MILK
The April Milk Production report had an impact on Class III milk futures. After the milk production report was released this afternoon, selling pressure increased with nearby contracts making new lows for the day. Milk production in the top 24 states declined 0.2% totaling 18.3 billion pounds. March milk production was revised higher resulting in a decline of 0.5% rather than the reported decline of 0.9%. Milk production has been stronger than expected even with cow numbers declining. Production per cow in the top 24 states increased by 8 pounds averaging 2,064 pounds per cow. Cow numbers declined by 7,000 head from March. Milk production in the country declined by 0.4% from April 2023. Milk production per cow increased by 9 pounds from a year earlier totaling 2,049 pounds. Cow numbers were 8,000 head less than in March. Milk production is stronger than anticipated though cow numbers have declined. This resulted in a bit more negativity in futures to end the day. This may not be completely reflected in the closing prices as the report was released near the time the CME settled the market for the day. However, the weakness may be reflected in overnight trade. There were 12 of the top 24 states which showed production declines. New Mexico showed the greatest loss with a decline of 17.3%. This was followed by a decline of 7.2% in Georgia and down 6.3% in Oregon. The rest of the losses were less than 4.0%. The state with the greatest gain was South Dakota with a gain of 12.3%. Florida showed a gain of 11.4%. Iowa gained 3.6% with the rest of the gains being less than 3.0%.
AVERAGE CLASS III PRICES
| 3 Month: | $20.04 |
| 6 Month: | $19.91 |
| 9 Month: | $19.59 |
| 12 Month: | $19.33 |
CHEESE
The weakness of cheese today does not indicate further losses may develop. However, buyers could hold back due to the slight weakness and milk production holding better than anticipated. Sellers of cheese may now want to sell more aggressively, taking advantage of the higher prices that developed. The concern over tighter milk supply may move to the back burner.
BUTTER
Butter price extended the gain pushing price above the previous high two weeks ago. The trend remains higher with demand showing signs of improving. The current supply is not tight, but the perception is that supply will tighten as the year progresses. This perception may continue to support the market unless demand remains stagnant.
OUTSIDE MARKETS SUMMARY
July corn closed up 8.00 cents per bushel at $4.6050, July soybeans closed up 20.00 cents at $12.4800 and July soybean meal closed up $5.30 per ton at $374.10. July Chicago wheat closed up 37.50 cents at $6.8875. June live cattle closed up $0.43 at $181.48. July crude oil is down $0.28 per barrel at $79.30. The Dow Jones Industrial Average is down 197 points at 39,807 with the NASDAQ up 109 points at 16,795.
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