MILK
The dairy markets seem to be in the doldrums as there is little support being seen from underlying cash and from fundamentals. Milk production is steady and sufficient for both bottling and manufacturing. There was an increase in fluid milk demand ahead of the winter storms, but that has settled down to near normal again. School accounts are being filled with sufficient milk available. Cheese production is steadily keeping buyers supplied and extra production is being moved to the daily spot market to limit the build of inventory. Spot milk remains near the price level of the holidays with prices ranging from $7.00 under class to $0.50 under class. It is a period of slower demand seasonally so there are no expectations for a jump in demand anytime soon. The Class I price for February was released today at $17.99, down $0.49 from the January price.
AVERAGE CLASS III PRICES
| 3 Month: | $15.61 |
| 6 Month: | $16.51 |
| 9 Month: | $17.10 |
| 12 Month: | $17.42 |
CHEESE
There is again concern cheese price may move back to the lows. Lower prices will increase buyer interest, but that interest may have a lower threshold. Cheese buyers are not concerned over supply and will continue to purchase on price weakness. Inventory is expected to close the year similar to the level of last year.
BUTTER
Price may have limited upside potential as heavy cream supply keeps churns busy. Some have turned cram away due to plants already being at capacity. Some cream is reportedly being frozen for later use. This may limit price potential for a period. Retail demand is reported as steady with food service demand weaker.
OUTSIDE MARKETS SUMMARY
March corn closed up 1.75 cents per bushel at $4.4400, March soybeans closed up 7.75 cents at $12.1350 and March soybean meal closed up $2.60 per ton at $361.30. March Chicago wheat closed up 3.00 cents at $5.8550. February live cattle closed up $1.73 at $174.83. February crude oil is up $1.52 per barrel at $74.08. The Dow Jones Industrial Average is up 202 points at 37,469 with the NASDAQ is up 200 points at 15,056.
