MILK
Class III milk futures moved substantially higher as traders bought contracts due to underlying cash prices being steady and higher. Short covering was triggered with good trading volume. The September Class III contract is mostly priced but gained 21 cents and nearly reached $23.00. Class IV futures posted double-digit gains in numerous contracts supported by stronger butter and nonfat dry milk prices. The market has bullish momentum with underlying cash showing little, if any, weakness. Traders are responding in anticipation of stronger milk prices as September progresses. The milk supply is not tight but tighter than it had been. Higher volumes of milk are moving to deficient areas to supply the needs of school systems. Spot milk prices are as much as $2.00 over class, but available for those who need it. There is concern milk production will remain below year-earlier levels for an extended time.
AVERAGE CLASS III PRICES
| 3 Month: | $23.13 |
| 6 Month: | $22.01 |
| 9 Month: | $21.09 |
| 12 Month: | $20.63 |
CHEESE
The barrel cheese price surpassed the high of August 21 and is now at the highest level since June 9, 2022. Cheese buyers need to step in to purchase what they need as waiting for a price break has not been profitable. Price retracements will be limited or may not take place with demand from buyers improving. The decline in the production of American cheese in June compared to the previous year should support the market.
BUTTER
The butter price may retest the recent high and potentially move higher as retail and food service demand improves. Churning is active more cream was available last week. Regional cream prices slipped on the lower end of the price ranges that were seen in the past few weeks. However, that may be short-lived as milk moves to deficit areas for school accounts.
OUTSIDE MARKETS SUMMARY
December corn closed up 1.00 cent per bushel at $4.0725, November soybeans closed up 13.00 cents at $10.1800 and December soybean meal closed up $.60 per ton at $325.00. December Chicago wheat closed up 1.50 cents at $5.6850. October live cattle closed up $1.75 at $176.93. October crude oil is up $1.15 per barrel at $68.82. The Dow Jones Industrial Average is up 484 points at 40,830 with the NASDAQ up 194 points at 16,885.
