MILK
Class III milk futures closed lower. Further pressure was put on contracts after the September Milk Production report was released and showed milk production higher than a year ago. This is bearish to the market as milk production was anticipated to remain below a year ago. Milk production in the top 24 states totaled 17.5 billion pounds, up 0.2% from the previous year. Milk production per cow was 8 pounds higher than September 2023. Cow numbers totaled 8.89 million head, unchanged from August. U.S. milk production totaled 18.2 billion pounds, up 0.1% from September 2023. Cow numbers remained unchanged from August at 9.328 million head. Milk production per cow was 9 pounds higher than a year ago. The greater bearishness of the report was the revision from the previous month. August milk production in the top 24 states was revised to an increase of 0.5%. U.S. milk production was revised higher showing an increase of 0.4%. Third-quarter milk production was up only 15 pounds above the third quarter of 2023 and too minor to show a percentage increase.
AVERAGE CLASS III PRICES
| 3 Month: | $21.43 |
| 6 Month: | $20.75 |
| 9 Month: | $20.28 |
| 12 Month: | $20.08 |
CHEESE
Traders did not welcome the weakness of cheese prices. The decline may be short-lived, but traders are reactive to the market and are not interested in buying and holding for the long term. The decline in cheese prices may be viewed as a buying opportunity. However, higher milk production than anticipated may leave buyers less aggressive in the market as cheese production should remain strong and be available for demand. This will need to be balanced with the cold storage report to be released on Friday.
BUTTER
The heavy supply of butter that had been available to the market might have come back into balance with sellers not offering butter at lower prices or in a large volume. Buyers may need to step up more to purchase supplies for immediate and fill-in demand.
OUTSIDE MARKETS SUMMARY
December corn closed up 4.75 cents per bushel at $4.0950, November soybeans closed up 11.00 cents at $9.8100 and December soybean meal closed up $2.70 per ton at $318.30. December Chicago wheat closed down .50 cent at $5.7225. December live cattle closed down $0.50 at $186.83. December crude oil is up $1.35 per barrel at $70.04. The Dow Jones Industrial Average is down 344 points at 42,932 with the NASDAQ up 50 points at 18,540.
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