MILK
It was a positive week for Class III futures even though futures fell back today. The September, October, and November contracts closed above $20.00. The October and later contracts established new contract highs. Underlying cheese prices were mixed with much of the support from the dry whey price moving to the highest level since February 22. There is support under the market, but milk prices are moving in a calculated manner rather than being moved by perception. The anticipation is that milk prices may increase as the summer progresses and milk production slows. That may or may not be the case depending on demand.
Milk output and demand are somewhat balanced keeping cash buyers comfortable at the current level. Limited attention is being given in the news to the impact of bird flu on milk production. Farms are doing a good job with biosecurity and reducing the impact on the infected cows. USDA will release the June Milk Production report which will provide the change in cow numbers and milk production compared to June 2023. The milk production and the monthly slaughter report will indicate the potential for milk production if production per cow improves later in the year.
AVERAGE CLASS III PRICES
| 3 Month: | $20.12 |
| 6 Month: | $20.14 |
| 9 Month: | $19.59 |
| 12 Month: | $19.25 |
CHEESE
For the week, blocks declined 2.50 cents with 23 loads traded. The average price for the week is $1.8630. Barrels gained 6.25 cents with 22 loads traded. The average price for the week is $1.8980. The block price ranged from $1.86 to $1.8650 throughout the week. Barrels had a wider swing with the $1.9125 holding from Wednesday through Friday. Buyers and sellers took care of business as needed rather than trying to outbid each other over the concern of potentially tighter supply.
BUTTER
For the week, butter declined 2.50 cents with 69 loads traded. The weekly average price is $3.1140. It is surprising sellers needed to move that amount of butter. Grade A nonfat dry milk increased by 1.75 cents with 10 loads traded. The weekly average price is $1.1795. Price fell to the lowest level since June 25 breaking below the recent trading range. Buyers may step in to take advantage of the lower price next week as they look to increase ownership of butter for later demand.
OUTSIDE MARKETS SUMMARY
December corn closed down 0.25 cent per bushel at $4.0475, November soybeans closed down 7.00 cents at $10.3600 and December soybean meal closed down $4.00 per ton at $307.50. September Chicago wheat closed up 7.50 cents at $5.4275. August live cattle closed up $0.85 at $183.10. September crude oil is down $2.66 per barrel at $78.64. The Dow Jones Industrial Average is down 377 points at 40,288 with the NASDAQ is down 144 points at 17,727.
