MILK
Traders had started to become a bit more friendly to the market as cheese prices increased from their lows. The weakness of blocks yesterday followed by steady prices today caused traders to liquidate as they are unwilling to wait to see whether prices will remain supported. Trading activity was rather light which magnifies some of the price movement. Class IV futures were unchanged to mixed as the weakness of butter and nonfat dry milk had little impact. Milk production across the country continues to decline due to the impact of hot weather and the inability of production to rebound after cows have been significantly impacted. Bottling demand has increased as school accounts are filled. The closing of two Borden Dairy Company plants, one in Dothan, Alabama, and the other in Hattiesburg, Mississippi, is requiring more than 100 school districts to find other suppliers to fill school milk needs.
AVERAGE CLASS III PRICES
| 3 Month: | $20.21 |
| 6 Month: | $20.48 |
| 9 Month: | $20.35 |
| 12 Month: | $20.25 |
CHEESE
The negative aspect today was not so much that cheese price remained steady, but that only sellers showed up in the spot market. Those sellers were not aggressive leaving prices unchanged, but it did increase the concern of traders. Export demand for cheese is steady to higher as price is competitive on the world market.
BUTTER
Price continues to trade in a range with buyers and sellers comfortable at the current level. With the current level of production and inventories below a year ago, there is little downside price risk. This keeps buyers active but unwilling to purchase if price moves above $3.00. Cream supply is variable with some plants having to limit orders for the time being that are being requested by customers.
OUTSIDE MARKETS SUMMARY
September corn gained 4.75 cents closing at $6.1975. September soybeans jumped 20.25 cents closing at $14.9550 with September soybean meal up $8.80 per ton closing at $449.40. September wheat fell 31.75 cents ending at $7.3150. August live cattle declined $0.47 closing at $141.27. September crude oil gained $2.39 closing at $90.50 per barrel. The DOW gained 19 points closing at 33,999 while the NASDAQ gained 27 points closing at 12,965.
