Wednesday Closing Dairy Market Update - American Cheese and Butter Stocks Increase

MILK:

Milk futures set back today due to the weakness of blocks. Buyers just would not bid higher for cheese and decided to pull back and let sellers come to their price. Milk production is termed as steady to stronger leaving sufficient milk for all areas of the industry. Weather so far has been mild and conducive for strong milk output. Spring flush should be near its peak, but with current weather, it could remain at that level for an extended period of time. Some schools have closed for the summer while most of them will be closing over the next two weeks. This could have a negative impact on spot milk prices that have been unusually low for this time of year. It is uncertain whether culling has increased this month. We did not really see it in April, but another month of low milk prices may increase the need for farms to raise the bar on milk production resulting in an increased culling rate.

AVERAGE CLASS III PRICES:

3 Month:	$16.46
6 Month:	$18.35
9 Month:	$18.65
12 Month:	$18.05

CHEESE:

American cheese stocks increased 11.5 million pounds totaling 838.4 million pounds according to the April Cold Storage report released today. This is right in line with a year ago. Swiss cheese stocks decreased 21,000 pounds totaling 21.6 million pounds in April. This is 10% below a year ago. Other cheese stocks decreased 8.3 million pounds to a total of 603.7 million pounds which is 3% below a year ago. Total cheese inventory totaled 1.463 billion pounds, up 3.1 million pounds from March but down 17.4 million pounds from April 2022. This should be neutral to supportive for the market.

BUTTER:

Butter stocks in April totaled 327.7 million pounds, up 18.2 million pounds from March and up 10% from April 2022. Current butter supply is sufficient for demand with production ongoing leaving market participants unconcerned over supply. This leaves spot price entrenched in a sideways trading range.

OUTSIDE MARKETS SUMMARY:

July corn gained 10.25 cents closing at $5.8775. July soybeans gained 1.75 cents closing at $13.2425 with July soybean meal down $4.30 per ton closing at $402.10. July wheat fell 16.75 cents. June cattle gained $1.92 closing at $166.20. July crude oil declined $0.12 ending at $74.22 per barrel. The Dow declined 266 points ending at 32,790 while the Nasdaq lost 105 points closing at 12,455.