOW jumped 425 points closing at 33,248 while the NASDAQ jumped 322 points closing at 12,317.
