MILK
Milk futures have declined substantially over the past month with the past four days posting large losses in nearby months. The November Class III contract fell $2.37 since the high on September 10. The December contract fell $1.87. Milk production is at a seasonal low and may remain that way for a few weeks. However, compared to a year ago, it is improving with lower cow numbers. The gain is in milk production per cow. Fall weather is improving cow comfort in many areas and will have a positive impact on milk production. The Southeast where the hurricane hit has impacted milk production and the movement of milk. Even though it is devastating in that area, it may not have much impact on the milk supply in the country. More milk will continue to move to that area of the country due to the lack of milk supply for schools and regular demand.
AVERAGE CLASS III PRICES
| 3 Month: | $21.35 |
| 6 Month: | $20.53 |
| 9 Month: | $20.12 |
| 12 Month: | $19.93 |
CHEESE
The steady block cheese price does not indicate the market has found support. That may be the case, but it is too early to tell. Buyers are not aggressive and as long as sellers are willing to move supply at lower prices, buyers will remain on the sideline. The barrel price is not low enough as no buyers are willing or need to purchase supplies. The barrel price has fallen 69 cents over the past three weeks after setting a record high. During that decline, only four loads have been traded. Sellers have been unable to move supply even though they continue to offer at lower prices.
BUTTER
The butter price may be low enough to attract buyers to purchase for fill-in orders and look ahead to demand into next year. The cream supply is sufficient for demand with some manufacturers indicating higher volumes of cream are available than usual for this time of year.
OUTSIDE MARKETS SUMMARY
December corn closed up 1.25 cents per bushel at $4.2600, November soybeans closed down 3.75 cents at $10.3400 and December soybean meal closed down $6.50 per ton at $324.00. December Chicago wheat closed up 2.75 cents at $5.9250. December live cattle closed up $0.03 at $187.03. November crude oil is up $2.90 per barrel at $77.28. The Dow Jones Industrial Average is down 399 points at 41,954 with the NASDAQ down 214 points at 17,924.
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