MILK
Class III milk futures came to life today as traders just could not ignore the turnaround of barrel cheese price. The bearish anticipation that the weakness of barrels could have a negative impact on blocks was quickly put to rest as buyers were aggressively looking to purchase barrels only to find no willing sellers. This is what the market needed to light a fire under traders. The September contract set the highest close since May 16. All Class III contracts are now above $18.00 through February 2025. Although this is noteworthy, it is still a far cry from profitable prices. If culling remains heavy and both international and domestic demand improves, prices may be able to reach near $20.00 at some point this year. The strong trend higher of cheese prices may slow to some extent and there will be price retracements, but it seems like prices will be supported overall.
AVERAGE CLASS III PRICES
| 3 Month: | $17.92 |
| 6 Month: | $18.04 |
| 9 Month: | $18.08 |
| 12 Month: | $18.16 |
CHEESE
For the week, blocks increased 3.75 cents with four loads traded. Barrels decreased 1.75 cents with four loads traded. The trading activity for both blocks and barrels mirrored what it was last week. Block price continues to slowly advance as buyers are purchasing for upcoming demand in a balanced market. Decreased milk production and more milk moving to bottling leaves less available for cheese production. However, supply remains sufficient for demand, keeping plants running on generally full schedules. Dry whey price remained unchanged for the week with 16 loads traded.
BUTTER
For the week, butter increased a penny with 98 loads traded. It certainly was positive to see that much activity and yet price was able to close higher. Churning is slowing which may have prompted buyers to be a bit more aggressive to purchase ahead rather than purchase as needed in hopes that price could retrace before moving higher. There remains concern over exports due to lower world prices and reduced international demand. Grade A nonfat dry milk decreased 0.50 cent for the week with 12 loads traded.
OUTSIDE MARKETS SUMMARY
December corn closed up 7.25 cents per bushel at $4.9300, November soybeans closed up 23.25 cents at $13.5325 and December soybean meal closed up $8.30 per ton at $389.00. December Chicago wheat closed up 23.75 cents at $6.3900. October live cattle closed up $0.50 at $178.83. September crude oil is up $0.86 per barrel at $81.25. The Dow Jones Industrial Average is up 26 points at 34,501 with the NASDAQ down 26 points at 13,291.
