MILK
Aggressive selling did not erupt due to the weakness of cheese prices. The rebound in futures yesterday was positive but not enough to change market direction or even to change the overall attitude of traders. It did provide some hope that prices may find some support rather than continue to show weakness. March and April Class III futures remain below $19.00 with the rest of the contracts below $20.00 until October with that being the only contract above $20.00. The level of milk production will keep sufficient supply for bottling and manufacturing resulting in current needs being met and inventory of cheese beginning to increase. Weather continues to remain good for milk production in much of the country. California is dealing with a lot of rain which is causing some difficulties. It is uncertain how much impact that will have on milk output, but it is providing some much-needed water for the state. Class IV futures were steady to higher as there was no further pressure on nonfat dry milk.
AVERAGE CLASS III PRICES
| 3 Month: | $19.10 |
| 6 Month: | $19.12 |
| 9 Month: | $19.32 |
| 12 Month: | $19.45 |
CHEESE
Manufacturing plants are running busy schedules as milk receipts are strong. Those who have room for extra milk have been able to purchase at significantly discounted prices from the spot market. Manufacturing and bottling have not been overwhelmed with milk but has been sufficient to meet demand and rebuild inventory. Some slowing of demand will allow greater supply to be available for immediate needs as well as to rebuild aging programs. This may keep a limit on upside price potential for a time.
BUTTER
There is sufficient butter for all needs with no talk of any shortage as there had been during the fourth quarter of last year. More cream has been available to the market increasing churning activity. Price seems to have found support for the time being and maybe for the longer term. Export demand has been phenomenal with exports up 48% for the first 11 months of 2022. Nonfat dry milk has been the drag with spot price continuing to remain weak. Exports for the first 11 months of the year were down 7% along with slower domestic demand.
OUTSIDE MARKETS SUMMARY
March corn gained 2.25 cents closing at $6.55. January soybeans gained 6.50 cents closing at $15.10 with January soybean meal up $4.20 closing at $500.90 per ton. March wheat declined 10.50 cents ending at $7.31. February live cattle were unchanged at $157.75. February crude oil gained $0.49 ending at $75.12 per barrel. The Dow gained 186 points closing at 33,704 while the Nasdaq gained 107 points closing at 10,743.
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