MILK
Class III milk prices remain mixed Tuesday following light to moderate pressure in nearby contracts while deferred contract months bounced higher in limited but supportive trade. October Class III milk prices fell 13 cents per cwt, to $16.88, by the end of the trading session. Given September contracts quickly moving toward settlement, all eyes are on the October contracts.
December through October 2024 contracts months found some underlying buyer support through the last half of the session with prices moving 1 cents to 11 cents per cwt higher.
Overall, the dairy trade remained extremely quiet, focusing on unchanged cash cheese price levels and light volume in a higher butter market. Firm gains were seen in Class IV milk contracts as October futures posted a 26 cent per cwt gain, but the overall volume in these markets remains very light and limited.
Outside markets seemed to play a significant role in overall dairy market activity throughout the day with financial markets trading more than 500 points lower through part of the day and significant triple-digit losses also held the NASDAQ under pressure. Many traders are not in a hurry to secure product or long-term positions and seemed very willing to remain on the sidelines through most of the Tuesday session.
AVERAGE CLASS III PRICES
| 3 Month: | $17.50 |
| 6 Month: | $17.69 |
| 9 Month: | $17.90 |
| 12 Month: | $18.04 |
CHEESE
Cheddar cheese prices are unchanged Tuesday on the CME exchange with no trades seen in either barrel or block cheese markets. Block cheese prices remain at $1.72 per pound while barrel prices continue to hold the early week price discount at $1.5425 per pound. Cheddar prices fell 4.8% on the Global Dairy Trade compared to last week.
The outside market pressure, especially in financial markets Tuesday, seemed to have limited the overall direction and activity of traders in the dairy complex. Overall trade volumes are still expected to increase by the end of the week, although it is uncertain if a price direction will develop over the short term as price levels could bounce around in a narrow but well-defined trading range over the near future.
BUTTER
Cash butter closed 8 cents per pound higher in light and delayed light market trade Tuesday morning with prices moving to $3.42 per pound following one load of butter trading on the exchange and three additional bids going uncovered. Trade on the Global Dairy trade posted price increases of 4.4% for all products and butter prices specifically increased 1.3% from last week's price levels.
The strong uptick in price levels during early October may indicate additional buyer support developing ahead of the holiday and fourth-quarter demand surge, but the volatility in other markets will have to be closely watched as one day of trade is far from creating a reliable pattern.
OUTSIDE MARKETS SUMMARY
December corn closed down 1.25 cents per bushel at $487.50; November soybeans closed down 4.25 cents at $12.72.75; and December soybean meal closed down $2.60 per ton at $371.70. December Chicago wheat closed up 3.75 cents at $5.6850. December live cattle closed down $2.70 at $185.65. November crude oil is up $0.66 per barrel at $89.50. The Dow Jones Industrial Average is down 430 points at 33,002 with the NASDAQ is down 248 points at 13,059.
