MILK
Class III futures closed mostly higher to begin the week even though the barrel cheese price declined. Traders seemed to believe the steady block price may indicate there is little downside potential at this time of year. The bearishness of the August Milk Production report did not trigger aggressive selling as had been anticipated. It did indicate that farmers have been holding onto cows and doing a great job of getting milk from those cows due to production per cow up 8 pounds above a year earlier. It had been anticipated that holding onto older cows or lower producers would reduce milk production potential. If that were the case, milk production would have been substantially higher if the heifer supply had been readily available at reasonable prices. The August Livestock Slaughter report showed dairy cattle slaughter up 5,400 from July at 231,300 head. However, this was 43,900 head lower than in August 2023.
AVERAGE CLASS III PRICES
| 3 Month: | $23.44 |
| 6 Month: | $22.09 |
| 9 Month: | $21.15 |
| 12 Month: | $20.69 |
CHEESE
The weakness of the barrel cheese price may continue. No interest has been shown from buyers over the past three days. There may be a price void under the market with no idea where buyers will be willing to step back in. Last week, Dairy Market News reported that processors indicated barrel supplies are finally loosening with supply not as tight as it had been. Traders seem to believe the downside price potential may be limited but it is difficult to know where that price level might be.
BUTTER
Butter continues to show weakness with buyers showing little interest in purchasing supply at current levels. It has been a surprise that the price has fallen back to the level last seen on April 19th. There is sufficient supply available to the market with churning active and inventory higher than a year ago.
OUTSIDE MARKETS SUMMARY
December corn closed up 11.75 cents per bushel at $4.1350, November soybeans closed up 27.25 cents at $10.3925 and December soybean meal closed up $9.50 per ton at $328.70. December Chicago wheat closed up 14.00 cents at $5.8250. December live cattle closed up $0.63 at $183.83. November crude oil is down $0.63 per barrel at $70.37. The Dow Jones Industrial Average is up 61 points at 42,125 with the NASDAQ up 26 points at 17,974.
