MILK
Milk production over the past week has been steady to higher. There has been some anticipation that production would hold steady with spring flush having run its course. It is running lower than a year ago but still following the seasonal curve.
Milk futures continue to be supported. The anticipation is for milk production to tighten more than usual during the second half of the year. Whether this will happen remains to be seen. USDA estimates overall milk production for 2024 will be higher than last year. The market needs to see demand improve for current futures prices to be realized. The economic condition may make that difficult to materialize unless consumers find good value in dairy products relative to other foods.
Restaurant traffic is variable and could have a large impact on demand. Demand for Class II milk is increasing as spring progresses and manufacturers look ahead to products more popular in summer. Schools are closing and moving more milk to manufacturing.
AVERAGE CLASS III PRICES
3 Month: | $19.60 |
6 Month: | $19.62 |
9 Month: | $19.31 |
12 Month: | $19.04 |
CHEESE
Even though the block cheese price slipped, traders took it in stride, remaining unconcerned over the potential for further weakness. Milk futures had already adjusted on Tuesday, leaving little reason for liquidation to continue. There were unfilled bids for barrels at the close of spot trading with buyers finding no reason to bid higher. Cheese production schedules are increasing at some locations as more milk shows up due to schools closing for the summer.
BUTTER
The butter price is expected to remain choppy with the price potentially retesting the high of $3.0750. Even though the price has been choppy, it remains in an overall uptrend. Cream supply is beginning to tighten as Class II demand increases.
OUTSIDE MARKETS SUMMARY
July corn closed down 5 cents per bushel at $4.6250, July soybeans closed down 1 cent at $12.1350 and July soybean meal closed down $1.60 per ton at $371.70. July Chicago wheat closed down 6.75 cents at $6.6575. June live cattle closed up $0.08 at $178.25. June crude oil is up $0.61 per barrel at $78.63. The Dow Jones Industrial Average is up 350 points at 39,908 with the NASDAQ up 231 points at 16,742.