MILK
The pressure really came into Class IV futures with the biggest loss in butter in three weeks and nonfat dry milk falling again. Contracts fell as much as 52 cents with June showing the greatest loss. March, April, May, and June contacts are currently below Class III futures for those same months. It has been a long time since that has been the case. The Global Dairy Trade auction took place yesterday with the trade weighted average decreasing 0.1% from the previous event. There were 31,872 metric tons sold at an average price of $3,393 per metric ton. There 164 participating bidders. Anhydrous milk fat price declined 0.9% to $5,337 per metric ton or $2.41 per pound. Butter price declined 0.6% to $4,449 per metric ton or $2.20 per pound. Cheddar cheese gained 4.0% to $4,871 per metric ton or $2.21 per pound. Skim milk powder declined 0.3% to $2,842 per metric ton or $1.29 per pound. Whole milk powder gained 0.1% to $3,218 per metric ton or $1.46 per pound. Buttermilk powder and lactose prices were not posted due to no prices the previous event. Sweet whey powder was not offered at this event.
AVERAGE CLASS III PRICES
| 3 Month: | $18.68 |
| 6 Month: | $18.73 |
| 9 Month: | $19.02 |
| 12 Month: | $19.21 |
CHEESE
There are mixed signals coming from the industry. Some report a slowing of demand while others indicate orders have increased to some extent. This seems to be variety specific as cheddar and pizza cheeses seem to be in good demand. Cheese manufacturers have no shortage of milk with spot milk remaining as much as $10.00 below class making it the fourth consecutive week of spot milk prices this low.
BUTTER
Cream supply is readily available with many plants not having to rely on the spot market to purchase extra cream to manufacture. Churning is very active with reports that plants are putting butter into inventory for later demand. If churning continues at the present rate, increased demand later will not tighten supply with price potential limited due to more butter being available from inventory. However, butter supply is not termed as bearish as most would like butter supplies to increase to a more comfortable level.
Outside Markets Summary
March corn declined 4 cents closing at $6.8125. March soybeans declined 15.25 cents ending at $15.2425 with March soybean meal down $3.10 per ton closing at $478.10. March wheat declined 9.25 cents ending at $7.4250. February live cattle declined $0.20 closing at $156.80. February crude oil down $0.70 ending at $79.48 per barrel. The Dow fell 614 points closing at 33,297 while the Nasdaq declined 138 points closing at 10,957.
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