MILK
Milk futures closed the day strong with both Class III and Class IV futures showing similar gains. Class III futures have six contracts above $20.00 with two of those contracts closing above $21.00. What is interesting is that Class III contracts were strong despite cheese prices remaining unchanged. For a period of time, steady cheese prices were unable to provide support resulting in traders selling the market. One can hope this is signaling a change in the market and higher prices will unfold. More milk is and will be moving to deficit areas as they prepare to fill school pipelines. This takes place each year which pulls milk away from manufacturing reducing the output of manufactured products. This may reduce supply enough to increase buyer interest as they prepare for a seasonal increase in demand. There is much debate this year as to how much supply will be needed to satisfy demand due to some already being forward purchased plus the uncertainty of demand. Retail milk sales are termed as stable at the present time. Exports of dairy products are strong.
AVERAGE CLASS III PRICES
| 3 Month: | $20.36 |
| 6 Month: | $20.58 |
| 9 Month: | $20.29 |
| 12 Month: | $20.07 |
CHEESE
Dairy Market News reports that cheese demand has varied over the past few weeks, but that recent demand has turned more consistent. However, demand is running slightly lower than usual for this time of year. Cheese buyers seem comfortable with the current supply but are keeping a close watch on demand. If something looks slightly more bullish on either the supply or demand side, buyers may be quick to step up to purchase supplies for anticipated demand. At this point, spot milk is available for manufacturing and still generally at a discount.
BUTTER
The fluctuation of butter price today did not have an impact on Class IV futures. The strength stemmed from the increase of nonfat dry milk after 10 consecutive days of steady and declining prices. Over that period nonfat dry milk price fell 22 cents as it was in a freefall. Butter is holding well remaining in a long-term sideways pride
OUTSIDE MARKETS SUMMARY
September corn gained 5.75 cents closing at $6.2125. August soybeans declined 4.50 cents ending at $16.8875 with August soybean meal up $2.00 per ton closing at $515.60. September wheat gained 18.25 cents closing at $7.9975. August live cattle gained $1.22 ending at $139.20. September crude oil gained $1.43 closing at $91.93 per barrel. The DOW jumped 535 points ending at 33,310 while the NASDAQ jumped 361 points closing at 12,855.
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