MILK
Class III milk futures drifted higher even though the increase of block cheese and the decrease of barrel cheese prices offset each other due to the weighting factor being heavier to barrels. Futures are expected to be choppy as cheese prices will fluctuate. The Global Dairy Trade auction trade weighted average increased 0.6% on today's event. There were 158 bidders with a total of 29,570 metric tons sold. Anhydrous milk fat price increased 1.8% to $5,797 per metric ton or $2.63 per pound. Butter decreased 1.9% to $4,725 per metric ton or $2.14 per pound. Buttermilk powder increased 4.7% to $2,979 per metric ton or $1.35 per pound. Cheddar cheese price increased 1.8% to $4,826 per metric ton or $2.19 per pound. Lactose decreased 0.8% to $1,222 per metric ton or $0.55 per pound. Skim milk powder increased 1.7% to $3,102 per metric ton or $1.41 per pound. Whole milk powder gained 0.1% to $3,400 per metric ton or $1.54 per pound. Butter price in the U.S. is much higher than world price which may impact exports.
AVERAGE CLASS III PRICES
| 3 Month: | $20.08 |
| 6 Month: | $20.05 |
| 9 Month: | $20.13 |
| 12 Month: | $20.19 |
CHEESE
There is no real trend for cheese which keeps Class III milk futures choppy. Currently, there seems to be support under the market which is keeping most milk futures above $20.00. With holiday orders being filled and generally fill-in buying being most of what is taking place, the market may have limited upside potential. However, with the market being somewhat balanced, prices may continue to move sideways.
BUTTER
Butter price is far above world price which may have an impact on exports as time progresses. Right now, there is good support under the market with demand holding well. Holiday demand will be over soon leading to regular demand. Churns are active with the intent of building inventory over time. However, the year will end with inventory quite a bit below the previous year which should support price. Maybe not at this level, but historically high.
OUTSIDE MARKETS SUMMARY
December corn declined 3.25 cents closing at $6.2550. January soybeans gained 17.25 cents closing at $14.55 with December soybean meal up $17.20 per ton closing at $449.20. December wheat lost 10 cents ending at $7.0550. December live cattle lost $1.67 closing at $151.55. January crude oil fell $2.68 closing at $74.25 per barrel. The Dow fell 351 points closing at 33,596 while the Nasdaq lost 225 points closing at 11,015.
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