MILK
Milk production continues to decline seasonally. Hotter weather in many areas is impacting milk production as cow comfort is less than ideal. Milk supply is available for bottling and manufacturing with spot milk purchased to fill in any deficit. Spot milk availability is not quite as plentiful as it has been a few weeks ago. Lower milk receipts at plants have increased some of the demand for extra milk. Spot milk still carries a discount to class but not as much as it had been. Milk futures have been hit hard this week and over the past month. Trader psychology turned bearish not only from some slowing of demand but also from the high inflation rate. With buyers of cheese having already purchased more supply than usual earlier this year, they see no need to be aggressive now. The uncertainty of demand will leave them assessing their current supply with the potential of demand through much of the rest of the year. Class III futures closed with no contracts this year remaining above $21.00 and no contracts next year above $20.00.
AVERAGE CLASS III PRICES
| 3 Month: | $21.15 |
| 6 Month: | $20.96 |
| 9 Month: | $20.53 |
| 12 Month: | $20.24 |
CHEESE
After holding for a few days, cheese prices fell to lower levels with sellers wanting to move product and buyers nowhere to be seen. Prices are unable to find solid support due to the uncertainty over demand the rest of the year. Many manufacturing plants are running full schedules based on their workforce. However, the lack of a full workforce has most plants running below capacity. Yet, that has not tightened supply due to the impact of high grocery prices and slowing retail and food service demand.
BUTTER
Butter production remains steady as cream is available for manufacturing. Many plants would like to increase output but are limited due to the lack of a full workforce. This sounds like a broken record and is getting rather old news. However, the fact that there is a lack of workers will likely be an ongoing issue for a time. Bulk butter supply is growing indicating a slowing of food service demand.
OUTSIDE MARKETS SUMMARY
September corn closed 5 cents higher at $6.05. August soybeans declined 13 cents ending at $14.7175 with August soybean meal up $1.70 per ton closing at $438.90. September wheat fell 15.75 cents closing at $7.95. August live cattle fell $1.47 closing at $135.40. August crude oil declined $0.52 closing at $95.78 per barrel. The DOW declined 143 points closing at 30,630 while the NASDAQ gained 4 points closing at 11,251.
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