MILK
Milk futures made a valiant attempt to move higher earlier this week fueled by the strength of barrel prices. However, the rally was short-lived as has been the pattern for the past few months. If the market cannot break out of this pattern during this time of year, the price outlook for the rest of the year and into next year does not look very promising. Not only will milk prices have a difficult time trending higher, but higher food prices will also have an impact. Fluid milk demand has been stable with cheese and butter demand somewhat variable. The real concern will be once the greater part of holiday buying is finished; regular demand may not be supportive to the market. Cow numbers declined 2,000 head in September from the previous month according to the milk production report. The September Livestock Slaughter report showed dairy cattle slaughter down 4,000 head from September 2021 at 260,500 head and 5,600 head below August. Farms may have culled out much of what they wanted to prior to this time of year and/or they are holding onto cows due to increased feed supplies and relatively good milk prices.
AVERAGE CLASS III PRICES
| 3 Month: | $20.82 |
| 6 Month: | $20.21 |
| 9 Month: | $20.09 |
| 12 Month: | $20.06 |
CHEESE
For the week, blocks increased 0.75 cents with one load traded. Barrels increased 3.50 cents with 13 loads traded. Dry whey slipped 0.25 cents with one load traded. The movement of prices took place with limited activity. Buyers and sellers are accomplishing most of their business out in the country with limited need to come to the spot market. This pattern is expected to continue as more cheese is available through regular channels. There are some reports from some manufacturers that demand is good, and they are having difficulty keeping up with orders. However, cheese supply is readily available overall.
BUTTER
For the week, butter price increased 2.50 cents with no loads traded. It is very unusual for no trading activity to develop during the week. It has been a long time since there has been a week with no loads traded in the spot market. Much of the year has shown strong weekly trading volume. Grade A nonfat dry milk declined 7 cents with 13 loads traded. Price is now at the lowest level it has been since October 5, 2021, with further weakness expected. USDA will release the September Cold Storage report on Monday.
OUTSIDE MARKETS SUMMARY
December corn gained 0.25 cents closing at $6.8425. November soybeans gained 4 cents closing at $13.9550 with December soybean meal up $4.60 per ton closing at $417.90. December wheat gained 1.50 cents ending at $8.5075. October live cattle gained $0.70 ending at $150.47. December crude oil increased $0.54 closing at $85.05 per barrel. The DOW jumped 749 points closing at 31,083 while the NASDAQ gained 245 points closing at 10,860.
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