Friday Morning Dairy Market Update - Price Movement May Be Limited

OPENING CALLS:

Class III Milk Futures:	Mixed
Class IV Milk Futures:	Mixed
Butter Futures:	Mixed

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	Steady to 1 Lower
Soybean Futures:	Steady to 2 Lower
Soybean Meal Futures:	$1 to $2 Lower
Wheat Futures:	1 to 3 Higher

MILK:

Milk futures show little price direction. Underlying cash cheese and dry whey are not providing any consistent support with price remaining choppy. The pattern of limited upside price movement remains intact. Class IV futures have shown limited movement all week even though butter price has increased. Traders remain cautious over continued upside potential. Trading activity is expected to decrease significantly after spot trading as traders will close out their activity for the year. Fundamentals are not expected to change as the market moves into 2024. Much of the same activity is expected as the milk supply is sufficient for demand. USDA will release the November Agricultural Prices report Friday afternoon. This will provide prices used in the calculation of the income over feed for the Dairy Margin Coverage program. The average soybean meal price used in the calculation may not be released Friday unless FSA makes a special effort to release the price ahead of the new year. Generally, they release the price the day after the report.

CHEESE:

Barrel cheese price could go either way Friday, depending on how aggressive buyers will be. The large number of unfilled bids did not indicate buyers were turning more aggressive, but showed they are willing buyers at the current price level. This may put a floor in the market, but not necessarily higher prices.

BUTTER:

Price has moved back near their previous high since early December. However, it may have a difficult time trending higher as butter production is strong and manufacturers want to limit inventory build. Retain demand is termed as steady.

Thursday Midday Dairy Market Summary - Barrels Drop Back

OUTSIDE MARKETS SUMMARY:

CORN:	2 Lower
SOYBEANS:	12 Lower
SOYBEAN MEAL:	$7.60 Lower
LIVE CATTLE:	$0.40 Higher
DOW JONES:	72 Points Higher
NASDAQ:	21 Points Higher
CRUDE OIL:	$1.86 Lower

MIDDAY MARKET UPDATE:

Block cheese price increased 1.50 cents, closing at $1.43 with six loads traded. Barrel cheese price declined 4 cents, closing at $1.43 with 14 loads traded. What is interesting in that there remained 19 unfilled bids for barrels at the close of spot trading. This was the same amount as Wednesday and yet there were 14 loads traded today. Dry whey price remained steady at 38.50 cents with no loads traded. Class III futures are 29 cents lower to 5 cents higher. Butter price increased 3.75 cents, closing at $2.66 with two loads traded. Grade A nonfat dry milk price remained unchanged at $1.1650 with no loads traded. Class IV futures are 8 cents lower to 15 cents higher. Dry whey futures are unchanged to 0.20 cent lower.

Fluid Milk and Cream - Western U.S. Report 52

Farm level milk outputs are steady to higher in the West. Milk production continues to grow week over week in California. Contacts share farm level milk outputs are lower than they were in December 2022, but that components are stronger than in prior years. Cream supplies are abundant, and flat multiples are becoming more common. Some butter plant managers relay churns are not full, and they are seeing above flat market multiples to bring cream in from areas with heavy cream supplies. Class I demand is down from recent weeks as a result of school closures. 

Milk outputs in Washington and Oregon are trending higher. Cool temperatures have boded well for cow comfort. Class I demand is weaker than in recent weeks. Class II, III, and IV demands are also lighter. 

Milk production is steady in both Arizona and New Mexico. Class I demand has waned as a result of school closures, but milk volumes have been redirected into other channels to meet local processing needs. 

Milk outputs in Idaho, Utah, and Colorado are steady at the farm level. Contacts share week over week increases in milk production in Idaho have flattened somewhat. Class I demand is lighter throughout the mountain states. Demands for all other Classes are steady to lighter. 

Contacts share cream supplies are strong in certain areas of the region, and multiples have moved lower at the top end of the all Classes range in response.

Thursday Morning Dairy Market Update - Cash Prices May Remain Choppy

OPENING CALLS:

Class III Milk Futures:	Mixed
Class IV Milk Futures:	2 to 4 Higher
Butter Futures:	Steady to 1 Higher

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	Steady to 1 Lower
Soybean Futures:	Steady to 2 Lower
Soybean Meal Futures:	Steady to $1 Lower
Wheat Futures:	Steady to 2 Higher

MILK:

It will be interesting to see if underlying cash prices will again increase Thursday. The number of unfilled bids for barrels has been surprising and supportive to the market. Yet, traders are cautious as the pattern of limited upside potential has been prevalent for quite some time. The market is heading into a time when demand is generally slower and inventory builds. Milk supply is plentiful with spot milk prices declining. For the most part, the weather remains good for milk production which continues to slowly improve. Cows are moving from one operation to another as some that exit the business are being absorbed by another that is expanding or has room in the current facilities.

CHEESE:

The amount of buying interest over the past week for barrels has been a surprise. Demand generally slows over the next few months, but there is strong interest in buying. However, buyers are not very aggressive with most of the bids below the market. There is hope manufacturers will want to move product rather than hold onto it, which may put pressure on prices.

BUTTER:

Price is expected to chop around in a range as supply and demand is sorted out. Supply is expected to end the year higher than it was a year ago. It will be up to demand to determine price strength. International demand is depressed with no indication of a change in the near term. Price may slip back again today after the increase Wednesday.

Wednesday Closing Dairy Market Update - Spot Milk Price Declines

MILK

Milk futures were higher across the board Wednesday in both classes of milk. Underlying spot prices were stronger in all categories, causing buying interest. However, the gains of the past two days in underlying cash have been met with limited upside price movement. Traders remain concerned about upside price potential.

South dairy trade numbers were released for prices of dairy products moving through ports in Argentina and Uruguay over a two-week period. Dairy products moving through ports in Argentina during Nov. 1-15 totaled 15,157.99 tons to 30 destinations.

Whole milk powder price increased 1% from the previous period at $3,209.11 per ton or $1.46 per pound. Skim milk powder decreased 1.2% to $3,013.82 per ton or $1.37 per pound. Semi-hard cheese decreased 2.8% to $3,973.54 per ton or $1.80 per pound. Hard cheese gained 2.5% to $6,031.31 per ton or $2.74 per pound. Butter decreased 0.9% to $4,189.98 per pound or $1.90 per pound. Dairy products moving through ports in Uruguay from Dec. 1-15 totaled 8,876.70 tons to 36 destinations.

Whole milk powder price increased 3.8% from the previous period, totaling $3,228.23 per ton or $1.46 per pound. Skim milk powder decreased 7.5% to $3,113.23 per ton or $1.41 per pound. Semi-hard cheese decreased 10.23% to $4,328.23 per ton or $1.96 per pound. Hard cheese increased 2.9% to $6,231.74 per ton or $2.83 per pound. Butter decreased 5.2% to $4,624.02 per ton or $2.10 per pound.

AVERAGE CLASS III PRICES

3 Month:	$15.90
6 Month:	$16.57
9 Month:	$17.17
12 Month:	$17.54

CHEESE

Spot milk prices have decreased significantly over the past weeks with prices now ranging from $2 to $8 below class. Some plants are running lighter production schedules which have put more milk out to the spot market. This weakness is not expected to last very long once the holiday period has passed. Some plants report a seasonal decrease in demand which makes it surprising that cheese buyers have been active during spot trading. There is anticipation there will be some inventory build moving forward.

BUTTER

Cream supplies are abundant, which leaves plentiful supply available for churning. Many plants are running at capacity and having to turn some cream away that is being offered to them. Butter price is holding well for the last week of the year even though inventory is growing. Some purchasing is being made for orders for the first quarter of 2024.

OUTSIDE MARKETS SUMMARY

March corn closed down 3.75 cents per bushel at $4.7650, March soybeans closed up 1.50 cents at $13.2050 and March soybean meal closed down $2.10 per ton at $393.80. March Chicago wheat closed down 13.25 cents at $6.2300. February live cattle closed down $1.13 at $169.28. February crude oil is down $1.74 per barrel at $73.83. The Dow Jones Industrial Average is up 111 points at 37,657 with the NASDAQ is up 25 points at 15,099.

Wednesday Midday Dairy Market Summary - Spot Prices Increase in All Categories

OUTSIDE MARKETS SUMMARY:

CORN:	4 Lower
SOYBEANS:	1 Higher
SOYBEAN MEAL:	$3.30 Lower
LIVE CATTLE:	$0.02 Lower
DOW JONES:	104 Points Higher
NASDAQ:	36 Points Higher
CRUDE OIL:	$1.21 Lower

MIDDAY MARKET UPDATE:

Block cheese price increased 2.50 cents, closing at $1.4150 with seven loads traded. There were five unfilled bids remaining at the close. Barrel cheese price gained 4.50 cents, closing at $1.47 with eight loads traded. There were 19 unfilled bids remaining at the close with one uncovered offer. It seems buyers are more interested in purchasing as the end of the year approaches. Dry whey price increased 0.50 cent, closing at 38.50 cents with one load traded. Class III futures are 2-16 cents higher with January and February showing the greatest gains. Butter price increased 8 cents, closing at $2.6225 with no loads traded. There were two unfilled bids remaining with no uncovered offers. Manufactures are holding back seeing no need to be aggressive sellers. Grade A nonfat dry milk price gained 0.50 cent, closing at $1.1650 with no loads traded. Class IV futures are 8-18 cents higher. Butter futures are 0.20 -- 3.20 cents higher. Dry whey futures are 0.05 cent lower to 0.47 cent higher.

Wednesday Morning Dairy Market Update - Traders May Anticipate Higher Cash

OPENING CALLS:

Class III Milk Futures:	Steady to 5 Higher
Class IV Milk Futures:	Mixed
Butter Futures:	Mixed

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	1 to 2 Lower
Soybean Futures:	5 to 7 Lower
Soybean Meal Futures:	$1 to $2 Lower
Wheat Futures:	6 to 8 Lower

MILK:

Traders may hold some optimism over the potential for further upside in futures Wednesday. The number of unfilled bids for barrels remaining at the close of spot trading Tuesday, with price moving higher, may increase the buying interest in barrels during spot trading. However, underlying cash is expected to remain choppy. There is some anticipation that milk production may tighten early next year as low milk prices will take a toll. This would be the normal reaction to low prices, but that reaction may be slower to develop this time as farms push milk production to maintain cash flow rather than cull cows heavily. Demand will be the key to better milk prices.

CHEESE:

It will be interesting to see if buyers of barrel cheese will be more aggressive Wednesday or if they will just hold lower bids in the hopes that sellers will want to move supply before the end of the year. The inability of blocks to hold gains Tuesday may keep upside price potential limited. More milk continues to move to manufacturing as schools remain closed.

BUTTER:

It is uncertain whether butter price will see much strength this week or even early next year. Higher inventory and active churning leaves sufficient supply for demand. Price may move into a similar sideways pattern to last year as supply and demand remain balanced.

Tuesday Closing Dairy Market Update - Milk Futures Hold Minor Gains

MILK

The volatility of milk futures was not very great today, but trading volume was higher than usual. The volume in January was nearly 900 contracts with February over 750 contracts. There certainly was no limited trading due to the holiday season. The markets are not like they once were before electronic trading as orders can be placed from anywhere at any time. The proverbial slower trading is not as issue as it once was.

We have not seen any significant change in fundamentals in the dairy industry over the past few weeks. Grain prices show limited volatility with corn and soybean meal in a downtrend. Less expensive feed prices will keep milk production strong as farmers balance rations for optimal milk production.

AVERAGE CLASS III PRICES

3 Month:	$15.71
6 Month:	$16.41
9 Month:	$17.04
12 Month:	$17.39

CHEESE

The volume of unfilled bids for barrels remaining at the close of trading for the past few days has been interesting. It has not resulted in buyers being very aggressive but seems to indicate price may be at a level at which buyers are interested in purchasing rather than holding back. This does not necessarily indicate a bottom has been established and that prices will trend higher, but it may indicate the downside is limited. The inability of blocks to hold the initial higher price during spot trading does not provide much support.

BUTTER

With inventory in November being 8% above a year ago, it indicates the year will close with a significantly higher supply. The current production of butter has increased due to more cream being available which may leave buyers comfortable with supply and willing to continue to purchase on an as-needed basis.

OUTSIDE MARKETS SUMMARY

March corn closed up 7.25 cents per bushel at $4.8025, March soybeans closed up 12.75 cents at $13.1900 and March soybean meal closed up $4.80 per ton at $395.90. March Chicago wheat closed up 20 cents at $6.3625. February live cattle closed up $1.88 at $170.40. February crude oil is up $1.64 per barrel at $75.20. The Dow Jones Industrial Average is up 159 points at 37,545 with the NASDAQ is up 82 points at 15,075.

Tuesday Midday Dairy Market Summary - Barrel Cheese Rebounds

OUTSIDE MARKETS SUMMARY:

CORN:	6 Higher
SOYBEANS:	11 Higher
SOYBEAN MEAL:	$2.70 Higher
LIVE CATTLE:	$0.65 Higher
DOW JONES:	147 Points Higher
NASDAQ:	64 Points Higher
CRUDE OIL:	$2.36 Higher

MIDDAY MARKET UPDATE:

Block cheese price initially increased a penny before selling pressure moved price back to unchanged at $1.39. There were 14 loads traded as buyers were interested in purchasing what was being offered. Barrel cheese price increased 3.25 cents closing at $1.4350 with 8 loads traded. There were 2 unfilled bids for blocks and one uncovered offer. Barrels were in greater demand as there were 14 unfilled bids remaining at the close. There have been quite a large number of unfilled bids over the past few days but little in the way of upward price movement. It will be interesting to see how aggressive buyers will be through the end of the year.

Dry whey price remained unchanged at 38 cents with no loads traded. Class III futures are unchanged to 19 cents higher. Butter price increased 0.25 cent closing at $2.5425 with no loads traded. Grade A nonfat dry milk price remained steady at $1.16 with one load traded. Class IV futures are 7 cents lower to 9 cents higher. Butter futures are 1.22 cents lower to $2.77 cents higher. Dry whey futures have not yet traded today.

Tuesday Morning Dairy Market Update - Limited Activity Ahead of Cash

OPENING CALLS:

Class III Milk Futures:	Mixed
Class IV Milk Futures:	Mixed
Butter Futures:	Mixed

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	1 to 2 Higher
Soybean Futures:	Mixed
Soybean Meal Futures:	Mixed
Wheat Futures:	1 to 2 Lower

MILK:

There is not much expectation for a change in the market any time soon. This week may not see much movement of futures as the end of the year is near. Traders will square-up their positions to close out the books. Manufacturers may want to further reduce their inventory to close out the year. The weather in many areas of the country is mild and beneficial for cow comfort and milk production. Milk output continues to slowly improve from week to week but continues to remain below a year ago. There is little to generate excitement from traders. Milk futures are expected to remain choppy.

CHEESE:

There is concern cheese prices may retest the lows possible even before the end of the year. There have been quite a few unfilled bids during spot trading, but those unfilled bids have all been below the market. Maybe this will provide some support but may not result in higher prices.

BUTTER:

The weakness of butter Friday may keep buyers on the sidelines Tuesday or possibly this week. Buyers do not want to add to inventory with manufacturers wanting to reduce inventory. The November Cold Storage report showed butter stocks 8% above a year ago, which may keep pressure on price.

Friday Closing Dairy Market Update - Cold Storage Neutral for Cheese, Bearish for Butter

MILK

Class III milk futures fell for much of the week as cheese prices were unable to find a bottom. Prices have not been able to benefit from a time of year when generally there is a bump in prices as demand is higher. However, sufficient supply and less-than-stellar demand have left the market struggling as buyers have not needed to be aggressive. There has been sufficient supply for demand, which left the market with little reason for concern. Manufacturers wanted to move product as soon as it was produced rather than hold it in inventory and pay for storage. They saw little benefit to holding onto supply for a higher price that was likely not going to develop through the end of the year and possibly a while into next year.

Class IV price will continue to outperform Class III and looks to potentially continue throughout 2024. Dairy markets will be closed Monday in observance of Christmas but will reopen that evening at the usual time.

AVERAGE CLASS III PRICES

3 Month:	$15.71
6 Month:	$16.41
9 Month:	$17.04
12 Month:	$17.39

CHEESE

For the week, blocks fell 13 cents with 30 loads traded. Barrels declined 5.75 cents with 62 loads traded. Dry whey declined 1.50 cents with 11 loads traded. Business increased during the week as manufacturers wanted to manage inventory through the end of the year. USDA released the November Cold Storage report which was neutral for cheese. American cheese inventory declined 8.1 million pounds from October, totaling 825.8 million pounds and was 1% above a year earlier. Swiss cheese inventory increased 110,000 pounds from the previous month, totaling 20.9 million pounds but was down 7% from a year ago. Other cheese inventory declined 16.9 million pounds from the previous month to a total of 587.0 million pounds and was 1% below a year ago. Total cheese inventory was 1.434 billion pounds, down 25.0 million pounds from October and steady from a year ago.

BUTTER

For the week, butter gained 6 cents with 13 loads traded. Grade A nonfat dry milk was unchanged for the week with 10 loads traded. Butter inventory in November declined 24.7 million pounds and a 10% decline from October. However, inventory was 8% above a year ago, which is negative and may result in a lower price over the next few weeks.

OUTSIDE MARKETS SUMMARY

March corn closed up .50 cent per bushel at $4.7300, March soybeans closed up 4.50 cents at $13.0625 and March soybean meal closed up $4.70 per ton at $391.10. March Chicago wheat closed up 3.75 cents at $6.1625. February live cattle closed down $0.15 at $168.53. February crude oil is down $0.33 per barrel at $73.56. The Dow Jones Industrial Average is down 18 points at 37,386 with the NASDAQ is up 29 points at 14,993.

Friday Midday Dairy Market Summary - Butter Falls Back

OUTSIDE MARKETS SUMMARY:

CORN:	1 Higher
SOYBEANS:	4 Higher
SOYBEAN MEAL:	$5 Higher
LIVE CATTLE:	$0.35 Lower
DOW JONES:	34 Points Higher
NASDAQ:	60 Points Higher
CRUDE OIL:	$0.08 Higher

MIDDAY MARKET UPDATE:

Block cheese price slipped 0.50 cent, closing at $1.39 with five loads traded. Barrel cheese price increased 0.25 cent, closing at $1.3925 with nine loads traded. There were six unfilled bids for blocks and 14 unfilled bids for barrels at the close.

This is interesting as there is interest in buying, but not aggressively. Buyers are waiting for sellers to offer supply at steady to lower prices.

Dry whey price increased 0.75 cent, closing at 38 cents with no loads traded. Class III futures are 24 cents lower to 3 cents higher. The December 2024 contract is hit the hardest. Butter price fell 6 cents, closing at $2.54 with two loads traded. There were two unfilled bids remaining at the close. Grade A nonfat dry milk price increased 0.50 cent, closing at $1.16 with one load traded. Class IV futures have not yet traded. Butter futures are 1.22 cents lower to 0.47 cent higher. Dry whey futures are 0.25 cent lower to 1 cent higher. USDA will release the November Cold Storage report this afternoon.

Friday Morning Dairy Market Update - Markets Expected to Drift

OPENING CALLS:

Class III Milk Futures:	Mixed
Class IV Milk Futures:	Mixed
Butter Futures:	Mixed

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	Mixed
Soybean Futures:	1 to 2 Higher
Soybean Meal Futures:	Steady to $1 Higher
Wheat Futures:	Steady to 1 Higher

MILK:

There is nothing exciting taking place in the dairy markets at the present time. Traders remain bearish on milk futures are underlying cash fails to provide support. Any hope for an increase in demand through the end of the year was dashed some weeks ago. The outlook for early next year is not very positive at the present time. Although spot milk prices are much better than a year ago, milk prices are worse than a year ago as both domestic and international demand continues to underperform. Dairy cattle slaughter in November was the lowest monthly slaughter since May 2021 and the lowest November slaughter since 2020. Cows are not being culled as readily as they had been in 2021 as the current herds mostly have higher producing cows that farmers want to keep.

CHEESE:

Price may revisit the lows seen in late June before the selling runs its course. The market is trying to find a level at which demand will improve and supply will decrease. USDA will release the November Cold Storage report Friday, which will provide an indication of demand for the month. Stocks are expected to be near last year's levels.

BUTTER:

The slight weakness of butter may send buyers to the sidelines in anticipation of lower prices through the end of the year. Churning has increased due to more cream being available. This will provide more supply during a lower demand period.

Thursday Closing Dairy Market Update - Cattle Slaughter Declines

MILK

One must wonder when the selling pressure will end. January through March Class III futures continue to make new lows following the weakness of cheese. Manufacturers intend to limit inventory through the end of the year and are selling what they produce at whatever price they can get.

It is not a factor of the milk supply being over-abundant but the fact that demand is not as great as it should be, and manufacturers are attempting to keep inventories from increasing. What may prolong this downturn in prices might be that there seems to be several expansions taking place from internal growth or from cows being moved from one farm to another.

The November Livestock Slaughter Report showed dairy cattle slaughter for the month below October and below November 2024. Dairy cattle slaughter totaled 229,700 head, down 13,200 head from October and down 21,200 head from November 2022. These numbers do not seem to be reflective of the decrease in cow numbers in the milk production report. It does show that farms are retaining cattle or cattle are moving to other facilities rather than being culled.

AVERAGE CLASS III PRICES

3 Month:	$15.68
6 Month:	$16.40
9 Month:	$17.04
12 Month:	$17.44

CHEESE

Cheese production has increased as more milk has moved to manufacturing as bottlers divert milk from school accounts. Increasing cheese production leaves plants with more product to move to the market as they want to limit inventory growth. Spot milk prices are so far much better than last year with prices ranging from $5 below class with some reports of spot milk still $0.25 above class. Last year at this time, spot milk was running upwards of $10 below class.

BUTTER

Cream availability is increasing with spot load more available. Retail demand is mixed with holiday orders filled. Food service demand has remained steady to stronger. Many plants are working on producing bulk butter contracts for the first quarter of 2024. The November Cold Storage Report will be released tomorrow and give indication as to stocks in comparison to a year ago. Butter inventory is expected to be about even with a year ago.

OUTSIDE MARKETS SUMMARY

March corn closed up 2.75 cents per bushel at $4.7250, January soybeans closed down 11.00 cents at $12.9725 and March soybean meal closed down $2.30 per ton at $386.40. March Chicago wheat closed up 2.50 cents at $6.1250. February live cattle closed down $1.63 at $168.68. February crude oil is down $0.33 per barrel at $73.89. The Dow Jones Industrial Average is up 332 points at 37,404 with the NASDAQ is up 186 points at 14,964.

Thursday Midday Dairy Market Summary - All Spot Prices Decline

OUTSIDE MARKETS SUMMARY:

CORN:	3 Higher
SOYBEANS:	10 Lower
SOYBEAN MEAL:	$4.70 Lower
LIVE CATTLE:	$0.47 Higher
DOW JONES:	163 Points Higher
NASDAQ:	112 Points Higher
CRUDE OIL:	$90.56 Lower

MIDDAY MARKET UPDATE:

Block cheese price felt the pressure with sellers being aggressive and price falling 5.25 cents, closing at $1.3950 with 10 loads traded. Barrel cheese price declined 0.25 cent, closing at $1.39 with 18 loads traded. The barrel price initially increased 0.75 cent before heavy selling pushed the price lower. There were only unfilled bids remaining at the close at lower prices. Dry whey price declined 0.75 cent, ending at 37.25 cents with six loads traded. Class III futures are 21 cents lower to 2 cents higher with February showing the greatest pressure. Butter price slipped 0.50 cent, closing at $2.60 with four loads traded. This is the first decline of butter in four days.

Grade A nonfat dry milk price slipped 0.25 cent, closing at $1.1550 with one load traded. Class IV futures are 15 cents lower to 24 cents higher. Butter futures are steady to 3 cents higher. Dry whey futures are 0.50 to 1.10 cents lower. USDA will release the November Livestock Slaughter report this afternoon.

Fluid Milk and Cream - Western U.S. Report 51

Temperatures continued to stay near the 60-degree mark in the Central Valley of California this week. Farm level milk output is steady. Some handlers note preliminary records continue to indicate December 2023 milk production is below December 2022 milk production. Processors say milk volumes are meeting manufacturing needs. Stakeholders note spot load availability has improved. Class I demand is lighter as session breaks for educational institutions are around the corner. Demands for all other Classes are strong to steady. 

Temperatures in Arizona moved into the upper 70s/lower 80s for some of the week. Milk production is steady. Manufacturers relay milk volumes are available to meet processing needs. Class I demand is lighter as session breaks at educational facilities are fast approaching. All other Classes have strong to steady demand. 

In New Mexico, temperatures were in the 40s/mid 50s. Handlers indicate milk production is steady and enough milk is available to meet the needs of manufacturers. Class I demand is lighter with educational institutions beginning session breaks in the later part of this week. All other Classes have unchanged demand. 

In the Pacific Northwest, farm level milk output is steady. Handlers note a milder start to winter has contributed to more favorable cow comfort and milk volumes are on anticipated paces. No shortages of milk available for processing needs are reported. Class I demand is lighter as educational institutions throughout the area cycle into their session breaks for late December holidays. Class II, III, and IV demands are strong to steady. 

Milk production in the mountain states of Idaho, Utah, and Colorado is steady. Some Idaho handlers indicate week-to-week differences in milk output have flattened. Some manufacturers are indicating milk volumes are uneven compared to processing capacities, resulting in some shifting of milk volumes amongst processors. With some session breaks at educational facilities beginning, Class I demand is lighter throughout the area. Class II, III, and IV demands are unchanged. 

Cream is readily available in the region. Cream demand is steady. Cream multiples decreased on both ends of the multiple range. Demand for condensed skim milk is steady. Condensed skim milk loads are more available for spot buyers. 

Thursday Morning Dairy Market Update - December Futures Show Significant Activity

OPENING CALLS:

Class III Milk Futures:	Mixed
Class IV Milk Futures:	Mixed
Butter Futures:	Mixed

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	Mixed
Soybean Futures:	3 to 4 Lower
Soybean Meal Futures:	Mixed
Wheat Futures:	3 to 5 Higher

MILK:

The December Class III contract adjusted lower with the release of the weekly AMS prices. It was usual to see a heavy volume of 45 trades in the overnight market in the front-month contract. Class III futures continue to struggle with January through March making new contract lows again Wednesday. Underlying cash cheese is not finding support, keeping pressure on the market. Milk production is not overwhelming the market but remains sufficient for demand. Extra milk that will be available for manufacturing will be handled easily over the holiday period with spot milk prices not expected to be as discounted as they were last year. USDA will release the Livestock Slaughter report for the month of November, which will provide some indication as to the level of slaughter that took place and if low milk prices are having a significant influence on culling. The milk production report did show a decline of 10,000 head from October.

CHEESE:

The hope is that cheese prices do not revisit the lows of early July which could result in a Class III milk price below $15.00 again. There is little to provide support for the market at the present time as we head to the close of the year and a period during which demand slows. There is not much price movement expected for the rest of this week.

BUTTER:

Butter has shown better support than expected, but upside price potential may be limited. No buyers or sellers showing up during spot trading on Wednesday leaves traders guessing as to price direction. There seems to be no urgency to fill orders and no urgency for sellers to move supply. There is a strong possibility price may weaken again before the end of the year.

Wednesday Midday Dairy Market Summary - Further Pressure on Butter

OUTSIDE MARKETS SUMMARY:

CORN:	3 Lower
SOYBEANS:	2 Lower
SOYBEAN MEAL:	$4.70 Lower
LIVE CATTLE:	$1.22 Higher
DOW JONES:	66 Points Higher
NASDAQ:	33 Points Higher
CRUDE OIL:	$0.21 Lower

MIDDAY MARKET UPDATE:

Block cheese price declined 0.75 closing at $1.4475 with 5 loads traded. Barrel cheese price declined 1.75 cents closing at $1.3925 with 11 loads traded. There were 14 unfilled bids for barrels remaining at the close. The does not necessarily mean anything as there were quite a few unfilled bids yesterday, but the price slipped lower today. Blocks showed an unfilled bid and uncovered offer.

Dry whey price declined a penny to 38 cents with 5 loads traded. Class III futures are mixed from 5 cents lower to 4 cents higher. Butter price remained steady at $2.6050 with no loads traded. No one showed up to do any business. Grade A nonfat dry milk price slipped 0.25 cent closing at $1.1575 with one load traded. Class IV futures are unchanged to 8 cents lower. Butter futures are 1.32 cents lower to 0.75 cent higher. Dry whey futures are unchanged to 0.35 cent lower.

Wednesday Closing Dairy Market Update - GDT Posts Gains

MILK

Traders found little direction from underlying cash. The slight weakness of cheese had been factored in. Traders are not interested in buying futures aggressively as there seems to be little potential for the foreseeable future. Some buying for the long term may be taking place in late 2024 contracts but nothing of any volume. The January Class I price was released today with a price of $18.48. This is $1.28 lower than December and $3.93 below a year ago.

The Global Dairy Trade auction took place yesterday with the trade-weighted average increasing 2.3%. There were 27,379 metric tons sold during the event. Anhydrous milk fat price increased 0.2% to $5,578 per metric ton or $2.53 per pound. Butter price increased 9.9% to $5,458 per metric ton or $2.48 per pound. Cheddar cheese price increased 6.9% to $4,265 per metric ton or $1.93 per pound. Lactose remained unchanged at $796 per metric ton or $0.36 per pound. Mozzarella decreased 1.1% to $3,960 to $1.80. Skim milk powder decreased 1.3% to $2,620 per metric ton or $1.19 per pound. Whole milk powder increased 2.9% to $3,207 per metric ton or $1.45 per pound.

AVERAGE CLASS III PRICES

3 Month:	$15.82
6 Month:	$16.53
9 Month:	$17.14
12 Month:	$17.51

CHEESE

Cheese plants indicated there was sufficient milk available but not quite at the levels usual during the holiday period. Spot milk prices may not be at quite the depressed levels they were last year during the holidays but it is unlikely prices will increase any time soon.

Cheese buyers are not aggressive with orders for the holidays already filled. There is limited interest in purchasing to rebuild aging programs anytime soon. If milk production were to tighten through early next year, buyers could become more interested in purchasing a greater supply and building inventory.

BUTTER

Price has been able to hold the recent strong gains providing traders with a bit more hope price may be able to hold better than anticipated through the end of the year. Today, no one showed up during spot trading to do business. Buyers might not be anxious to bid higher to obtain supply while sellers see no need to sell product below the current price. There is some anticipation that price may slip back into the end of the year as manufacturers want to limit inventory.

OUTSIDE MARKETS SUMMARY

March corn closed down 3 cents per bushel at $4.6975, January soybeans closed down 4.25 cents at $13.0825 and January soybean meal closed down $3.30 per ton at $399.90. March Chicago wheat closed down 12.75 cents at $6.1000. February live cattle closed up $1.53 at $170.30. February crude oil is down $0.19 per barrel at $73.75. The Dow Jones Industrial Average is up/down 476 points at 37,082 with the NASDAQ down 225 points at 14,778.

Wednesday Morning Dairy Market Update - Milk Futures Under Pressure

OPENING CALLS:

Class III Milk Futures:	2 to 6 Lower
Class IV Milk Futures:	Mixed
Butter Futures:	Mixed

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	1 to 2 Higher
Soybean Futures:	Mixed
Soybean Meal Futures:	Steady to $1 Higher
Wheat Futures:	2 to 4 Lower

MILK:

Milk futures did not react very much to the milk production report Tuesday nor to the increase of spot prices. Traders are not bullish and not overly bearish at the present time. The downside might be limited unless further weakness is seen for spot prices this week. Milk checks will be lower this month and lower in the early part of next year unless demand increases, or supply tightens or both. Overall weather has been good for milk production, which keeps milk output slowly increasing. However, production is lower than a year ago, but it has not had an impact on supply. Milk futures will be choppy through the rest of the year.

CHEESE:

The slight increase of cheese prices Tuesday did not trigger buying interest. There were several unfilled bids for barrels at the end of trading Tuesday, but that may not translate into a higher price Wednesday as buyers were not aggressive. There may be interest in buying but not at higher prices.

BUTTER:

Price has had a nice increase over the past three days. Once the current buying interest is satisfied, price may drop back again. It is too early for buyers to be aggressive as the focus may be to limit inventory through the end of the year. The Cold Storage report for November will be released on Friday, which may inventory similar to a year ago.

Tuesday Closing Dairy Market Update - Butter Futures Hold a Discount to Cash

MILK

Milk futures did not receive much influence from the November Milk Production report. Class III futures closed mixed with little direction from underlying cash. Class IV futures were steady to slightly higher, seeing limited strength even though butter showed a strong price increase. Traders did not want to jump on the bandwagon just because there was a significant decrease in cow numbers from October with milk production 0.6% below the previous year. This was for November and already absorbed into the market with no real tightness developing and no concern over milk supply.

Milk prices are not expected to move very much through the end of the year and likely not for a period into the new year. Demand seasonally slows early in the year other than the demand for the playoffs and the Super Bowl.

The milk production report showed 10 states of the top 24 states with production declines from November 2022. New Mexico showed the largest decline of 10.1%, followed by Vermont with a decline of 3.4%. Oregon declined 2.4%; Texas was down 2.2%; Colorado was down 2.1%; California declined 1.7 %; Kansas declined 1.5%; Pennsylvania was down 1.4%; Washington was down 0.8%; and Minnesota declined 0.7%. The state with the largest increase was South Dakota with a gain of 7%, followed by Florida with a gain of 6.2%. Ohio gained 2.5% with the rest of the top 24 states showing gains of 2% or less.

AVERAGE CLASS III PRICES

3 Month:	$15.84
6 Month:	$16.54
9 Month:	$17.14
12 Month:	$17.51

CHEESE

At least the weakness of cheese subsided today with only a slight price increase. There were numerous willing buyers for barrels but not at the current price as bids were posted below the market. It will be interesting to see if those buyers will become a bit more aggressive during spot trading on Wednesday. Upside price potential is probably limited for the time being.

BUTTER

Price made a surprising increase over the past three days, gaining 14.50 cents. This has not had a large impact on Class IV futures but provided some support. The substantial price difference between Class IV and Class III futures remains and may continue for the foreseeable future. Traders are not very optimistic as butter futures hold a discount to cash.

OUTSIDE MARKETS SUMMARY

March corn closed down 4.25 cents per bushel at $4.7275, January soybeans closed down 14.50 cents at $13.1250 and January soybean meal closed down $9.60 per ton at $403.20. March Chicago wheat closed up 5.75 cents at $6.2275. February live cattle closed down $0.85 at $168.78. February crude oil is up $1.34 per barrel at $74.16. The Dow Jones Industrial Average is up 252 points at 37,558 with the NASDAQ up 98 points at 15,003.

Tuesday Midday Dairy Market Summary - Butter Pushes Higher

OUTSIDE MARKETS SUMMARY:

CORN:	5 Lower
SOYBEANS:	13 Lower
SOYBEAN MEAL:	$9.20 Lower
LIVE CATTLE:	$0.07 Lower
DOW JONES:	201 Points Higher
NASDAQ:	68 Points Higher
CRUDE OIL:	$0.91 Higher

MIDDAY MARKET UPDATE:

Block cheese price increased 0.25 closing at $1.4550 with 4 loads traded. Barrel price increased 0.50 cent at $1.41 with 11 loads traded. There was an unfilled bid and an uncovered offer remaining at the close of trading. There were 9 unfilled bids for barrels.

Dry whey price decreased 0.50 closing at 39 cents. Class III futures are mixed from 7 cents lower to 6 cents higher. Butter gained 5.75 cents closing at $2.6050 with 5 loads traded. Grade A nonfat dry milk declined a penny to $1.16 with 7 loads traded. Class IV futures are 2 to 12 cents higher. Butter futures are 1.00-2.27 higher. Dry whey futures are 0.30 cent lower 0.20 cent higher.

Tuesday Morning Dairy Market Update - Production Report Has Little Impact

OPENING CALLS:

Class III Milk Futures:	Steady to 4 Higher
Class IV Milk Futures:	Mixed
Butter Futures:	1 to 2 Higher

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	1 to 2 Lower
Soybean Futures:	9 to 12 Lower
Soybean Meal Futures:	$3 to $4 Lower
Wheat Futures:	1 to 2 Lower

MILK:

The November Milk Production report was slightly friendly, but that did not bring buyers into milk futures aggressively in the overnight. Traders will remain cautious as slower overall demand keeps a sufficient supply of milk and dairy products available to the market. The decline of cheese prices Monday is not expected to find strong buyer support from the milk production report. The report was for milk produced in November and the milk has already been absorbed into the market and supply has not tightened. Even though cow numbers are at the lowest level since June 2020, milk per cow has improved with it being at the lowest level since February.

CHEESE:

The weakness of cheese prices is a reflection of market sentiment. Buyers are not aggressive as they see no need to be. There is sufficient supply for demand. Price may not be low enough to stimulate aggressive buyer interest. USDA will release the November Cold Storage report Friday which is expected to show inventory near the same level it was a year ago.

BUTTER:

The strength of butter is likely limited. Once orders are again filled, buyers will not be aggressive and price will fall back. With current butter production and inventory, buyers see no supply tightness in the foreseeable future. Nonfat dry milk price is expected to remain choppy.

Monday Closing Dairy Market Update - November Milk Production Down

MILK

Class III futures took a hit in January through May contracts with January and February down over 30 cents. Both contracts made new lows and closed at $15.59 and $15.79, respectively. This certainly is of concern as it has underlying cheese prices and milk futures following a similar pattern to July.

Class IV futures were steady to slightly higher. November milk production in the top 24 states showed a decline of 0.5%, totaling 17.3 billion pounds. Production per cow totaled 1,948 pounds, down 3 pounds from November 2022. Cow numbers fell 9,000 head from October. Milk production in the U.S. totaled 18.1 billion pounds, down 0.6 percent from a year ago. Milk production per cow averaged 1,932 pounds which was 2 pounds below November 2022. Cow numbers declined 10,000 head from October with total cow numbers at 9.36 million head. This is the lowest U.S. herd since June 2020. However, it has been the lowest monthly milk production since February.

AVERAGE CLASS III PRICES

3 Month:	$15.84
6 Month:	$16.53
9 Month:	$17.14
12 Month:	$17.50

CHEESE

Cheese prices took a hit with prices falling to the lowest levels since early July. Manufacturers want to move supply ahead of the end of the year rather than carry it over. They do not want to pay for storage and end up losing money if prices do not find support for a while.

Demand has been good domestically, but export demand has been substantially less than desired. More milk will be moving to the vat over the next few weeks as schools will be closed.

BUTTER

The increase in butter price today did not garner much buying interest in Class III futures. Even the gain in nonfat dry milk did not help. Traders are not buying into the strength as the gains may be short-lived through the end of the year. Once immediate orders are filled, the price may settle back again.

OUTSIDE MARKETS SUMMARY

March corn closed down 6 cents per bushel at $4.7700, January soybeans closed up 11.25 cents at $13.2700 and January soybean meal closed up $7.20 per ton at $412.80. March Chicago wheat closed down 12.25 cents at $6.1700. February live cattle closed up $0.28 at $169.63. January crude oil is up $1.07 per barrel at $72.50. The Dow Jones Industrial Average is up 1 point at 37,306 and the NASDAQ is up 91 points at 14,905.

November Milk Production in the United States down 0.6 Percent

November Milk Production down 0.5 Percent        

Milk production in the 24 major States during November totaled 17.3 billion pounds, down 0.5 percent from November 2022. October revised production, at 17.9 billion pounds, was down 0.6 percent from October 2022. The October revision represented a decrease of 37 million pounds or 0.2 percent from last month's preliminary production estimate.  Production per cow in the 24 major States averaged 1,948 pounds for November, 3 pounds below November 2022.   The number of milk cows on farms in the 24 major States was 8.90 million head, 26,000 head less than November 2022, and 9,000 head less than October 2023.   

November Milk Production in the United States down 0.6 Percent  

Milk production in the United States during November totaled 18.1 billion pounds, down 0.6 percent from November 2022.  Production per cow in the United States averaged 1,932 pounds for November, 2 pounds below November 2022.  The number of milk cows on farms in the United States was 9.36 million head, 44,000 head less than November 2022, and 10,000 head less than October 2023. 

Monday Midday Dairy Market Summary - Cheese Prices Tumble

OUTSIDE MARKETS SUMMARY:

CORN:	7 Lower
SOYBEANS:	4 Higher
SOYBEAN MEAL:	$5.70 Higher
LIVE CATTLE:	$1.10 Higher
DOW JONES:	14 Points Higher
NASDAQ:	85 Points Higher
CRUDE OIL:	$1.71 Higher

MIDDAY MARKET UPDATE:

Block cheese price fell 6.75 cents, closing at $1.4525 with six loads traded. Barrel cheese price fell 4.50 cents, closing at $1.4050 with 13 loads traded. This moves cheese prices to the lowest level since July. Manufacturers want to move supply as soon as possible before the end of the year. Storing it will only cost them money with the potential for little return as prices may not change very much.

Dry whey price remained unchanged at 39.50 cents with no loads traded. Class III futures are 30 cents lower to 9 cents higher. Pressure is being put on nearby months. Butter price increased 5.75 cents, closing at $2.5475 with two loads traded. Grade A nonfat dry milk price increased a penny to $1.17 with no loads traded. Class IV futures are mixed. Butter futures are higher in response to the strength of spot price. Dry whey futures are mixed. USDA will release the November Milk Production report this afternoon.

Monday Morning Dairy Market Update - Milk Production Report Releases Today

OPENING CALLS:

Class III Milk Futures:	Steady to 6 Lower
Class IV Milk Futures:	Mixed
Butter Futures:	Steady to 1 Higher

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	1 to 2 Lower
Soybean Futures:	2 to 3 Lower
Soybean Meal Futures:	Mixed
Wheat Futures:	5 to 7 Lower

MILK:

Class III futures were under further pressure overnight as traders do not anticipate much upside price potential moving through the week. A bounce of milk futures certainly would be welcomed but may be difficult to achieve. Any increase in underlying cash most likely will be met with skepticism and limited buying interest. Milk is sufficient for all areas of demand with more milk being available for manufacturing through the holiday period. USDA will release the November Milk Production report Monday afternoon. I estimate milk production to be down 0.4% from a year ago with cow numbers down 3,000 head from October.

CHEESE:

Cheese prices may show further weakness Monday as sellers may want to move product ahead of the end of the year. Buyers are not purchasing for the holiday season anymore but are looking ahead into next year with contracts being made or orders already being filled. Buying is being done to rebuild aging programs, but only at lower prices. Barrel price is near falling back to July price levels.

BUTTER:

Price is expected to continue to chop around but decrease further through the end of the year. Current production is sufficient for demand. Inventory may end the year like the level of last year. Churning is active but lighter due to the demand for cream from Class II production for the holidays. However, that will slow as much of the holiday demand has been filled, leaving more available for churning.