MILK
The spring flush is finished with milk production mostly flat. Milk output is expected to decline in the weeks to come as temperatures increase. Spot milk is not as readily available as it had been. Spot prices remain $1.00 to $2.00 under class. Some plants report component values are beginning to decline while others indicate greater declines. This is seasonal and has been anticipated. Lower components will impact cheese yields and cream supply.
Traders did not know how to approach the market today, which left Class III futures mixed and Class IV futures steady to lower. Underlying cash prices are expected to remain choppy. Traders will react to strength or weakness with increased volatility expected.
AVERAGE CLASS III PRICES
| 3 Month: | $19.91 |
| 6 Month: | $19.90 |
| 9 Month: | $19.58 |
| 12 Month: | $19.39 |
CHEESE
The level of demand is variable with some cheese plants indicating they are oversold as demand has increased noticeably. Other plants indicate they are just beginning to see demand improving. Cheese prices are not expected to decline very much on any price weakness. Buyers will be willing to purchase for upcoming demand on price breaks. Upside price potential is also expected to be limited as increased milk volumes move to the vat.
BUTTER
Butter is taking two steps forward and one step back. Buyers will purchase more aggressively on price breaks as they desire to increase ownership ahead of later demand. Manufacturers are churning as much as possible ahead of a tighter cream supply and planned downtime for maintenance.
OUTSIDE MARKETS SUMMARY
July corn closed up 12.75 cents per bushel at $4.5200, July soybeans closed up 22.75 cents at $12.0000 and July soybean meal closed up $3.30 per ton at $362.80. July Chicago wheat closed down 7.25 cents at $6.3950. August live cattle closed down $0.40 at $177.48. July crude oil is up $1.56 per barrel at $75.63. The Dow Jones Industrial Average is up 79 points at 38,886 with the NASDAQ down 15 points at 17,173.
