MILK
Class III milk futures took a beating again today with the May contract falling to a new contract low. June and July contracts fell to new lows. The market remains bearish with little to make it move higher at present. This may not change much until we move through spring flush as there is sufficient milk for demand from both bottling and manufacturing. Milk production is improving seasonally resulting in spot milk prices in the Midwest running as much as $6.00 below class with most loads from $3.50 below to steady with class. Lower milk output than a year ago should be tightening the market, but reduced demand keeps this from becoming an issue. Demand should increase during the second half of the year, which may then tighten supply, but it will be up to demand to provide price support. Wishing the market moves higher will not get it done. There is strong demand for replacement heifers even at the current milk prices. Farmers continue to try to keep barns full and milk output strong.
AVERAGE CLASS III PRICES
| 3 Month: | $16.03 |
| 6 Month: | $16.76 |
| 9 Month: | $17.36 |
| 12 Month: | $17.35 |
CHEESE
Dairy Market News indicates that demand for cheese has been a bit more active recently. This may be based on certain varieties of cheese and not just overall demand. However, the increase in demand is not tightening supply. American cheese inventory decreased in February indicating good demand compared to production, but buyers of cheese are not stepping up very aggressively. Blocks might move to a new low again soon which would put the price back to the level of July 2023.
BUTTER
Retail demand is reported to be strong as the Easter weekend is near. Retail has already prepared to meet the increased demand. Retailers will need to restock shelves after the holiday which could bring buyers into the spot market more aggressively at the beginning of next week. However, there is sufficient supply to meet the demand. Plentiful cream supplies at reasonable prices will keep churning active.
OUTSIDE MARKETS SUMMARY
May corn closed down 5.75 cents per bushel at $4.2675, May soybeans closed down 6.50 cents at $11.9250 and May soybean meal closed down $.80 per ton at $339.00. May Chicago wheat closed up 4.00 cents at $5.4750. June live cattle closed up $0.30 at $178.68. May crude oil is up $.09 per barrel at $81.71. The Dow Jones Industrial Average is up 478 points at 39,760 with the NASDAQ is up 84 points at 16,400.
