MILK
Traders focused more on the increase of block cheese rather than the weakness of barrels moving Class III price higher into the close compared to where they had been during spot trading. The spot price of block cheese moved higher on an unfilled bid with no interest from sellers. This moved April Class III futures above $18.00 again. USDA released the World Agricultural Supply and Demand report today showing their estimate for milk production this year to total 228.3 billion pounds. This is a reduction of 900 million pounds from their January estimate. This would be 1.7 billion pounds above the level of milk production in 2022. They adjusted milk prices significantly. The average Class III price was lowered $0.95 to $17.90. The average Class IV price was lowered $1.00 from January to an estimate of $18.25. The All-milk price was lowered to $20.70. a decrease of $0.90.
AVERAGE CLASS III PRICES
| 3 Month: | $17.81 |
| 6 Month: | $18.34 |
| 9 Month: | $18.83 |
| 12 Month: | $19.01 |
CHEESE
Traders were more focused on the increase of blocks rather than the weakness of barrels. This moved Class III milk futures higher. USDA was not very friendly with their estimate for the average cheese price for the year. They estimate cheese to be $1.86, down 7 cents from the January estimate. Dry whey price was reduced to 36.50 cents, a decrease of 5 cents from their previous estimate. This certainly is not a positive outlook for the market as the current cheese price is currently near that level and dry whey is above that level. Not much upside is anticipated.
BUTTER
The estimated average butter price for the year was left unchanged at $2.33 and if realized would be 53 cents below the average for 2022. Nonfat dry milk was estimated substantially lower than the previous month. USDA estimates nonfat dry milk to average 1.2250, down 11.50 cents from the January estimate.
Outside Markets Summary
March corn gained 4.50 cents closing at $6.7850. March soybeans gained 4.50 cents closing at $15.1975 with March soybean meal up $0.50 closing at $481.90. March wheat jumped 15 cents closing at $7.6475. February live cattle gained $0.22 ending at $160.80. March crude oil gained $1.33 per barrel closing at $78.47. The Dow dropped 208 points closing at 33,949 while the Nasdaq declined 203 points closing at 11,911.
