MILK
Milk futures showed strength today but not as much as one would have anticipated given the strength of underlying cash. The Class III market will need to find solid support from underlying cash or price increases will be shaky and short-lived. Traders are not willing to buy into the market aggressively as the pattern has been that any strength has been short-lived resulting in still lower prices after a brief price rally. The pattern will not continue forever, but in the current market environment it may last for a time leaving the market in limbo. Traders are not trading for the long term but rather trading on a short-term basis creating a choppy market. Dairy Market News reports that milk production in the Northeast is steady while production in the Mid-Atlantic states continues to decline. However, there remains sufficient supply available for both bottling and manufacturing.
AVERAGE CLASS III PRICES
| 3 Month: | $20.34 |
| 6 Month: | $20.59 |
| 9 Month: | $20.56 |
| 12 Month: | $20.51 |
CHEESE
There are some reports of cheese buying interest increasing. Some report they are behind on orders. This may not mean that they cannot produce supply due to plants being at capacity. However, some plants are at capacity due to labor shortages which are causing the inability to meet the needs of buyers in a timely manner. Spot milk prices during the holiday remained at class or above indicating the supply of extra milk is lessening. Cheese exports in July slowed from the growth seen over the past few months, Exports were up 1.6%.
BUTTER
Buyers remain aggressive looking for supply for orders and for expected demand. Although domestic demand has slowed somewhat, export demand is very strong. July butter exports were up 63.1% over July 2021. International demand remains strong as world butter supplies are tight. Price reached a new record high today with potentially more upside yet to come based on buying interest.
OUTSIDE MARKETS SUMMARY
September corn declined 4 cents closing at $6.7675. September soybeans fell 23.25 cents closing at $14.6675 with September soybean meal up $2.60 per ton closing at $436.10. September wheat jumped 26.50 cents closing at $8.2650. October live cattle declined $0.80 ending at $144.25. October crude oil fell $4.94 closing at $81.94 per barrel. The DOW gained 436 points closing at 31,581 while the NASDAQ gained 247 points closing at 11,792.
