MILK
Class III milk futures have rebounded nicely today. Traders may feel prices have reached a level at which buyers may be interested in purchasing to increase ownership. The increase in the volume of block cheese today and the slight price increase may generate bullish potential for the market. Double-digit gains through February were good to see. However, the top is in for the year and a price rebound will fall short of the highs set last month. Milk production is variable but generally steady. The USDA's Dairy Market News publication reports more instances of potential dairy farm expansion planned and taking place in the Central region. This is surprising as the heifer supply remains tight and at extremely high prices. Milk component values are stronger than usual for this time of year and may stabilize as milk production slowly increases. USDA will release the World Agricultural Supply and Demand report on Friday providing their estimates for milk production, milk prices, and dairy product prices for this year and 2025.
AVERAGE CLASS III PRICES
| 3 Month: | $21.65 |
| 6 Month: | $20.83 |
| 9 Month: | $20.32 |
| 12 Month: | $20.09 |
CHEESE
Cheese demand is variable depending on the area and the variety. Demand needs to increase to provide greater support under the market. There is some expectation the market may be overdone to the downside and a rebound in prices may unfold as buyers turn more aggressive at these lower prices. Spot milk is priced from $0.50 - $2.00 over class with a tighter supply.
BUTTER
Butter demand has improved from retail customers, but supply is readily available to meet that demand. The cream supply is sufficient to keep churning active. Buyers have been rewarded by holding back and purchasing as the market weakens. This will end at some point, but it is unclear when buyers will become more aggressive.
OUTSIDE MARKETS SUMMARY
December corn closed down 2.50 cents per bushel at $4.1850, November soybeans closed down 5.50 cents at $10.1475 and December soybean meal closed down $5.10 per ton at $316.10. December Chicago wheat closed up 4.75 cents at $6.0375. December live cattle closed up $1.05 at $188.28. November crude oil is up $2.61 per barrel at $75.85. The Dow Jones Industrial Average is down 58 points at 42,454 with the NASDAQ down 10 points at 18,282.
