MILK
Milk futures fell back from the earlier strength of the day. Prices are not expected to decline very much unless demand does not increase as anticipated. Milk production is beginning to stabilize as temperatures fall, improving cow comfort. This certainly does not mean that milk production will rebound noticeably in the near term. Class I demand is strong as all schools are now in session. School accounts are being filled with less milk available for manufacturing. Less milk will move around to deficit areas as milk production increases seasonally. There is much uncertainty over price potential through the next few months. Demand will need to improve seasonally and near the level it was last year to keep prices elevated and improve prices as time progresses. The potential for milk production is uncertain as cow numbers remain below a year ago and are not increasing as generally happens when milk prices are strong. Farmers want to push production by adding cows, but that is difficult to accomplish due to the tight heifer supply.
AVERAGE CLASS III PRICES
| 3 Month: | $22.64 |
| 6 Month: | $21.62 |
| 9 Month: | $20.80 |
| 12 Month: | $20.39 |
CHEESE
Cheese demand is steady and increasing with some plants indicating strong demand depending on variety. The greater volume of milk available to the spot market during the weekend has now tightened with spot prices around class to $1.00 above class. Spot prices will strengthen as schools are in session and demand improves. The block cheese price is 0.25 cent from the high in November 2022. If it moves above that level, it will return to prices last seen in June 2022. It does not appear that current prices are hurting demand as of yet.
BUTTER
The butter price remains in check with buyers and sellers liking the price where it is. Buyers are not concerned about the supply at present. Higher prices are met with aggressive selling as butter manufacturers continue to move supply. The nonfat dry milk price continues to increase with a higher price over the past 7 consecutive days. This provides support to Class IV futures as the strength offsets the weakness of butter.
OUTSIDE MARKETS SUMMARY
December corn closed up 3.50 cents per bushel at $4.1275, November soybeans closed up 9.50 cents at $10.2150 and December soybean meal closed up $8.50 per ton at $329.30. December Chicago wheat closed up 14 cents at $5.8075. October live cattle closed down $0.05 at $179.23. October crude oil is down $1.48 per barrel at $68.86. The Dow Jones Industrial Average is up 38 points at 40,975 points with the NASDAQ down 52 points at 17,084.
