MILK
There had been some optimism that lower milk production in February would get the attention of cheese buyers and they would step up to the plate and purchase more aggressively. That did not materialize as there was more selling interest in the spot market than buying interest. The number of offers remaining may indicate a further downside is possible.
Milk production is improving seasonally as spring flush is here. Production is running lower than last year but remains sufficient for demand. Some manufacturing plants are running near capacity, causing spot milk prices to remain mostly below class. The increase in cow numbers from January is not pushing milk production higher but it does indicate numbers are not as tight as had been anticipated. It is difficult to determine how long milk prices will remain low and what the impact will be on cow numbers as the year progresses.
AVERAGE CLASS III PRICES
| 3 Month: | $16.13 |
| 6 Month: | $16.90 |
| 9 Month: | $17.43 |
| 12 Month: | $17.60 |
CHEESE
The bearishness of the cheese market today was not just the decreasing cheese prices but the volume of uncovered offers that remained at the close of spot trading. This suggested there may be further selling pressure on Friday if sellers need to move the product.
Block price is down to its lowest level since Dec. 26, 2023. Barrels have not been quite as bearish but have declined significantly from the high a month ago.
BUTTER
Butter continues to chop and is likely to remain in the sideways trading range until we move closer to the summer and hotter weather. There are sufficient cream supplies for churning which keep butter available without concern of a tight supply for the time being. Export interest may be the key to price strength as the year progresses.
OUTSIDE MARKETS SUMMARY
May corn closed up 1.75 cents per bushel at $4.4075, May soybeans closed up 2.50 cents at $12.1200 and May soybean meal closed up $1.80 per ton at $344.30. May Chicago wheat closed up 1.75 cents at $5.4675. June live cattle closed down $0.28 at $184.50.
May crude oil is down $0.20 per barrel at $81.07. The Dow Jones Industrial Average is up 269 points at 39,781 with the NASDAQ up 32 points at 16,402.
