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.
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