MILK
There is a strong correlation between corn and milk prices, but it is not an immediate correlation. Corn prices have fallen significantly over the past two days, but it has not had any spillover effect. If corn prices continue to trend lower reducing the cost of feed, it may eventually have an impact. Milk futures were higher today following the minor increases of underlying cash. The Federal Order prices will be released tomorrow for the month of May. Traders anticipate a Class III price of $25.20 and a Class IV price of $25.07. Class III will be a new record and may be the high for the year if the market continues along the current course. The June futures contract will take over as the front month tomorrow. The Farm Service Agency released the average soybean meal price for April used in the calculation of income over feed for the Dairy Margin Coverage program. The soybean meal price was $476.70 per ton, a decrease of $17.28 per ton from March, but $63.07 per ton higher than a year ago. This put the income over feed at $12.29 and the highest since July 2020. There will be no Dairy Margin Coverage payment.
AVERAGE CLASS III PRICES
| 3 Month: | $24.53 |
| 6 Month: | $24.31 |
| 9 Month: | $23.66 |
| 12 Month: | $23.01 |
CHEESE
Cheese demand is termed as mixed this week. Some varieties may be seeing slower demand due to time of year and price. Other varieties are seeing steady sales. Dairy Market News reports that cheddar producers are seeing inventory building a little more rapidly than earlier in the year. That may be the reason American cheese inventory grew in April after decreasing the previous three months. Curd and process cheese demand remains strong.
BUTTER
Butter output has slowed somewhat for various reasons. There is sufficient cream available. Some plants are scheduling some downtime for maintenance. Some are having difficulty finding sufficient workers to keep plants running at full capacity. The market is not tight but remains supported as buyers continue to look ahead with their purchases.
OUTSIDE MARKETS SUMMARY
July corn fell 22.25 cents closing at $7.3125. July soybeans gained 7 cents closing at $16.9025 with July soybean meal down $2.10 per ton closing at $412.70. July wheat fell 46.25 cents ending at $10.4125. June live cattle jumped $2.27 closing at $132.80. July crude oil increased $0.59 closing at $115.26 per barrel. The DOW declined 177 points closing at 32,813 while the NASDAQ declined 87 points closing at 11,994.
