MILK
Class III futures were higher prior to spot trading but even though cheese increased, futures could not hold the highs backing down somewhat into the close. Traders are cautious over the ability of cheese prices to hold or increase through the end of the year and are hesitant to buy into the rally very aggressively. At some point, futures will need to adjust if underlying cash remains supported. South Dairy Trade results were posted today which show the volume and prices of dairy products moved through ports in Argentina and Uruguay over a 2-week period. Argentina had 11,585.71 tons of dairy products moving to 22 destinations at an average price of $4,022.72 per ton during the period from November 1 through November 15. The average price for whole milk powder was $3,759.49 per ton or $1.71 per pound, down 1.7% from the previous period. Skim milk powder increased 4.6% to $3,704.57 per ton or $1.68 per pound. Semi-hard cheese decreased 0.9% to $4,630.62 per ton or $2.10 per pound. Hard cheese decreased 3.8% to $6,339.45 per ton or $2.88 per pound. Butter decreased 0.3% to $4,777.10 per ton or $2.17 per pound. Buttermilk price was unchanged at $3,100 per ton or $1.41 per pound. Dairy products moving through ports in Uruguay totaled 8,581.60 tons to 26 destinations at an average price of $3,929.95 per ton during the period of December 1 through December 15. Whole milk powder price decreased 0.5% to $3,735.58 per ton or $1.70 per pound. Skim milk powder increased 1.9% to $3,792.55 per ton or $1.72 per pound. Semi-hard cheese increased 1.1% to $5,030.68 per ton or $2.28 per pound. Hard cheese decreased 0.6% to $6,683.28 or $3.03 per pound. Butter price decreased 3.3% to $5,216.17 per ton or $2.37 per pound.
AVERAGE CLASS III PRICES
| 3 Month: | $19.72 |
| 6 Month: | $19.37 |
| 9 Month: | $19.51 |
| 12 Month: | $19.67 |
CHEESE
Cheese has shown unexpected price strength over the past week. It is unlikely it will continue higher as more cheese will be available to the market due to heavier cheese production over the holidays and slowing demand. Buyers are not very interested in purchasing ahead for first quarter demand as there is uncertainty over what that demand may be. Much of the buying is hand-to-mouth which does indicate that demand seems to be holding well for now.
BUTTER
Price may not be very volatile this week as had been anticipated. Buyers and sellers may coast through the end of the year doing business as required. However, sellers may remain more aggressive as they might want to reduce inventory by the end of the year. World butter prices have been declining in various countries as demand has not been as strong as it had been. This may reduce exports over the next few months.
OUTSIDE MARKETS SUMMARY
March corn gained 8.50 cents closing at $6.7475. January soybeans gained 3.25 cents closing at $14.8225 with January soybean meal down $3.50 per ton closing at $451.80. March wheat declined 1.50 cents closing at $7.7450. December cattle declined $0.07 ending at $1.56.82. February crude oil slipped $0.03 per barrel closing at $79.53. the Dow gained 38 points closing at 33,242 while the Nasdaq declined 145 points closing at 10,353.
