MILK
Class III milk prices continue to take a beating with nearby contracts showing double-digit losses again. Traders are concerned prices may not stop at the level of the previous lows this time around. The weakness is a little more than expected for this time of year. USDA released the May Milk Production report today8 showing milk production in the top 24 states down 0.6% from May 2021. Milk per cow increased 8 pounds from a year ago reaching 2,114 pounds for the month. Cow number totaled 8.91 million head, up 2,000 head from April. Milk production in the nation decreased 0.7% from a year ago with production per cow up 8 pounds at 2,096 pounds for the month. Cow numbers increased 2,000 head from April with the nation's herd now at 9.41 million head. There were 6 states which showed milk production gains from the previous year. These states were South Dakota with an increase of 15.2%. Georgia increased 11.9%. Texas showed an increase of 5.8%. Iowa was up 3.1%. Oregon increased 1.3%. Wisconsin was up 0.8%.
AVERAGE CLASS III PRICES
| 3 Month: | $23.81 |
| 6 Month: | $23.69 |
| 9 Month: | $23.20 |
| 12 Month: | $22.64 |
CHEESE
Block cheese nearly eliminated the gains of Friday with no one willing to buy even at lower prices. Traders feared this would take place after the bounce on Friday and they were partially correct. There is a strong possibility barrels may not hold the recent gains. Cheese production is active but is not overwhelming the market. There are indications demand is slowing which is causing buyers to hold back rather than add to supplies already on hand.
BUTTER
Butter continues to hold well but price may slowly grind lower. Both food service and retail demand are slowing. This goes along with the rise in prices and consumers having less disposable income. I believe dairy demand will pair better than some other food items, but the impact is uncertain. Traders will err on the side of caution.
OUTSIDE MARKETS SUMMARY
July corn fell 23.75 cents closing at $7.6075. July soybeans fell 21 cents closing at $16.81 with July soybean meal down $6.80 per ton closing at $431.30. July wheat fell 59 cents closing at $9.7525. June live cattle declined $0.20 ending at $137.82. July crude oil gained $1.09 closing at $110.65 per barrel. The DOW jumped 641 points closing at 30,530 while the NASDAQ gained 271 points closing at 11,069.
