Wednesday Closing Dairy Market Update - November Class III Price Was $21.01

MILK

Underlying cash did not provide much direction to traders today which left milk futures generally unchanged to lower. There were a few contracts with minor strength. Cash market activity has slowed significantly as buyers and sellers have not been very aggressive. This may be the pattern we will see through the end of the year. The November Federal Order prices were announced today showing a decrease in all classes. The Class II price was $24.67, a decrease of $1.06 from the previous month. Class III was $21.01, a decrease of $0.80 from October. The Class IV price was $23.30, a decrease of $1.66 from October. USDA released the Agricultural Prices report for October. The average corn price for the month was $6.50 per bushel, a decline of $0.59 from the previous month. Soybean price averaged $13.50, down $0.60 from September. Alfalfa hay price averaged $281 per ton, up $4.00 from the previous month. Premium/supreme hay averaged $348 per ton, an increase of $6.00 from September. The All-milk price was $25.90, up $1.50 per cwt from September. FSA has not yet updated the average soybean meal price. That leaves us without the ability to calculate the income over feed price for the Dairy Margin Coverage program. Soybeans and alfalfa hay are not used in the calculation. I just included those to see the price change from September.

AVERAGE CLASS III PRICES

3 Month:	$19.56
6 Month:	$19.68
9 Month:	$19.83
12 Month:	$19.92

CHEESE

Cheese plants report a slowdown in demand over the past week. This is usual at this time of year as many of the orders have been filled or product is in place and ready to be shipped. Spot milk is not as discounted as it was last week, but it is still running below class. With the recent price weakness, buyers have generally stepped back waiting to see where prices will go and how demand was shaping up through the end of the year.

BUTTER

Churning has been active with sufficient cream available for production. Many plants are running at or near capacity as they are churning for demand and to rebuild inventory. Some plants are being offered more cream than they can handle at the present time. Demand remains strong even though many of the holiday orders have been filled.

OUTSIDE MARKETS SUMMARY

December corn declined 3.75 cents closing at $6.62. January soybeans gained 10 cents closing at $14.6950 with December soybean meal up $9.20 per ton closing at $417.70. December wheat gained 13.765 cents closing at $7.7150. December live cattle increased $0.40 closing at $153.07. January crude oil gained $2.35 ending at $80.55 per barrel. The Dow jumped 737 points closing at 34,590 while the Nasdaq jumped 484 points closing at 11,468.

Wednesday Midday Dairy Market Summary - Nonfat Dry Milk Falls to New Low

OUTSIDE MARKETS SUMMARY:

CORN:	3 Lower
SOYBEANS:	10 Higher
SOYBEAN MEAL:	$9.30 Higher
LIVE CATTLE:	$0.72 Higher
DOW JONES:	155 Points Lower
NASDAQ:	32 Points Higher
CRUDE OIL:	$2.08 Higher

MIDDAY MARKET UPDATE:

Block cheese price showed further weakness with a decline of 2.50 cents closing at $2.0650 with no loads traded and no buyers showing up to the market. Barrel cheese price increased 1.75 cents, closing at $1.8175 with no loads traded and no sellers showing up during spot trading. Dry whey remained unchanged at 45 cents with one load traded. Class III futures are seeing some support as the day progresses. Contracts are mixed ranging from 17 cents lower to 10 cents higher. Gains are seen in November and December 2023 contracts that have not seem much trading activity. Butter price slipped 0.50 cent, closing at $2.9250 with no loads traded. Grade A nonfat dry milk price declined 2.75 cents, closing at $1.36 with two loads traded. Nonfat price has moved to the lowest level since Sept. 27, 2021, falling below the low from early November. However, even with that pressure Class IV contracts are mixed from 10 cents lower to 8 cents higher and have only traded in contracts from May 2023 through the end of 2023. The November Federal Order prices will be announced today. USDA will release the October Agricultural Prices report at 2 p.m. CST, providing price used in the calculation of income over feed for the Dairy Margin Coverage program.

Wednesday Morning Dairy Market Update - Cheese Unable to Find Support

OPENING CALLS:

Class III Milk Futures:	Steady to 10 Lower
Class IV Milk Futures:	Mixed
Butter Futures:	Mixed

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	1 to 2 Higher
Soybean Futures:	8 to 12 Higher
Soybean Meal Futures:	$3 to $4 Higher
Wheat Futures:	5 to 7 Higher

MILK:

Class III milk futures have not been able to find support due to the weakness of cheese. Traders may become less interested in buying into the market due to time of year and limited trading activity of cheese. The December contract is reflecting further price weakness with price below $20.00. There has been quite a bit of volatility during the past year, but that may be limited as we move through the end of the year. Increasing milk production with increasing cheese and butter production will leave sufficient supply available to the market. Some input prices have been decreasing, which will help to improve the cost of production; but overall input prices remain high. Yet, adjustments have been made and milk production is running above a year ago. The November Federal order class prices will be announced Wednesday. USDA will release the October Agricultural Prices report this afternoon, which will provide prices used to calculate income over feed for the Dairy Margin Coverage program.

CHEESE:

The block/barrel spread has been narrowing and should continue to do so as blocks are expected to weaken more than barrels. The big demand push for the holidays seems to be mostly finished, leaving buyers less aggressive in the market. Spot prices may be choppy, but the overall trend seems to be down.

BUTTER:

Spot trading activity of butter has slowed but buyers and sellers remain comfortable at the current price level. Increased butter production will keep the market supplied and could rebuild inventory. The feared butter shortage increased demand for a period but that has run its course, leaving end users with extra butter on hand for the time being.

 

Tuesday Closing Dairy Market Update - Dairy Margin Coverage Sign-up Deadline Nears

MILK

Class III milk futures moved down to the lows established yesterday. Yesterday, prices rejected those lows with the idea the market was overdone. However, that was not the case today as further weakness of block cheese and renewed weakness of barrels pushed prices lower. Class IV futures were mostly unchanged due to little movement of underlying cash. For those of you that have not yet signed up for the Dairy Margin Coverage program next year, you need to do so by December 9^th. At least that is the date USDA has indicated for the close of the signup period. However, I would not be surprised if it is not extended again as it has been ever since the program began, but do not delay and sign up by the date if you have not already done so. Supplemental Dairy Margin coverage can also be signed up for allowing farms that have increased production over the years to enroll their additional production using 2019 as a base. This needs to be enrolled in before signing up for the regular DMC program. If you have already signed up for the supplemental program last year, there is no need to sign up again.

AVERAGE CLASS III PRICES

3 Month:	$19.70
6 Month:	$19.79
9 Month:	$19.91
12 Month:	$19.97

CHEESE

The continued weakness of blocks and renewed weakness of barrels does not bode well for the market. There had been hopes holiday demand could keep prices supported, but it seems buyers have much of what they need on hand and will be less interested in buying to stock up for uncertain demand. There will be price fluctuations but likely not the periods of strength that have been seen. Increasing cheese production should supply the market with a sufficient product limiting the need for buyers to come to the spot market.

BUTTER

Buyers and sellers seem comfortable at the current level. It is unlikely price will remain at the current level through the end of the year unless demand continues to hold very strong. Churning is active with some plants reporting difficulty fill orders. Overall, increased production is allowing orders to be filled without difficulty. Buyers need to buy for customers but have little incentive to stock up.

OUTSIDE MARKETS SUMMARY

December corn declined 3 cents closing at $6.6575. January soybeans closed 2.25 cents higher at $14.5950 with December soybean meal down $5.10 per ton closing at $408.50. December wheat gained a penny closing at $7.5775. January crude oil gained $0.96 closing at $78.20 per barrel. The Dow was up one point at 33,850 at the time of this writing while the Nasdaq was down 66 points at 10,984.

Tuesday Midday Dairy Market Summary - Cheese Prices Decline

OUTSIDE MARKETS SUMMARY:

CORN:	3 Lower
SOYBEANS:	Unchanged
SOYBEAN MEAL:	$4.40 Lower
LIVE CATTLE:	$0.22 Higher
DOW JONES:	37 Points Lower
NASDAQ:	89 Points Lower
CRUDE OIL:	$1.11 Higher

MIDDAY MARKET UPDATE:

Block cheese price continued lower, declining 3.50 cents, closing at $2.09 with no loads traded. There was an uncovered offer remaining at the close with no buyers showing up to the market. Barrel cheese declined 1.75 cents, closing at $1.80 with two loads traded. There were three unfilled bids remaining at the close. Dry whey price increased a penny to 45 cents with one load traded. Class III futures are 39 cents lower to 6 cents higher. May showed the gain with three contracts traded. Butter price remained unchanged at $2.93 after initially trading 0.50 cent higher. There were two loads traded. Grade A nonfat dry milk price slipped 0.25 cent, closing at $1.3875 with no loads traded. Class IV futures have not yet traded with wide bids and offers posted. Butter futures are 0.25 lower to 3.25 cents higher. Dry futures are steady to 0.50 cent higher. November futures and options have ceased trading with the Federal Order prices to be announced Wednesday.

Tuesday Morning Dairy Market Update - Overnight Trading Indicates Weakness

OPENING CALLS:

Class III Milk Futures:	10 to 15 Lower
Class IV Milk Futures:	5 to 10 Lower
Butter Futures:	Mixed

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	Mixed
Soybean Futures:	5 to 8 Higher
Soybean Meal Futures:	$2 to $3 Lower
Wheat Futures:	1 to 3 Higher

MILK:

Class III milk futures were able to hold well Monday despite substantially lower prices during the day. Unusually high trading volume was able to provide support. However, overnight trade indicates the anticipation of further weakness of underlying cash. Steadily increasing milk production will leave sufficient supply for demand. Cheese and butter production is increasing, leaving little reason for buyers to be concerned over supply. Milk production is not anticipated to slow down through the winter as feed supply is plentiful for the most part. President Biden has called on congress to adopt a tentative labor agreement to avoid a railroad shutdown. The House will vote to adopt a tentative agreement, in essence forcing the unions to adopt the agreement and keep working. The last time this happened was in 1991 when congress passed and an agreement ordering railroad workers back to work after a 24-hour shutdown.

CHEESE:

Block cheese seems to be the category that will continue to weaken and narrow the gap between it and barrels. It is unlikely barrels will see much strength and, if they do, it may be short-lived. Most cheese for the holidays and been ordered and delivered or will be delivered over the next few weeks. With increasing cheese production, there is plenty of product available to meet demand.

BUTTER:

Price does not give the impression it will decline very much. However, once holiday demand is filled, price may settle back as buyers will no longer be aggressive. The next few weeks will be interesting as cash and December futures will need to converge with futures currently about 26 cents below cash.

Monday Closing Dairy Market Update - Milk Futures Hold Despite Underlying Weakness

MILK

Price swings were rather wide for the trading day with December and January falling significantly below $20.00 earlier in the trading day rebounding to close back above $20.00 again. Class III futures closed mixed after early trading did not look good. Intraday volatility may increase as we move through the end of the year. Traders are trading short-term only trying to take quick profits out of the market. It would seem unlikely milk prices will rally to any great extent unless demand is stronger than anticipated and increased orders surface through the end of the year. Milk production continues to slowly increase with overall weather good for milk production. Increasing milk production is allowing for more milk to be available for manufacturing. There is sufficient milk available for both fluid and manufacturing with no concern over supply tightness. Spot milk prices are holding well for this time of year with buyers willing to purchase extra available milk to keep plants running near capacity.

AVERAGE CLASS III PRICES

3 Month:	$20.41
6 Month:	$20.15
9 Month:	$20.10
12 Month:	$20.12

CHEESE

Block cheese is now taking its turn with price weakness. Previously, barrels were weak while blocks held. Blocks may now move down to narrow the price gap between them and barrels. Demand has been holding well with American cheese inventory in October slightly below a year ago. Cheese buyers have not stepped up aggressively to purchase barrels at the low price and may not be very interested in purchasing blocks either at this time of year. Any price bounce may be short-lived.

BUTTER

The slight weakness of butter today does not provide any indication of price direction. Butter may not show the same weakness as cheese with overall demand remaining strong both domestically and internationally. Traders believe price will weaken over the next few weeks as December futures post of price of around $2.68 compared to the current price of $2.93. It will be interesting to see what happens over the next few weeks as futures will need to converge to cash.

OUTSIDE MARKETS SUMMARY

December corn gained 0.75 cents closing at $6.6875. January soybeans jumped 21 cents closing at $14.5725 with December soybean meal up $4.80 per ton closing at $413.60. December wheat fell 18.75 cents ending at $7.5675. December live cattle declined $0.50 closing at $152.57. January crude oil increased $0.96 closing at $77.24 per barrel. The Dow fell 498 points closing at 33,849 while the Nasdaq declined 177 points closing at 11,0590.

Monday Midday Dairy Market Update - Spot Prices Slide

OUTSIDE MARKETS SUMMARY:

CORN:	Unchanged
SOYBEANS:	16 Higher
SOYBEAN MEAL:	$4.70 Higher
LIVE CATTLE:	$0.47 Lower
DOW JONES:	365 Points Lower
NASDAQ:	109 Points Lower
CRUDE OIL:	$0.88 Higher

MIDDAY MARKET UPDATE:

Block cheese price declined 2.50 cents closing at $2.1250 with two loads traded. Barrel cheese price remained steady at $1.8175 with no loads traded. Dry whey price remained unchanged at 44 cents with no loads traded. Class III futures had been under substantial pressure since the market opened last night but have trimmed the loss. The December contract was down 45 cents at one point but is currently down 7 cents. Contracts are mixed ranging from 13 cents lower to 21 cents higher. December has had a large amount of trading activity with over 1,000 contracts changing hands. Butter price declined 1.75 cents closing at $2.93 with one load traded. Grade A nonfat dry milk price declined 0.75 cents ending at $1.39 with no loads traded. Class IV futures have bit yet traded. Butter futures are 1.00 cents lower to 2.50 cents higher. Dry whey futures are 0.60-1.00 cents lower.

Monday Morning Dairy Market Update - Milk Futures Under Pressure

OPENING CALLS:

Class III Milk Futures:	10 to 20 Lower
Class IV Milk Futures:	5 to 10 Lower
Butter Futures:	Mixed

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	2 to 4 Lower
Soybean Futures:	6 to 8 Lower
Soybean Meal Futures:	Steady to $1 Lower
Wheat Futures:	6 to 8 Lower

MILK:

With the extended weekend, traders seemed to believe it best to liquidate some of the long positions they held in anticipation of lower prices moving through the holidays. Milk futures were under pressure right from the start. Further selling is likely as underlying cash may reflect supplies of dairy products are mostly in position of holiday demand. Orders will continue to be placed but not as aggressively as they had been. Supply for orders and anticipated demand has been met. It will be up to ongoing demand to determine the strength of prices through the end of the year. Schools are back in session with fluid milk demand back to pre-holiday levels.

CHEESE:

The weakness of blocks Wednesday may have been an indication that pre-holiday demand may have been met. The weakness of barrels may be the anchor that will pull blocks down to narrow the spread. Higher cheese production should leave supply readily available to the market.

BUTTER:

Price continues to hold well as both domestic and international demand remains strong. Churning schedules have increased with plants wanting to meet demand as well as build inventory. Current supply remains lower than a year ago, but the gap is beginning to narrow. Butter futures to hold a discount through the end of the year and next year.

Wednesday Closing Dairy Market Update - December Class I Price Announced at $22.58

MILK

The advanced Class I price for December is $22.58, down $1.51 from the previous month. Some fluid milk buyers will hold off with purchases as much as possible to take advantage of lower December prices. Schools are closed for the rest of the week, which moves more milk to manufacturing. This milk will be handled with little difficulty and will be welcomed by some plants as they trying to keep up with orders. With increasing milk production running ahead of last year and inventory at high levels, there is little reason for buyers to become concerned over supply. USDA is proposing to modernize the Women, Infants, and Children's (WIC) program to provide more flexibility for independent grocers and families. The changes will increase the level of assistance by expanding whole grain options. It will also provide for more non-dairy substitution options such as soy-based yogurts and cheeses and require lactose-free milk to be offered. This has raised the ire of some in the dairy industry, as it will reduce the amount of dairy consumption through this program. Dairy markets will be closed the rest of the week with trading reopening Sunday evening at the regular time.

AVERAGE CLASS III PRICES

3 Month:	$20.47
6 Month:	$20.15
9 Month:	$20.10
12 Month:	$20.12

CHEESE

For the holiday-shortened week, blocks fell 8.25 cents with no loads traded. Barrels fell 11 cents with two loads traded. Dry whey was unchanged at 44 cents with two loads traded. The action of spot cheese prices was very uncertain with block price declining reluctantly. Barrels fell with little resistance, as buyers had sufficient supply on hand. Typically, cheese prices will soften through the end of the year as holiday orders are filled and demand begins to slow as buyers look ahead to business after the holidays.

BUTTER

The sharp decline and the rebound over the past week have been a sight to behold. This will not be the last time this type of volatility will be seen, but it does make one wonder where the balance of supply and demand will settle. For the week, butter jumped 13.75 cents with 17 loads traded. Grade A nonfat dry milk declined 3 cents with four loads traded.

OUTSIDE MARKETS SUMMARY

December corn gained 6.50 cents, closing at $6.6325. January soybeans gained 6.25 cents, closing at $14.36, with December soybean meal up $1.10 per ton, closing at $409.70. December wheat gained 2 cents, closing at $7.9350. January crude oil fell $3.01 per barrel, closing at $77.94. The Dow gained 96 points, closing at 34,194, while the Nasdaq gained 111 points, closing at 11,285.

Wednesday Midday Dairy Market Summary - Block Cheese Falls

OUTSIDE MARKETS SUMMARY:

CORN:	5 Higher
SOYBEANS:	9 Higher
SOYBEAN MEAL:	$2.50 Higher
LIVE CATTLE:	$0.02 Higher
DOW JONES:	5 Points Higher
NASDAQ:	58 Points Higher
CRUDE OIL:	$3.42 Lower

MIDDAY MARKET UPDATE:

Block cheese price declined 5 cents, closing at $2.15 with no loads traded. No buyers showed up to do any business, even with the weakness. Barrel cheese price increased 1.25 cents, closing at $1.8175 with no loads traded. No sellers showed up to do any business. Dry whey price remained unchanged at 44 cents. This has put substantial pressure on Class III futures. Contracts are 1 to 65 cents lower with December taking the brunt of it. Butter price increased 1.75 cents, closing at $2.9475 with six loads traded. Over the past three days, the market has erased the decline of Friday and then some. There was an offer for a load remaining at the close of spot trading. Grade A nonfat dry milk price decreased 2 cents, closing at $1.3975 with four loads traded. Class IV futures are 10 to 37 cents lower. Butter futures are 0.70 to 5.17 cents lower. Dry whey futures are steady to 0.25 cent higher.

Fluid Milk and Cream - Western U.S. Report 47

Milk production is mixed in California. Contacts note output has dropped slightly this week,     but overall November milk production is up from last month. Milk is available for     processing, and some stakeholders say loads of milk are being sold to processors in other     parts of the region. Demand is unchanged across all Classes. 

In Arizona, milk production is steady to higher amid cooler temperatures. Contacts say milk volumes remain tight, and processors continue to purchase loads from other states to meet their production needs. Across all Classes, demand is steady. 

In New Mexico, milk production is steady to higher. Some stakeholders say overall production is nearing 2021 volumes. Processors are sourcing milk from other parts of the region, as local volumes remain tight. Demand for Classes II and III are steady. Contacts say educational holidays have contributed to subdued Class I demand. 

Contacts in the Pacific Northwest say milk production is steady. Processors relay that milk is plentiful in the area, and this is allowing them to run steady production schedules. Limited tanker availability is delaying some milk deliveries. Demand is unchanged across all Classes. 

In the mountain states of Idaho, Utah, and Colorado, milk production is steady to higher. Milk volumes are ample, and some plant managers say they are offering loads of milk, priced below Class, to nearby facilities. Some stakeholders say labor shortages are hindering the movement of milk loads. All Classes of milk are in steady demand. 

Demand for contracted condensed skim is declining in the West. Some processing facilities in the region have reduced their purchasing ahead of Thanksgiving holiday closures. Spot volumes of condensed skim are limited. Increasing milk production is contributing to greater regional cream availability. Demand for cream is strong, but some contacts say loads of cream have been moving at lower multiples ahead of this week's holiday. Cream multiples moved lower at the top of the range, while the bottom was unchanged.

     Western U.S., F.O.B. Cream
     Price Range - All Classes; $/LB Butterfat:   3.0602 - 3.7597
     Multiples Range - All Classes:               1.0500 - 1.2900
     Price Range - Class II; $/LB Butterfat:      3.4683 - 3.7597
     Multiples Range - Class II:                  1.1900 - 1.2900

Wednesday Morning Diary Market Update - Light Trading Activity Expected

OPENING CALLS:

Class III Milk Futures:	Mixed
Class IV Milk Futures:	Mixed
Butter Futures:	Mixed

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	2 to 3 Higher
Soybean Futures:	1 to 2 Higher
Soybean Meal Futures:	$1 to $2 Higher
Wheat Futures:	2 to 4 Lower

MILK:

Milk futures have been reluctant to decline, even though there has been substantial pressure on barrel cheese. The minor decline of blocks leaves some traders believing there will be limited downside. More milk is being diverted to manufacturing, which should allow for more cheese to be available to the market. Increasing milk supply will keep sufficient supply available for bottling and manufacturing. Many plants are running on full schedules as milk production slowly increases in much of the country. Today will be the final day to trade dairy futures and options for the week. Dairy will be closed on Friday even though other markets will be open.

CHEESE:

The October Cold Storage report was neutral with cheese stocks declining and remaining close to inventory of a year ago. Cheese stocks could close the year lower than a year ago depending on end-of-year demand. Even though stocks are large, that certainly would be positive.

BUTTER:

Butter has shown surprising resilience, nearly gaining back what was lost last week. Price might be back at a level at which buyer aggressiveness may slow. Supply is sufficient through the end of the year. Plants have increased churning to meet demand and rebuild inventory. The Cold Storage report indicates inventory is gaining on last year, but it has a long way to go with inventory still 14% below.

Tuesday Closing Dairy Market Update - October Inventory Declined

MILK

Class III futures held well despite the further decline of barrel cheese price moving the block/barrels spread to 39.50 cents. Milk futures were mixed as traders seem to believe the downside of barrels may be limited. Milk production continues to slowly improve. There was quite a bit of disruption in the Buffalo, New York area with the record-breaking snowstorm. The impact was more on distribution in the area. That will not have much of an overall impact on supply and prices. As a result of schools closing for the Thanksgiving holiday, balancing plants are receiving limited loads of milk as milk is being diverted to manufacturing for a few days. Milk is generally readily available with some areas having to source their milk from other areas but finding sufficient supply without difficulty. Milk production continues to run above year-earlier levels as farmers push cows to help pay the bills. This results in more milk being available for both manufacturing and bottling. Milk production is expected to remain strong through the rest of the year. With the holidays approaching, all classes of milk are in strong demand for both general consumption and holiday products.

AVERAGE CLASS III PRICES

3 Month:	$20.82
6 Month:	$20.39
9 Month:	$20.30
12 Month:	$20.29

CHEESE

Cheese inventory declined in October as was expected. American cheese stocks declined 12.3 million pounds totaling 830.8 million pounds and 1% below a year ago. Swiss cheese inventory declined 1.7 million pounds to a total of 21.5 million pounds and nearly the same as last year. Other cheese stocks declined 7.7 million pounds totaling 595.9 million pounds and 2% above a year ago. Total cheese inventory declined 21.6 million pounds totaling 1.448 billion pounds and about steady with a year ago. This indicates strong demand and the potential for supply to be lower than at the end of last year.

BUTTER

Inventory declined 27.8 million pounds totaling 239.6 million pounds. This is 14% below a year ago. Inventory is catching up as September inventory was 18% below the previous year. Butter has nearly regained the loss of Friday making the end of last week look like an aberration. However, I expect to continue to see volatility through the end of the year.

OUTSIDE MARKETS SUMMARY

December corn declined 2.75 cents closing at $6.5675. January soybeans declined 7 cents closing at $14.2975 with December soybean meal down $2.80 per ton closing at $408.60. December wheat declined 7.75 cents ending at $7.9150. December live cattle gained $0.25 ending at $153.80. January crude oil. The Dow closed 398 points higher at 34,098 while the NASDAQ gained 150 points closing at 11,174.

Tuesday Midday Dairy Market Summary - Butter Moves Higher

OUTSIDE MARKETS SUMMARY:

CORN:	3 Lower
SOYBEANS:	7 Lower
SOYBEAN MEAL:	$3.10 Lower
LIVE CATTLE:	$0.07 Higher
DOW JONES:	317 Points Higher
NASDAQ:	98 Points Higher
CRUDE OIL:	$1.92 Higher

MIDDAY MARKET UPDATE:

Block cheese price remained unchanged at $2.20 with no loads traded. No buyers or sellers showed up during spot trading. Barrel cheese price declined 3.75 cents, closing at $1.8050 with one load traded. An unfilled bid and uncovered offer remained on the board at the close. Dry whey price remained unchanged at 44 cents. Butter price increased 3 cents, closing at $2.93 with five loads traded. Grade A nonfat dry milk price declined a penny to $1.4175 with no loads traded. Class III futures are mixed ranging from 15 cents lower to 10 cents higher. Class IV futures have only traded in the May contract with a decline of 24 cents. Butter futures are 1.00 cents lower to 1.10 cents higher. Dry whey futures are unchanged to 0.25 cent lower. USDA will release the October Cold Storage report Tuesday.

Tuesday Morning Dairy Market Update - Uncertainty Over Cash Direction

OPENING CALLS:

Class III Milk Futures:	Steady to 10 Lower
Class IV Milk Futures:	5 to 8 Higher
Butter Futures:	1 to 2 Higher

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	1 to 2 Higher
Soybean Futures:	Mixed
Soybean Meal Futures:	$1 to $2 Lower
Wheat Futures:	Mixed

MILK:

Class III milk futures were lower Monday in anticipation of and response to lower cheese prices. There is anticipation milk futures will remain under pressure the rest of this holiday-shortened week. Dairy markets will trade Tuesday and Wednesday and will be closed the rest of the week. The October Milk Production report was negative to the market as milk production remains above a year ago. Production per cow is strong and cow numbers are significantly higher than a year ago. The national dairy herd is 31,000 head higher than a year ago at 9.42 million head. This should keep milk production strong through the end of the year and into next year. There is concern over demand once the holiday period is over and consumers will be dealing with continued high food prices.

CHEESE:

The weakness of barrel cheese has been greater than expected, pushing price down to the lowest level since Aug. 8. Price may challenge the low of $1.7425 soon. If price would move below that level, it would move back to a level last seen in January. Blocks are in a better demand position, which may limit the decline for now. Buyers have not been interested in building inventory at this time but have been purchasing for immediate demand. USDA will release the October Cold Storage report Tuesday, which will provide some idea of supply and demand.

BUTTER:

The substantial rebound of butter Monday was a surprise due to the weakness experienced Friday. However, buyers wanted to take advantage of the lower price to increase ownership to meet demand. The inventory report will show a decline from September, but the decline may not be as great. The percentage of inventory compared to last year may be reduced as increased production may build supply.

Monday Closing Dairy Market Update - October Milk Production Gains 1.2%

MILK

Even though there was another large decline in barrels and a decline in blocks, Class III milk futures held well. Some of it had been factored in but some of the reason might be the disbelief that prices will continue to erode at this time of year. However, there is concern that the top may have been reached as the market is now heading into the holiday period when most of the buying that is done ahead of time is finished. Regular demand and fill-in buying for orders will be the main activity. USDA released the October Milk Production report today which showed continued strong milk output. Production in the top 24 states increased 1.4% totaling 18.1 billion pounds. Production per cow averaged 2,021, up 18 pounds from October 2012. Cow numbers increased 1,000 head and are 42,000 head more than a year ago. Milk production in the United States increased 1.2% totaling 18.9 billion pounds Production per cow averaged 2,001, up 17 pounds from a year ago. Cow numbers for both the U.S. and the top 24 states increased 1,000 head. Cow numbers are quite a bit higher than a year ago. The top 24 states showed 42,000 more cows while the U.S. showed 31,000 more cows than a year ago.

AVERAGE CLASS III PRICES

3 Month:	$20.93
6 Month:	$20.44
9 Month:	$20.31
12 Month:	$20.30

CHEESE

The weakness of block cheese today may start the ball rolling to the downside. It may not fall as rapidly as barrels, but buyers may hold back now as they saw weakness today. Demand will be ongoing but maybe not quite to the level it has been. Much of the aggressive purchasing to fill orders and to have extra on hand may have concluded with buying confined to fill-in orders or the desire to have some extra inventory on hand of fresh cheese.

BUTTER

The rebound of butter today keeps traders guessing as to where the market will settle when buyers and sellers find a comfortable level. Price did not regain all of the loss of Friday with buyers taking advantage of the lower price. The nature of the market is such that price could fall back again tomorrow. USDA will release the cold storage report tomorrow providing an idea of demand during October. Production is currently increasing as manufacturers want to build inventory over and above current demand.

OUTSIDE MARKETS SUMMARY

December corn declined 8.25 cents closing at $6.5950. January soybeans gained 8.50 cents closing at $14.3675 with December soybean meal up $1.00 per ton closing at $411.40. December wheat declined 4 cents closing at $7.9925. December live cattle gained $0.47 ending at $153.55. January crude oil slipped $0.07 ending at $80.04 per barrel. The Dow declined 45 points closing at 33,700 while the Nasdaq declined 122 points closing at 11,025.

October Milk Production up 1.4 Percent

October Milk Production up 1.4 Percent 

Milk production in the 24 major States during October totaled 18.1 billion pounds, up 1.4 percent from October 2021. September revised production, at 17.5 billion pounds, was up 1.5 percent from September 2021. The September revision represented a decrease of 13 million pounds or 0.1 percent from last month's preliminary production estimate. Production per cow in the 24 major States averaged 2,021 pounds for October, 18 pounds above October 2021. The number of milk cows on farms in the 24 major States was 8.93 million head, 42,000 head more than October 2021, and 1,000 head more than September 2022. 

October Milk Production in the United States up 1.2 Percent 

Milk production in the United States during October totaled 18.9 billion pounds, up 1.2 percent from October 2021. Production per cow in the United States averaged 2,001 pounds for October, 17 pounds above October 2021. The number of milk cows on farms in the United States was 9.42 million head, 31,000 head more than October 2021, and 1,000 head more than September 2022. 

Monday Midday Dairy Market Summary - Cheese Declines While Butter Rebounds

OUTSIDE MARKETS SUMMARY:

CORN:	6 Lower
SOYBEANS:	7 Higher
SOYBEAN MEAL:	$2.70 Higher
LIVE CATTLE:	$0.45 Higher
DOW JONES:	46 Points Lower
NASDAQ:	120 Points Lower
CRUDE OIL:	$0.94 Lower

MIDDAY MARKET UPDATE:

Block cheese price succumbed to the pressure from the weakness of barrels Block price declined 3.25 cents, closing at $2.20 with no loads traded. There was one seller attempting to move a load and was unable to find a buyer. Barrel cheese price fell 8.50 cents with one load traded. There were two unfilled bids and two uncovered offers remaining at the close. The block/barrel spread is now at 35.75 cents. Barrel price has fallen 21 cents over the past week. Dry whey price remained unchanged at 44 cents with no load traded. Class III futures are currently 34 cents lower to on cent higher with the only strength in front month November. Butter price rebounded 9 cents, taking back a large amount of what was lost Friday. Price closed at $2.90 with six loads traded. Grade A nonfat dry milk price remained unchanged at $1.4275 with no loads traded. Class IV futures only show one trade which took place in the May contract 11 cents lower. USDA will release the October Milk production report Monday afternoon. I estimate milk production to be up 1.4% from a year ago with cow numbers up 2,000 head compared to September. Milk production per cow is expected to be significantly above a year ago.

Milk Producers Ask for Support of Domestic Formula Production

The National Milk Producers Federation sent a letter to lawmakers asking for support of domestic infant formula production as the shortfalls that emptied store shelves of formula have eased. Given the improving situation, tariff waivers that could discourage the production of a safe, secure domestic infant formula supply should be allowed to expire at the end of this year as scheduled. The milk producers sent their letter to the chairmen and ranking members of the Senate Finance Committee and the House Ways and Means Committee. “Given the temporary shortfall that gripped American families in need of formula earlier this year has abated, we urge Congress to ensure that the unique, unilateral tariff benefits granted to our trading partners under the Formula Act and the Bulk Infant Formula to Retail Shelves Act end as scheduled at the close of the year,” the letter says. “We request opposition to efforts to extend the benefits.”

Proposed WIC Change Would Decrease Access to Dairy Products

The National Milk Producers Federation and the International Dairy Foods Association say the USDA’s proposed changes to the Women, Infants, and Children’s Nutrition Program will limit dairy access. “Unfortunately, the changes would decrease access to dairy products and the unique nutrient profile they provide, especially considering the current Dietary Guidelines say almost 90 percent of the U.S. population doesn’t consume enough dairy to meet recommendations,” the groups say in a statement. “Nutrition science clearly shows that nutritious dairy products like milk, yogurt, cheese, and cottage cheese are especially important in the diets of women, infants, and children.” They also say dairy is a source of 13 nutrients, including three of the four that are a public health concern as noted by the dietary guidelines. The groups look forward to working with USDA to modernize the WIC food package for eligible families to increase access to nutrient-dense milk, yogurt, and cheese.

Monday Morning Dairy Market Update - Further Weakness Expected

OPENING CALLS:

Class III Milk Futures:	5 to 15 Lower
Class IV Milk Futures:	10 to 20 Lower
Butter Futures:	2 to 3 Lower

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	3 to 5 Lower
Soybean Futures:	5 to 8 Lower
Soybean Meal Futures:	$1 to $2 Lower
Wheat Futures:	12 to 14 Lower

MILK:

The market may have run out of steam with underlying cash reflecting a slowing of demand due to much of the holiday aggressive purchasing having now been finished. Demand will be ongoing, but the retail and food service industry may already have much of their needs on hand or already contracted. This would allow buyers to be less aggressive on the spot market. USDA will release the October Milk production report Monday afternoon. I estimate milk production to be up 1.4% from a year ago with cow numbers up 2,000 head compared to September. Milk production per cow is expected to be strong.

CHEESE:

Block cheese price has been holding well despite the weakness of barrels. It is uncertain whether blocks would bring barrels back up again or if the weakness of barrels will pull blocks lower. There seems to be sufficient fresh cheese available to the market, which may limit further upside potential at this time of year. There will be ongoing demand but increasing cheese production may be sufficient to meet demand as well as build inventory.

BUTTER:

The large decline of price Friday is likely not the end of the weakness. Buyers will hold back, waiting to see if price will follow a repeat of the previous sharp decline. Buyers will be willing to purchase but at lower prices. The question is whether the previous sharp demand was an aberration or if the recent sharp rally was an aberration. The Cold Storage report Tuesday may provide a clearer picture.

Friday Closing Dairy Market Update - Markets End on a Bearish Tone

MILK

Milk futures were under pressure the last half of the week as weakness began filtering into the market. Traders are mixed as to how they view the activity of the week. Some were reluctant to sell out of positions thinking prices will find support as orders will need to be filled for increased holiday demand. Others have been quick to exit their short-term positions. The weakness of butter increased the bearishness. Milk futures have had a nice run higher following the strength of underlying cash. Prices fell substantially one month ago seemingly for no apparent reason other than aggressive selling in the cash market moving buyers to the sidelines. Now, it is a month later and a decline in prices would not be out of the ordinary. Fill-in buying that takes place as orders are placed may drive prices higher until those orders are filled. Cash prices then decline with milk futures following. There is sufficient milk available to the market supplying increased cheese and butter production. Milk production is expected to remain strong through the end of the year and likely through the first quarter of next year. Cow numbers are expected to hold with culling taking place only as needed.

AVERAGE CLASS III PRICES

3 Month:	$21.06
6 Month:	$20.63
9 Month:	$20.48
12 Month:	$20.45

CHEESE

Cheese prices diverged this week. Blocks increased 3.25 cents with no loads traded. Barrels fell 13.50 cents with eight loads traded. Dry whey price remained unchanged at 44 cents with two loads traded. Buyers of barrels have sufficient supply on hand and were purchasing as the price declined. Demand for barrel cheese for the holidays has generally been met. Price weakness is reflecting current supply and demand. The block/barrel spread moved to an inverted 30.50 cents. This is unusual for this time of year.

BUTTER

For the week, butter fell 10.50 cents with seven loads traded. Price fell 13 cents today with five loads traded. earlier gains during the week limited the decline. The movement today has brought back into focus the weakness of a month ago. Nonfat dry milk price slipped 0.25 cents with 16 loads traded. It is likely butter has turned the corner with price not likely to rebound very much through the end of the year. The weakness today will send buyers to the sidelines unless some immediate orders will need to be filled.

OUTSIDE MARKETS SUMMARY

December corn gained 0.25 cents closing at $6.6775. January soybeans increased 11.25 cents closing at $14.2825 with December soybean meal up $4.70 per ton closing at $410.40. December wheat declined 3.50 cents closing at $8.0325. December live cattle gained $0.32 closing at 153.07. December crude oil declined $1.56 closing at $80.08 per barrel. The Dow gained 199 points closing at 33,746 while the Nasdaq gained one point ending at 11,146.

Friday Midday Dairy Market Summary - Butter Plummets

OUTSIDE MARKETS SUMMARY:

CORN:	Unchanged
SOYBEANS:	10 Higher
SOYBEAN MEAL:	$3.80 Higher
LIVE CATTLE:	$0.52 Higher
DOW JONES:	98 Points Lower
NASDAQ:	43 Points Lower
CRUDE OIL:	$2.60 Lower

MIDDAY MARKET UPDATE:

Block cheese price remained unchanged at $2.2325 with no loads traded. An uncovered offer remained at the close with no buyers showing up Friday. Barrel price fell 5.25 cents to $1.9275 with three loads traded. There were five uncovered offers remaining at the close with no unfilled bids. Barrels have declined 11 cents over the past two days. Dry whey price remained unchanged at 44 cents with no loads traded. Butter price plummeted 13 cents closing at $2.81 with five loads traded. After the first load traded at the steady price, buyers were not willing to purchase unless price declined. Sellers were aggressive, wanting to move product and continued to offer lower. There was one uncovered offer remaining at the close. Grade A nonfat dry milk price declined 1.25 cents, ending at $1.4275 with five loads traded. Class III futures are 25 cents lower to 9 cents higher. Class IV futures have only shown trading in the April contract with price down 34 cents. Butter futures are 7.50 cents lower to 0.50 cent higher. Dry whey futures are unchanged to 0.95 cent lower.

Friday Morning Dairy Market Update - Selling Pressure Continued in Overnight Trade

OPENING CALLS:

Class III Milk Futures:	10 to 20 Lower
Class IV Milk Futures:	5 to 15 Lower
Butter Futures:	1 to 2 Lower

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	3 to 4 Higher
Soybean Futures:	7 to 9 Higher
Soybean Meal Futures:	$2 to $3 Higher
Wheat Futures:	6 to 8 Higher

MILK:

Milk futures were under pressure yesterday due to weakness of barrel cheese and butter. Overnight futures showed follow through pressure as further liquidation continued. It is unclear yet whether prices have reached a level of buyer resistance or if this is just business being done on an as-needed basis. Lower price may bring buyers back into the spot market if orders need to be filled. Milk production continues to improve with components increasing and currently running better than a year ago. Overall weather is good for cow comfort. Milk plants are running nearly full schedules with more milk moving to manufacturing as bottling slows for school accounts. The October Milk Production report will be released on Monday.

CHEESE:

Block cheese has held the gains of the past few weeks as demand for fresh cheese is strong with buyers coming to the spot market to pick up supply. Barrels are in the opposite position as supply has increased and/or demand has decreased. Barrel weakness may be temporary with lower increasing buying interest. However, this time of year is generally when much of the holiday demand has been filled except for ongoing fill-in buying. If so, cheese prices may weaken.

BUTTER:

Price weakness yesterday was the first decline in 10 consecutive trading sessions. Butter demand is termed as good for both food service and retail outlets. However, increased churning is increasing supply to the market. This may result in buyers stepping back a bit in anticipation of a lower price.

Thursday Closing Dairy Market Update - Milk Futures Remain Weak

MILK

Traders have been scalping the market or trading short-term trying to take a quick profit if it unfolds. There may not be very many long-term positions being held by speculators which limit futures movement when underlying cash moves. Hedgers are a different story as they generally will hold positions to expiration or until the desired protection is accomplished. Milk futures were under pressure as the weakness of underlying cash dictated lower prices. There are some who believe prices will hold strong moving through the holiday season. However, once the market feels orders are filled and supply is sufficient through the end of the year, spot prices will soften. Improving milk production is keeping many plants running on a full schedule. This keeps product available to the market and then some allowing inventory to increase. Bottling demand is beginning to slow as schools will be closed for a few days next week for Thanksgiving.

AVERAGE CLASS III PRICES

3 Month:	$21.17
6 Month:	$20.74
9 Month:	$20.58
12 Month:	$20.56

CHEESE

There are varying reports across the country as far as demand is concerned. Some plants report having difficulty trying to keep up with orders while other reports indicate retail demand is slowing. Loads of cheese are becoming a little easier to obtain. Some of this has to do with the variety of cheese. Exports have been strong all year and the recent decline of the U.S. Dollar might aid in keeping that demand strong. There is concern over domestic demand as food prices increase.

BUTTER

Butter sales are reported to be strong and somewhat in line with last year even though price is significantly higher. Churning is increasing as more cream is becoming available and manufacturers want to supply their regular customers as well as attempt to build some inventory. Inventory will end the year quite a bit less than last year. World market prices for butter have been trending slightly lower as consumption is being affected by strong prices. It is uncertain how butter demand will fare once the holidays are finished.

OUTSIDE MARKETS SUMMARY

December corn closed 2.25 cents higher at $6.6750. January soybeans declined 12.25 cents closing at $14.17 with December soybean meal declining $0.90 per ton closing at $405.70. December wheat declined 10.75 cents ending at $8.0675. December live cattle gained $0.95 ending at $152.75. December crude oil fell $3.95 ending at $81.64 per barrel. The Dow slipped 8 points closing at 33,546 while the Nasdaq declined 39 points closing at 11,145.

Thursday Midday Dairy Market Summary - Butter Shows Weakness

OUTSIDE MARKETS SUMMARY:

CORN:	2 Higher
SOYBEANS:	14 Lower
SOYBEAN MEAL:	$1.20 Lower
LIVE CATTLE:	$1.40 Lower
DOW JONES:	21 Points Higher
NASDAQ:	2 Points Higher
CRUDE OIL:	$3.71 Lower

MIDDAY MARKET UPDATE:

Block cheese price remained steady at $2.2325 with no loads traded and no one showing up to do any business. Barrel cheese price declined 5.25 cents, closing at $1.98 with one load traded. Price has fallen below $2.00 for the first time in six consecutive trading sessions. Dry whey price remained unchanged at 44 cents with no loads traded. With the block/barrel spread at 25.25 cents, it has increased the caution of traders over continued strength of blocks. Butter price declined 1.25 cents, closing at $2.94 with two loads traded. This is the first price decline in 10 consecutive trading sessions and a price increase of 34.25 cents. Buyers may have reached a threshold and are not willing to bid price higher anymore. Class III futures are 22 cents lower to 6 cents higher. Class IV futures have not yet traded. Butter futures are steady to 1.17 cents lower. Dry whey futures are 0.02 to1.75 cent lower.

Fluid Milk and Cream - Western U.S. Report 46

In California farm level milk production is unchanged this week. Processors are utilizing     available milk volumes to operate steady production schedules. Some stakeholders say they     are selling loads of milk to other states in the region. Class I demand is steady to lower;     stakeholders say some educational institutions have reduced their purchasing in preparation     for holiday breaks. Meanwhile, demands are unchanged for all other Classes. 

Milk output is steady in Arizona, but some stakeholders say production is below previously forecasted levels. Some processors say milk volumes are tight and they are purchasing milk loads from other states to meet their current production needs. Demand is steady across all Classes.     

Milk production is steady to higher in New Mexico, but some contacts report output is down     compared to this time last year. Processors in the state say milk availability is     increasing, but volumes remain tight enough that some are purchasing milk from other states.     Some educational facilities are reducing their Class I milk orders ahead of next week's     holiday. Demand is steady for Classes II and III. 

Milk production is trending higher in the Pacific Northwest. Stakeholders say plenty of milk is available, allowing processors to run busy production schedules. Some plant managers say limited tanker availability is contributing to delayed milk deliveries. Across all Classes, demand is steady. 

Milk output is increasing in the mountain states of Idaho, Utah, and Colorado. Tanker availability is tight, and some plant managers say they are offering available loads of milk at below Class prices to nearby processing facilities. Demand is steady for all Classes. 

Contract condensed skim sales are steady in the West. Stakeholders say spot purchasers are searching for additional loads of condensed skim amid tight spot availability. Cream is becoming more available in the region. Stakeholders say cream is being offered at lower multiples. Some butter makers are opting to use cream internally rather than selling loads. Cream multiples moved lower on both ends of the range.

     Western U.S., F.O.B. Cream
     Price Range - All Classes; $/LB Butterfat:   3.0203 - 3.7395
     Multiples Range - All Classes:               1.0500 - 1.3000
     Price Range - Class II; $/LB Butterfat:      3.4230 - 3.7395 

     Multiples Range - Class II:                  1.1900 - 1.3000