MILK
It was a huge turnaround day for Class III futures with the August contract reaching up to $21.00 briefly. If the market follows through tomorrow, futures could be back to where they were a week earlier. The increased volatility would seem to reduce trader interest in the market, but that has not been the case with traders seeing more opportunity.
Fluid milk sales in March were 4.1% below March 2023. Conventional sales of whole milk declined by 1.7%; flavored whole milk declined by 2.7%; reduced-fat milk declined by 9.2%; low-fat milk declined by 5.7%; fat-free skim fell by 17.9%; flavored fat-reduced milk declined by 8.7% with buttermilk sales down 5.3%. Organic whole milk sales increased by 12.0%; organic flavored whole milk sales fell by 34.6%; organic reduced fat milk declined 2.6%; organic low-fat declined by 18.9%; organic fat-free skim milk fell 22.1% with flavored fat-reduced milk sales down 34.0%.
AVERAGE CLASS III PRICES
| 3 Month: | $20.41 |
| 6 Month: | $20.38 |
| 9 Month: | $19.96 |
| 12 Month: | $19.69 |
CHEESE
Cheese prices made a nice little recovery but remained substantially below the highs of mid-May. Greater milk volumes are moving to the cheese vat as schools are closed for the summer. This is not causing buyers to step back believing there will be sufficient cheese supplies through the rest of the year. Buyers are willing to step up and purchase on price breaks increasing ownership for later demand. There is a concern milk supply could tighten and inventory could decrease significantly.
BUTTER
The weakness of butter may continue on Tuesday, but price weakness may be short-lived. Butter supply is tightening in Europe and Oceania with world prices rising. This may bring more business to the U.S. increasing exports. Churning is expected to slow as the cream supply tightens and other Class II product production increases.
OUTSIDE MARKETS SUMMARY
July corn closed up 3.00 cents per bushel at $4.5175, July soybeans closed up 9.00 cents at $11.8825 and July soybean meal closed up $7.30 per ton at $368.00. July Chicago wheat closed down 20.00 cents at $6.0750. August live cattle closed up $2.80 at $179.98. July crude oil is up $2.62 per barrel at $78.15. The Dow Jones Industrial Average is up 69 points at 38,868 with the NASDAQ up 59 points at 17,193.
