MILK
Without cheese prices turning higher today, milk futures needed to decrease in price to remain somewhat in line with underlying cash. So far this week, milk futures defied the weakness of cheese prices and moved higher. Today, milk futures took a breather. Class III futures were mostly lower. Class IV futures were steady to lower across the board. Front month April closed 10 cents higher as it adjusted to the weekly AMS prices. Spot milk in the Central region of the country continues to be offered from $4.00 to as much as $11.00 per cwt below class. The upper Midwest is experiencing the lower levels of spot milk prices as milk supply is plentiful. There is no concern over milk supply and spring flush is taking place. There has been some discussion as to what the impact of the large fire and the large loss of dairy cattle on the farm in Texas may have on the market. There is no way of telling what impact that may have on milk supply and milk prices. The news today did not impact the psychology of traders and did not impact the market. It certainly is devastating to have a loss of that magnitude for the farming operation as well as the community and all those involved with the dairy.
AVERAGE CLASS III PRICES
| 3 Month: | $18.27 |
| 6 Month: | $18.72 |
| 9 Month: | $18.98 |
| 12 Month: | $18.93 |
CHEESE
Barrel cheese has not found a bottom with further weakness today. However, the spot trading action may give indication of price being low enough to generate greater buying interest. Spot barrel price bounced off the low but still closed lower. However, there were quite a few unfilled bids below the market at the close of spot trading. Overall cheese demand is considered good, but price weakness leaves buyers with a wait-n-see attitude. Demand will need to improve and milk production will need to slow to have the market establish a long-term trend higher.
BUTTER
Price fell back again today keeping the market in a sideways range. It may be quite some time before price will be able to break out of the range. Even a breakout or a trend higher may be limited as supply is sufficient and inventory increasing. World butter prices are also lower and will impact international demand for U.S. butter.
OUTSIDE MARKETS SUMMARY
May corn declined 3.75 cents closing at $6.5225. May soybeans declined 3.25 cents closing at $15.01 with May soybean meal up $3.40 per ton closing at $463.60. May wheat declined 12.50 ending at $6.67. April live cattle gained $1.22 closing at $175.50. May crude oil fell $1.10 ending at $82.16 per barrel. The Dow gained 383 points closing at 34,030 while the Nasdaq gained 237 points closing at 12,166.
