MILK
Class III milk futures have trimmed prices significantly over the past two days. The weakness of cheese prices was not expected by the trade resulting in selling pressure the market was thought to have been overdone to the downside yesterday, but the continued weakness today added more pressure on the market. Milk production continues to decline seasonally and is running below a year ago. However, the milk supply is sufficient for demand but not much extra. Spot milk prices are at class to as much as $2.00 above class. Milk handlers are not clamoring to find an outlet for milk.
Weather will continue to affect cow comfort for the next month or so leaving milk production negatively impacted. The weather has been good for crops as current conditions indicate good yields and plentiful supplies. This should keep feed prices low potentially for the upcoming year. This will improve the income over feed price. The June average soybean meal price was released this morning at $384.10 per ton. This was down $4.55 per ton from May and down $29.36 per ton from June 2023. This results in an income over feed price of $11.66. This is the highest income over feed price since June 2022.
AVERAGE CLASS III PRICES
| 3 Month: | $20.87 |
| 6 Month: | $20.31 |
| 9 Month: | $19.70 |
| 12 Month: | $19.37 |
CHEESE
Buyers have stepped back and are waiting to see how aggressive sellers will be. Only offers in the spot market today suggest further weakness for Friday. The market can change quickly, and buyers could take advantage of the lower prices, but that may not happen until sellers no longer offer cheese at lower prices. The upside price potential may be limited in the near term and buyers and sellers take care of business as needed.
BUTTER
Butter remains in the range as buyers are aggressive when they need to be and seem to have a threshold of where they are willing to buy. Churning has declined due to the tighter cream market, but that has not tightened the butter market. Inventory is available to add to any shortfall in production. Demand remains steady with some slowing from food service demand.
OUTSIDE MARKETS SUMMARY
December corn closed down 1.25 cents per bushel at $3.9850, November soybeans closed down 6.00 cents at $10.1650 and December soybean meal closed up $.50 per ton at $316.20. September Chicago wheat closed up 4.75 cents at $5.3200. October live cattle closed down $2.95 at $183.73. September crude oil is down $1.60 per barrel at $76.31. The Dow Jones Industrial Average is down 495 points at 40,348 with the NASDAQ down 405 points at 17,194.
