MILK
Class III futures took a breather today with traders waiting for cash to catch up. Milk production is steady to stronger in most areas. Cheese plants are running full schedules and can handle the available milk supplies without difficulty. Spring flush continues but at a lower level than last year. The recent gains in cheese prices may indicate solid support in the market.
The April Federal Order Class prices were announced with the Class II price reaching $21.23, up $0.11 from March. The Class III price was $15.50. down $0.84 from the previous month. The Class IV price was $20.11, up $0.02 from March. If the current Class III futures price holds for May, the base milk price will increase by nearly $3 per cwt and would be very welcomed by farmers.
The FSA released the average soybean meal price for March with a decline of $1.46 per ton moving to $362.17 per ton. This was the final price needed to calculate the income over feed price for the month. The March income over feed price was $9.65, resulting in no payment under the Dairy Margin Coverage program.
AVERAGE CLASS III PRICES
| 3 Month: | $18.51 |
| 6 Month: | $18.74 |
| 9 Month: | $18.61 |
| 12 Month: | $18.48 |
CHEESE
Cheese manufacturers in the Midwest are reporting stronger interest in cheese. Some plants have indicated that new customers are being turned away in some cases. It is not that the cheese supply is tight but neither is it abundant. This is a good position to be in with any increase in demand, either domestically or internationally, which could provide greater support for prices.
BUTTER
The butter price broke above the psychological level of $3, which could open the way for further gains with that level now potentially becoming support. Price has substantial upside potential as time moves forward and demand improves. Buyers will not be able to hold back waiting for a price decline and will need to step up to buy any price breaks.
OUTSIDE MARKETS SUMMARY
July corn closed up 4 cents per bushel at $4.5075, July soybeans closed up 7.25 cents at $11.7025 and July soybean meal closed down $2.90 per ton at $349. July Chicago wheat closed down 4 cents at $5.9925. June live cattle closed down $1.13 at $173.85. June crude oil is down $2.78 per barrel at $79.15. The Dow Jones Industrial Average is up 87 points at 37,903 with the NASDAQ down 52 points at 15,605.
