MILK
Class III milk futures closed the week on a negative note with weakness in futures. The day began with higher prices as the anticipation of a higher block cheese price filtered through the market. Spot trading changed that with weakness in both blocks and barrels. Traders were thrown a bearish curve ball on the August Milk Production report. Milk output in the top 24 states totaled 18.1 billion pounds, up 0.1% from August 2023. Milk production above a year ago was not expected to happen this year, Milk production per cow was a surprise at 2,036 pounds, up 8 pounds from a year ago. Cow numbers remained unchanged at 8.88 million head from July. The U.S. milk output totaled 18.8 billion pounds, down 0.1% from August 2023. Production per cow totaled 2,018 pounds, up 8 pounds from a year ago. Cow numbers held steady at 9.33 million head. This may put some pressure on milk futures next week with traders selling and buyers on the spot market holding back as milk production might grow through the end of the year.
AVERAGE CLASS III PRICES
| 3 Month: | $23.43 |
| 6 Month: | $22.05 |
| 9 Month: | $21.13 |
| 12 Month: | $20.67 |
CHEESE
For the week, blocks declined 3.75 cents with seven loads traded. Barrels increased 10.50 cents with 11 loads traded. Dry whey declined by 1.75 cents with 12 loads traded. Barrels set a record higher on Wednesday and then slipped back the second half of the week. Buyers to step back as a tighter supply may not develop into the end of the year as a result of higher milk production than anticipated in August. The August Cold Storage report next week may provide a bullish scenario.
BUTTER
For the week, butter fell 15.75 cents with 14 loads traded. Grade A nonfat dry milk declined 1.25 cents with 32 loads traded. Nonfat dry milk may provide continued support to Class IV futures offsetting some of the weakness of butter. Butter futures hold a discount to cash moving through the first half of next year with the price not expected to be as strong.
OUTSIDE MARKETS SUMMARY
December corn closed down 4.25 cent at $4.0150. November soybeans closed up 0.25 cent at $10.12350. December wheat gained 4 cents closing at $5.6950. December soybean meal closed $1.20 per ton lower at $318.70. October live cattle jumped $2.60 closing at $182.57. December crude oil gained $0.07 closing at $71.25 per barrel. The DOW gained 38 points closing at 42,0673 with the Nasdaq down 66 points at 17,948.
