MILK
The action of Class III futures this week would give the impression the market was awash in milk as cheese prices fell substantially lower. Such is not the case as increased amounts of milk are moving to bottling for the school systems and the price movement of cheese for the week was mixed compared to last Friday. However, Class III futures eliminated any gains realized over the past two weeks. Milk continues to slow seasonally with hot weather still in place in areas of the country with corn silage harvest taking place or will be taking place in a few weeks. Milk production will eventually turn higher, but gains may be slow to unfold. An increase of cow numbers will be limited due to the tight supply of replacements. Growth will take place internally and will take time. Monday will be a day of reports with both the July Milk Production and July Cold Storage reports released. These reports should provide some price movement and possibly some market direction.
AVERAGE CLASS III PRICES
| 3 Month: | $19.94 |
| 6 Month: | $20.19 |
| 9 Month: | $20.05 |
| 12 Month: | $19.99 |
CHEESE
For the week, blocks declined 2.50 cents with three loads traded. Barrels increased 0.85 cents with eight loads traded. Dry whey increased 0.50 cents with two loads traded. This was not much movement, but it did have a substantial bearish impact on Class III futures. Cheese buyers continue to purchase on an as-needed basis limiting upside price potential. It will be more difficult to get traders excited over buying into the market now that an extended price increase did not solidify a solid change in trend.
BUTTER
For the week, butter gained 0.50 cents with 48 loads traded. Grade A nonfat dry milk price 0.25 cents with 13 loads traded. Price tested the upper end of the trading range midweek but could not find sufficient buyer interest to push it higher. Buyers and sellers remain comfortable in the current price range. There is little concern over supply tightness through the end of the year.
OUTSIDE MARKETS SUMMARY
September corn gained 6.25 cents closing at $6.26. September soybeans declined 6.75 cents ending at $14.8875 with September soybean meal down $0.70 closing at $448.70 per ton. September wheat jumped 21.75 cents closing at $7.5325. August live cattle gained $0.32 closing at $141.60. September crude oil gained $0.27 closing at $90.77 per barrel. The DOW declined 292 points ending at 33,707 while the NASDAQ declined 260 points closing at 12,705.
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