MILK
Class IV futures were hit hard today primarily in the last quarter of this year. October closed 60 cents lower. November was down 52 cents and December was down 50 cents. The fall of Grade A nonfat dry milk as much as it had today is very seldom seen. The volume of loads traded adds to the bearishness. Class III futures were mostly lower even though cheese prices increased. Traders are not convinced prices will hold even though they bounced today. Each time we see another leg down, it will be more difficult for the market to uncover any bullishness. It has been a brutal week for milk futures even though the first half of the week looked promising. Class III milk futures have fallen more than anyone anticipated with Class IV futures possibly beginning to come under further pressure than it has been so far.
AVERAGE CLASS III PRICES
| 3 Month: | $19.79 |
| 6 Month: | $19.93 |
| 9 Month: | $19.72 |
| 12 Month: | $19.58 |
CHEESE
For the week, block declined 9.50 cents with 6 loads traded. Barrels declined 9.50 cents with 16 loads traded. Dry whey price increased 1.50 cents with only one load traded. Even at lower prices, buyers seem to have no interest in buying supply for upcoming demand. One reason is that they are uncertain what that demand will be. They already have some on hand that was purchased early in the year when there was much concern over supply. Buyers wanted to make sure the increased holdings in case milk supply would tighten and cheese supply would be short. Now they remain unaggressive.
BUTTER
For the week, butter increased 2 cents with 11 loads traded. Grade A nonfat dry milk fell 13.75 cents with 16 loads traded. There were 13 loads traded just today. It seems as if butter may slip back below $3.00 again and into the range it had been in. Higher prices this week may have been the threshold. Some negative influence may have come from the Dairy Products report which showed butter production in June higher than a year ago.
OUTSIDE MARKETS SUMMARY
September corn gained 8 cents ending at $6.1025. August soybeans slipped 0.25 cents ending at $16.1475 with August soybean meal down $14.60 per ton closing at $499.10. September wheat declined 6.75 cents ending at $7.7575. August live cattle gained $0.17 closing at $137.87. September crude oil gained $0.41 closing at $89.01 per barrel. The DOW gained 77 points closing at 32,803 while the NASDAQ declined 63 points closing at 12,656.
