MILK
It was another strong close for milk futures even though there was minimal price movement of underlying cash. This provided hope that the market is finding support. However, traders are not getting too excited about further gains unless the market proves that cheese prices have found support and butter prices will continue to hold. Some areas indicate milk is a bit tighter due to hot weather and the opening of schools requiring more milk to move to bottling. This leaves less for manufacturing keeping supply manageable rather than growing. Milk is moving around to those areas that are deficit for the time being. This leaves spot milk available generally at class price. The Global Dairy Trade auction took place earlier this week with the trade weighted average up 4.9% compared to the previous auction. This is the first increase after 5 consecutive declines. There were 174 participants in the event with 27,127 metric tons sold. Anhydrous milk fat price jumped 13.9% to $5,677 per metric ton or $2.58 per pound. Butter price increased 3.3% $5,369 per metric ton or $2.44 per pound. Buttermilk powder declined 5.1% to $3,537 per metric ton or $1.60 per pound. Cheddar cheese increased 1.0% to $5,046 per metric ton or $2.29 per pound. Skim milk powder gained 1.5% to $3,575 per metric ton or$1.62 per pound. Whole milk powder increased 5.1% to $3,610 per metric ton or $1.64 per pound. Lactose and sweet whey powder were not offered at this event.
AVERAGE CLASS III PRICES
| 3 Month: | $20.49 |
| 6 Month: | $20.80 |
| 9 Month: | $20.79 |
| 12 Month: | $20.71 |
CHEESE
Retail cheese demand has been about steady with reports of food service demand increasing slightly. Now that football season is moving into full swing mozzarella cheese sales are improving to pizza manufacturers. Cheese buyers give no indication they are short bought as they have been able to purchase on price weakness.
BUTTER
It was surprising more butter buying interest was not seen during spot trading today. With strong buying yesterday and quite a few unfilled bids remaining at the close, it was anticipated orders needed to be filled and buyers would be active again today. However, buyers may have held out hoping sellers would want to take advantage of the high price to move some product. That did not happen with business possibly pushed off until tomorrow. It does not appear the top has yet been established.
OUTSIDE MARKETS SUMMARY
September corn declined 2.25 cents closing at $6.7450. September soybeans increased 3.75 cents closing at $14.7050 with September soybean meal down $8.30 per ton closing at $427.80. September wheat lost 16 cents closing at $8.1050. October live cattle gained $0.12 ending at $144.37. October crude oil increased $1.60 closing at $83.54 per barrel. The DOW gained 193 points closing at 31,775 while the NASDAQ gained 70 points closing at 11,862.
