MILK
Milk futures held up well despite the weakness of cheese and butter prices. Traders seem to believe the bottom must be near, or more selling pressure would have been seen in milk futures. The market will need to prove itself before traders may want to step in to buy. The November Class III contract fell below $21 after spending a week above the level. Milk production is steady and should be at the low for the year. Cooler weather will improve cow comfort and should improve milk output. The level of milk production that took place in September is uncertain, and we will not see the production report until next week. There are sufficient supplies of milk available for bottling and manufacturing, leaving buyers unaggressive even if milk production remains below a year ago.
AVERAGE CLASS III PRICES
| 3 Month: | $21.31 |
| 6 Month: | $20.57 |
| 9 Month: | $20.16 |
| 12 Month: | $19.98 |
CHEESE
The barrel cheese prices fell to the lowest level since April 29. The market just cannot find a bottom. The bounce on Friday provided a ray of hope that support would have been found, but that was short-lived. It is anyone's guess as to the level where buyers will support the market.
BUTTER
It was another new low for butter after it appeared the price might be supported. Manufacturers want and need to move supply and are selling it at lower prices. There is no desire to hold for a better price as strong butter output is sufficient to supply the market with fresh production, limiting the decline of inventory.
OUTSIDE MARKETS SUMMARY
December corn closed down 7.50 cents per bushel at $4.0825, November soybeans closed down 9.50 cents at $9.9600 and December soybean meal closed up $.20 per ton at $315.30. December Chicago wheat closed down 13.75 cents at $5.8525. December live cattle closed up $0.35 at $187.93. November crude oil is down $1.73 per barrel at $73.83. The Dow Jones Industrial Average is up 201 points at 43,065 with the NASDAQ up 160 points at 18,503.
