MILK
After spot trading, Class III milk futures gained momentum with December moving to $21.05 for a brief period of time. All contracts closed above $20.00 through November 2023. This movement was not anticipated a week ago, but the psychology and emphasis of the market can change quickly. It would not be a surprise to see that market drop back sharply once buying has run its course. Business is being done for the holidays, but buyers are not purchasing to build inventory. The increase of milk production is increasing cheese production and leaves sufficient milk supply for both bottlers and manufacturers. The trend of higher milk production is not expected to change course anytime soon. Dairy farmers are pushing production as they always do having compensated for higher cost of production. Feed is readily available as harvest winds down. Feed prices are higher due to trucking and rail costs, but it is moving to those areas that need it. Cow comfort has improved allowing for increased milk production. USDA will release the World Agricultural Supply and Demand report tomorrow providing estimated milk production, milk prices, and product price for this year and next year.
AVERAGE CLASS III PRICES
| 3 Month: | $20.67 |
| 6 Month: | $20.41 |
| 9 Month: | $20.35 |
| 12 Month: | $20.31 |
CHEESE
Cheese demand is variable. Some plants indicate it is a bit more difficult to find buyers for cheese while others indicate they are having a difficult time keeping up with current orders and are having to limit new orders being placed. This is variety-specific and location-specific. Demand has been good with retail orders showing signs of slowing. The high cost of food is having and will continue to have an impact on the purchasing habits of consumers.
BUTTER
Price has seen substantial volatility over the past week with likely more to come as the market tries to find a level at which business will be done reasonably. There is concern over price moving forward. Today was the second time that the closest bid was way down at $1.99. Last week, it took place during trading and was only seen for a short period of time but was recorded as an unfilled bid at the close of the day. Today, it was an unfilled bid remaining at the close with no other unfilled bids above it. The fact that it is even placed as an order during the day makes one wonder how far this market could decline. Butter futures show prices down at $2.48 next year.
OUTSIDE MARKETS SUMMARY
December corn declined 8.25 cents closing at $6.6750. November soybeans gained 4 cents closing at $14.44 with December soybean meal up $0.30 ending at $419.30 per ton. December wheat declined 18 cents closing at $8.2775. December live cattle closed unchanged at $153.05. December crude oil fell $2.88 ending at $88.91 per barrel. The Dow gained 334 points closing at 33,161 while the Nasdaq gained 52 points closing at 10,616.
