MILK
Class III milk futures continue to struggle overall. Yes, the February and March contracts reacted to the higher cheese prices, but later contracts did not see much buying interest with contracts during the second half of the year eliminating more of the premium that futures had contained. It seems as if it will take a monumental effort to get traders interested in buying for the long term. Fundamentals will need to turn more positive to improve the price outlook. Trading activity was very light in all contracts except for February. February will be more responsive to underlying price movement and naturally will see greater activity. The volatility in the January contract is decreasing as much of it has been priced by the trade. Once it reaches mid-month, there will be very limited movement other than prices adjusting to the weekly AMS prices.
AVERAGE CLASS III PRICES
| 3 Month: | $15.72 |
| 6 Month: | $16.65 |
| 9 Month: | $17.20 |
| 12 Month: | $17.49 |
CHEESE
There is not much more to be said about the cheese market. The bounce in prices today is being viewed with caution. Traders expect price increases to be short-lived following the pattern of the past few months. Cheese prices may be attempting to find some support but with cheese output steady and milk volumes to manufacturing plants increasing, the support might be at a lower price.
BUTTER
Butter price seems on its way down to retest the low of $2.46 from December 14, 2023. There are plentiful supplies of cream available to churn. Active churning is expected to increase supply and build inventory. Butter stocks are expected to be higher at the end of the year than they were a year ago. Retail demand is good, but food service demand has slowed a bit after the holidays.
OUTSIDE MARKETS SUMMARY
March corn closed down 5.75 cents per bushel at $4.5500, March soybeans closed down 10.75 cents at $12.4550 and March soybean meal closed down $.90 per ton at $368.50. March Chicago wheat closed down 19.75 cents at $5.9625. February live cattle closed down $0.63 at $169.95. February crude oil is down $2.96 per barrel at $70.85. The Dow Jones Industrial Average is up 217 points at 37,683 with the NASDAQ is up 320 points at 14,844.
