Tuesday Midday Dairy Market Summary - Butter Finds More Aggressive Buyer Interest

OUTSIDE MARKETS SUMMARY:

CORN:	1 Higher
SOYBEANS:	5 Higher
SOYBEAN MEAL:	$3.40 Higher
LIVE CATTLE:	$0.17 Lower
DOW JONES:	391 Points Higher
NASDAQ:	266 Points Higher
CRUDE OIL:	$0.77 Higher

MIDDAY MARKET UPDATE:

The block cheese price increased 0.75 cent closing at $1.86 with one load traded. The barrel cheese price declined 1.25 cents closing at $1.74 with three loads traded. An offer remained in each at the close of trading. The dry whey price remained steady at 74 cents with no loads traded. Class III futures are 8 cents lower to 19 cents higher. The butter price increased 3.25 cents closing at $2.58 with two loads traded. There was an unfiled bid and four uncovered offers remaining at the close. Grade A nonfat dry milk remained unchanged at $1.3925 with no loads traded. Class IV futures have not been traded. Butter futures are 0.50 to 3.85 cents higher. Dry whey futures are steady in very light activity. The markets close early today and will remain closed on Wednesday for Christmas.

Tuesday Morning Dairy Market Update - Limited Trade Activity Expected

OPENING CALLS:

Class III Milk Futures:	2 to 5 Lower
Class IV Milk Futures:	Mixed
Butter Futures:	Mixed

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	Mixed
Soybean Futures:	3 to 5 Higher
Soybean Meal Futures:	$1 to $2 Higher
Wheat Futures:	Mixed

MILK:

The major reports are behind us for another month and have been factored into the market. It will be up to demand to provide market direction. Buyers of butter and cheese may hold back to assess demand through the holidays before deciding whether they need to be more aggressive. Spot milk is expected to be available at lower prices as schools are closed and some plants will run on reduced schedules. However, the milk will need to find a home and be processed. Milk production will remain steady with weather across much of the country conducive for cow comfort and milk production. Trading activity in milk futures is expected to be light. The markets will close at 12:05 p.m. CST Tuesday and will reopen at 5 p.m. CST Wednesday evening.

CHEESE:

There is not much price movement expected in the spot cheese market Tuesday. The November Cold Storage report showed a seasonal decline in inventory, but the decline was lighter than usual. American, other cheese and total cheese inventory was 7-8% below a year ago with Italian-type cheese increasing from October and was 13% above a year ago. Much of this was expected.

BUTTER:

The substantial decline in butter inventory in November may limit the downside of price moving forward. Strong butter production has been absorbed. Cream supplies have been heavy and churning active, but demand has been steady. The price may remain choppy through the rest of the year.

 

Monday Closing Dairy Market Update - Butter Inventory Declines Substantially

MILK:

Trading volume in milk futures was light with only the January and February contracts showing a few hundred contracts trading in each with only contracts showing substantially less volume. Class III futures were steady to lower through the August contract with minor gains in fourth quarter contracts. Class IV futures showed activity only in the July contract. It is a holiday week with reduced trading hours. The market will be open until 12:05 Central time on Tuesday and closed on Wednesday for Christmas. Trading activity is likely to be even lighter on Tuesday. Lighter trade could cause increased volatility if underlying cash prices showed significant movement up or down. The buyers of cheese and butter have not reacted much to lower milk production in November. They are purchasing based on needs for the first quarter of 2025 and do not see the need to be aggressive.

AVERAGE CLASS III PRICES:

3 Month:	$19.33
6 Month:	$19.33
9 Month:	$19.20
12 Month:	$19.07

CHEESE:

USDA released the November Cold Storage report which showed a decrease in inventory in all categories. American cheese inventory declined 7.9 million pounds totaling 766.6 million pounds. This is 8% below November 2023. Swiss cheese inventory declined by 489,000 pounds from October totaling 23.7 million pounds. This is 13% higher than a year ago. Other cheese inventory declined 5.7%, totaling 544.4 million pounds. This is 7% below a year ago. Total cheese inventory totaled 1.335 billion pounds, down 13.0 million pounds from October and 7% below a year ago.

BUTTER:

Butter inventory declined by 54.2 million pounds in November with supply ending at 213.5 million pounds. This is a large one-month decline and the largest November decline since 2021. Inventory is slightly higher than a year ago, putting butter in a not-as-bearish position as it had been for some time. Butter inventory has not been increasing as some reports had suggested indicating exceptional demand moving to the holidays. Increased butter production has been readily absorbed, which should support the market.

OUTSIDE MARKETS SUMMARY:

March corn closed up 1.50 cents per bushel at $4.4775, January soybeans closed down 5.00 cents at $9.6950 and March soybean meal closed down $4.20 per ton at $298.00. March Chicago wheat closed up 7.50 cents at $5.4050. February live cattle closed down $0.95 at $187.45. February crude oil is up $0.15 per barrel at $69.61. The Dow Jones Industrial Average is up 67 points at 42,907 with the NASDAQ up 192 points at 19,765.

Monday Midday Dairy Market Summary - Spot Trading Shows Limited Direction

OUTSIDE MARKETS SUMMARY:

CORN:	1 Higher
SOYBEANS:	4 Lower
SOYBEAN MEAL:	$3.50 Lower
LIVE CATTLE:	$0.47 Lower
DOW JONES:	40 Points Lower
NASDAQ:	141 Points Higher
CRUDE OIL:	$0.37 Lower

MIDDAY MARKET UPDATE:

The block cheese price remained unchanged at $1.8525 with no loads traded. The barrel cheese price declined 0.75 cent closing at $1.7525 with no loads traded. Offers for one load of blocks and three loads of barrels remained at the close with no buyers showing up to do any business. This added to the negativity of the market. The dry whey price remained unchanged at 74 cents with one load traded. Class III futures are steady to 9 cents lower. The butter price declined 0.75 cent closing at $2.5475 with nine loads traded. There were two unfilled bids and seven uncovered offers remaining at the close. Nonfat dry milk remained unchanged at $1.3925 with three loads traded. Class IV futures have not yet been traded. Butter futures are steady to 2.77 cents lower. Dry whey futures are steady to 1.25 cents lower. The USDA will release the November Cold Storage report Monday afternoon. Inventory is expected to show a decline with cheese stocks below a year ago and butter above a year ago.

Monday Morning Dairy Market Update - Light Dairy Trading Activity Ahead of Cash

OPENING CALLS:

Class III Milk Futures:	Mixed
Class IV Milk Futures:	Mixed
Butter Futures:	Mixed

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	1 to 2 Higher
Soybean Futures:	2 to 4 Higher
Soybean Meal Futures:	$1 to $2 Higher
Wheat Futures:	4 to 5 Higher

MILK:

The strength of milk futures on Friday did not carry over through overnight trading and is not expected to continue Monday unless underlying cash prices show strength. Any buying in the cash market this week will be for regular demand as buyers look ahead to next year. Holiday buying has been finished with overall demand not as good as had been expected. Milk prices may see support if production continues to decline similar to what took place in November. Milk production is steady to higher in most areas of the country from previous weeks, but lower than a year ago in some areas. The USDA will release the November Cold Storage report Monday afternoon.

CHEESE:

Cheese prices have been holding recently with prices likely having reached the upper threshold for the time being. Buyers are not expected to be aggressive this week as they assess holiday demand. Manufacturing will increase as more milk is available to the market as schools are closed.

BUTTER:

Monday's Cold Storage report is expected to show demand was good in November. There have been reports that inventory is building, but that may not be reflected on this report, but on the December report. Inventory is expected to show a decrease from October but higher than a year ago. Buyers may not be aggressive at the current price and may hold back on purchasing through the end of the year.

Friday Closing Dairy Market Update - Milk Futures Post Strong Gains

MILK:

Milk futures posted substantially higher prices. The January through April Class IV contracts moved back above $21.00 where they had not been since November 20. Class III futures rebounded due to being oversold while Class IV futures increased due to the strength of butter and the nonfat dry milk price. The bullish milk production report had some impact on the strength but buyers in the spot market did not purchase more aggressively because of the report. They purchased based on needs and are not interested in speculating whether the milk supply might tighten next year. The milk production report released on Thursday showed a significant revision in cow numbers for October. The USDA revised the October cow numbers up 5,000 head resulting in an increase in cow numbers from September of 24,000 head. Thus, the decline of 5,000 head from October was not bullish, but neutral. Cow numbers were 20,000 more than a year ago. Milk production in California declined 9.2 percent with cow number only down 1,000 head. The decline resulted from production per cow being down 175 pounds compared to a year ago.

AVERAGE CLASS III PRICES:

3 Month:	$19.37
6 Month:	$19.36
9 Month:	$19.23
12 Month:	$19.08

CHEESE:

For the week, blocks increased by 5.25 cents with 13 loads traded. The average price for the week was $1.85. Barrels increased by 3.25 cents with 11 loads traded. The average price was $1.7640. Dry whey decreased by 5.25 cents with 11 loads traded. The average price was 74.40 cents. Some had anticipated cheese buyers might be more aggressive today due to the decline of milk production in the November Milk Production report. However, that was not the case as buyers are doing business as needed. This milk had already been utilized in the market and did not result in any concern over the milk supply.

BUTTER:

For the week, butter increased by 9 cents with 19 loads traded. The average price for the week was $2.5190. Grade A nonfat dry milk increased by 1.50 cents with 15 loads traded. The average price was $1.3795. Butter moved to the highest price since November 15. Buyers remain cautious as the current fundamentals do not suggest the price will trend higher. The USDA will release the November Cold Storage report on Monday.

OUTSIDE MARKETS SUMMARY:

March corn closed up 5.50 cents per bushel at $4.4625, January soybeans closed up 11.50 cents at $9.7450 and March soybean meal closed up $11.20 per ton at $302.20. March Chicago wheat closed steady at $5.3300 and February live cattle closed up $1.85 at $188.40. February crude oil is up $0.16 per barrel at $69.54. The Dow Jones Industrial Average is up 498 points at 42,840 with the NASDAQ up 200 points at 19,573.

Friday Midday Dairy Market Summary - Milk Futures Rebound

OUTSIDE MARKETS SUMMARY:

CORN:	6 Higher
SOYBEANS:	14 Higher
SOYBEAN MEAL:	$9.90 Higher
LIVE CATTLE:	$1.17 Higher
DOW JONES:	642 Points Higher
NASDAQ:	279 Points Higher
CRUDE OIL:	$0.34 Higher

MIDDAY MARKET UPDATE:

The block cheese price slipped by 0.25 cent closing at $1.8525 with two loads traded. The barrel cheese price remained unchanged at $1.76 with four loads traded. No unfilled bids remained at the close with an offer for a load of blocks and offers for two loads of barrels. The dry whey price remained unchanged at 74 cents with one load traded. Class III futures are one cent lower to 48 cents higher. The only loss is in the nearby December contract. Futures are rebounding due to the market being overdone to the downside the past two days. The butter price increased 4.50 cents closing at $2.5550 with seven loads traded. Grade A nonfat dry milk increased by 1.75 cents closing at $1.3925 with eight loads traded. Class IV futures are 25 to 48 cents higher. Butter futures are 0.20 to 6.25 cents higher. Dry whey futures are steady to 2.00 cents lower.

November Milk Production in the United States down 1.0 Percent

November Milk Production down 0.8 Percent        

Milk production in the 24 major States during November totaled 17.2 billion pounds, down 0.8 percent from November 2023. October revised production, at 18.0 billion pounds, was up 0.6 percent from October 2023. The October revision represented an increase of 32 million pounds or 0.2 percent from last month's preliminary production estimate.  Production per cow in the 24 major States averaged 1,925 pounds for November, 22 pounds below November 2023.   The number of milk cows on farms in the 24 major States was 8.92 million head, 32,000 head more than November 2023, but 2,000 head less than October 2024.   

November Milk Production in the United States down 1.0 Percent  

Milk production in the United States during November totaled 17.9 billion pounds, down 1.0 percent from November 2023.  Production per cow in the United States averaged 1,909 pounds for November, 23 pounds below November 2023.  The number of milk cows on farms in the United States was 9.37 million head, 20,000 head more than November 2023, but 5,000 head less than October 2024. 

Friday Morning Dairy Market Update - Overnight Futures React to the Milk Production Report

OPENING CALLS:

Class III Milk Futures:	15 to 20 Higher
Class IV Milk Futures:	4 to 8 Higher
Butter Futures:	Steady to 1 Higher

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	2 to 3 Higher
Soybean Futures:	6 to 8 Higher
Soybean Meal Futures:	$4 to $5 Higher
Wheat Futures:	1 to 2 Higher

MILK:

The decline in milk production in November of 1.0% was unexpected and may change the outlook for milk prices moving into 2025. Milk production per cow declining by 23 pounds indicates the possible impact of bird flu is showing up. The bullish influence of this may be mitigated due to the time of year. Holiday demand has been filled and overall demand generally slows during the early part of the year. The long-term impact could be of greater significance. However, that may not support the market in the near term. Overnight Class III futures rebounded as anticipated due to the strength seen at the end of trading on Thursday after the markets had already been settled. Spot trading will be the key as to whether higher prices will hold.

CHEESE:

It is uncertain whether cheese buyers will step up Friday in response to the bullish implications of the milk production report. Their needs may be filled for now and limited interest in buying until lower prices are seen. Buyers and sellers of cheese are not interested in speculating on market direction. The milk from November has already been processed, stored or consumed, and has been factored into the physical market.

BUTTER:

The USDA will release the November Cold Storage report on Monday showing the inventory level of butter and other dairy products. Butter production has been strong and there have been reports that inventory has been increasing. This may not yet be reflected in the November report, but inventory is expected to have remained significantly higher than a year ago.

Thursday Closing Dairy Market Update - November Milk Production Declined 1%

MILK:

The November Milk Production report was rather bullish with milk production in the top 24 states down 0.8% from the previous year totaling 17.2 billion pounds. Milk production for October was revised higher to an increase of 0.6% from the previous year. Milk production per cow fell 22 pounds below November 2023 at 1,925 pounds. Cow numbers slipped 2,000 head from October. Milk production in the U.S. declined 1% from a year ago totaling 17.9 billion pounds. Milk production per cow averaged 1,909 pounds, down 23 pounds from November 2023. Cow numbers decreased by 5,000 head from October. The number of cows on farms totaled 9.37 million head, up 20,000 more than a year ago. The report is considered bullish as it seems to reflect the impact bird flu has had on milk production. California has been hit hard with the bird flu and this report reflects it. Milk production in the state was down 9.2% from November 2023, the largest year-over-year decline ever. Other Western states showed significant declines. New Mexico was down 5.4%, and Arizona was down 4.1%. There were 10 of the top 24 states that showed milk production declines from the previous year. Texas showed the largest gain of 7.3% followed by South Dakota, up 7.2%. Florida showed an increase of 4.8% with Iowa up 3.4%.

AVERAGE CLASS III PRICES:

3 Month:	$19.33
6 Month:	$19.27
9 Month:	$19.15
12 Month:	$19.01

CHEESE:

The bearishness of spot cheese trading was due to no buyers showing up to do any business during spot trading. Sellers tested the market to see where buyers might be willing to purchase but it seems that buyers have stepped back. It will be interesting to see whether buyers might be more aggressive after seeing the milk production report for November.

BUTTER:

The butter price is expected to remain choppy with limited upside price potential. Milk production in November was reported below a year earlier, but the cream supply has been higher than a year ago. USDA will release the November Cold Storage report on Monday showing the amount of butter stocks compared to a year ago.

OUTSIDE MARKETS SUMMARY:

March corn closed up 3.50 cents per bushel at $4.4075, January soybeans closed up 11.25 cents at $9.6300 and March soybean meal closed up $4.90 per ton at $291.00. March Chicago wheat closed down 8.25 cents at $5.3300. February live cattle closed down $1.78 at $186.55. February crude oil is down $0.80 per barrel at $69.22. The Dow Jones Industrial Average is up 15 points at 42,342 with the NASDAQ down 20 points at 19,373.

Fluid Milk and Cream - Western U.S. Report 51

For California, noted milk production differences for this week compared to last week are mixed. Some handlers in California indicate milk production is beginning to strengthen in recent weeks and slowly bounce back from lower than typical milk production over recent months leading up to December. That said, other handlers convey preliminary records indicate December 2024 year-over-year milk output to be down. Manufacturing capacity remains available, and spot loads of milk remain tight. Demands for all Classes are steady. According to the California Department of Water Resources, as of December 18, 2024, the current statewide snowpack total for the 2024-25 water year is above the benchmark in terms of the average amount as of December 18. 

Milk production in Arizona is strengthening. Spot load availability is in-line with recent weeks. All Class demands are steady. In New Mexico, farm level milk output is strengthening. Like its neighboring states, spot milk load availability is close to recent prior weeks. All Class manufacturing demands are steady. 

Handlers in the Pacific Northwest note steady or strengthening milk production. In terms of anticipated milk output, most handlers convey volumes are right on forecast. Some handlers note milder weather where farms are located is contributing to being on the plus side of forecasts. Demands for all Classes are steady. 

Farm level milk output in the mountain states of Idaho, Utah, and Colorado, varies from steady to stronger. Availability of spot milk loads is somewhat looser recently due to some unplanned down time at processing facilities in parts of the mountain states area. Class I and IV demands are steady. Class II and III demands vary from steady to lighter. Specifically regarding Class II demand from ice cream manufacturers, some stakeholders note demand during 2024 has been lighter in general. 

Cream loads remain readily available throughout most of the region. Demand varies from light to steady. Cream multiples moved lower for the bottom end of the Class II range. Both condensed skim milk availability and demand are mixed. 

Thursday Midday Dairy Market Summary - Class III Futures Take a Beating

OUTSIDE MARKETS SUMMARY:

CORN:	4 Higher
SOYBEANS:	10 Higher
SOYBEAN MEAL:	$5.00 Higher
LIVE CATTLE:	$0.97 Lower
DOW JONES:	281 Points Higher
NASDAQ:	104 Points Higher
CRUDE OIL:	$0.36 Lower

MIDDAY MARKET UPDATE:

The block cheese price declined by 0.50 cent closing at $1.8550 with no loads traded. The barrel price declined 2.50 cents closing at $1.76 with no loads traded. No buyers showed up during spot trading with an uncovered offer in each category. This increased the bearishness of the market. The dry whey price declined a penny, closing at 74 cents with one load traded. Class III futures are steady to 62 cents lower with January showing the greatest loss. The butter price remained unchanged at $2.51 with no loads traded. Grade A nonfat dry milk increased by 0.25 cent closing at $1.3750 with no loads traded. Class IV futures have not yet been traded. Butter futures are 0.20 -- 1.20 cents higher. Dry whey futures are steady to 2.20 cents lower. The USDA will release the November Milk Production report Thursday afternoon. I estimate milk production to be 0.4% above a year ago with cow numbers 3,000 more than October.

Thursday Morning Dairy Market Update - November Milk Production Report Today

OPENING CALLS:

Class III Milk Futures:	5 to 15 Lower
Class IV Milk Futures:	Mixed
Butter Futures:	Mixed

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	Steady to 1 Lower
Soybean Futures:	1 to 2 Higher
Soybean Meal Futures:	Mixed
Wheat Futures:	6 to 8 Lower

MILK:

The inability of spot cheese prices to increase on Thursday turned traders bearish with increased selling pressure through the end of the day. After the CME settled prices for the day further selling took place, pushing prices significantly lower. The CME settles prices for the day shortly after 2 p.m. CST, but trading continues until 4 p.m. CST. That is why closing prices can be much different than the final trading activity at the end of the day. Such was the case on Wednesday as Class III futures traded substantially lower into the close. That was reflected in overnight trade with contracts over 20 cents lower. Traders anticipated lower cheese prices and liquidated heavily. The USDA will release the November Milk Production report Thursday afternoon. I estimate milk production to be up 0.4% from a year ago with an increase of 3,000 cows from October.

CHEESE:

All eyes will be on spot cheese trading. Traders seem convinced cheese buyers have reached a threshold and will not bid higher. This could bring sellers into the market more aggressively as they try to take advantage of the higher prices. Volatility may be significant during and after spot trading.

BUTTER:

The butter price is expected to be choppy with little price direction. The price is expected to retest the low and possibly set a new low before the end of the year. Demand is good, but supply has been sufficient to satisfy the demand and to begin building inventory.

Wednesday Closing Dairy Market Update - Class III Futures Fell Lower in Continued Trading After the Market Settled

MILK:

It seems that traders threw in the towel as the afternoon progressed with Class III futures posting substantial losses despite cheese prices remaining unchanged. The January contract fell 67 cents at one point. No bearish news surfaced that provided such a negative impact as to trigger heavy liquidation of futures into the close of trading. It would not be surprising to see weakness in the spot market on Thursday as the lack of buyers for blocks may turn sellers aggressive. The main news today was that the Fed cut the interest rate by 0.25% which had been expected, and the Dow fell 1,123 points. Milk production continues to trend higher in most areas keeping bottlers and manufacturers supplied with milk. USDA will release the November Milk Production on Thursday. I estimate milk production to be 0.4% above a year ago. Cow numbers will not see the dramatic increase they did in October but may see an increase of 3,000 head from the previous month.

AVERAGE CLASS III PRICES:

3 Month:	$19.34
6 Month:	$19.28
9 Month:	$19.14
12 Month:	$19.02

CHEESE:

The inability of cheese prices to increase on the spot market sent a negative tone through Class III milk futures. Cheese futures took a hit with contracts 4-5 cents per pound lower. Traders turned increasingly bearish as the day progressed. Cheese prices were expected to have limited upside potential, but buyers have been aggressive as prices increased. The fear of higher prices increased buying activity becoming more psychological than fundamental. Spot milk prices are seeing the effects of the holiday season with prices up to $5.00 below class.

BUTTER:

Butter futures did not succumb to the pressure in some of the other markets with contracts showing gains across the board. Churning has been active with bulk butter supplies readily available. However, demand is reported to remain strong, which could limit the downside in price. The end of the year could bring slower demand with the price retesting the recent lows before the end of the year.

OUTSIDE MARKETS SUMMARY:

March corn closed down 6.25 cents per bushel at $4.3725, January soybeans closed down 25.00 cents at $9.5175 and January soybean meal closed down $7.70 per ton at $279.50. March Chicago wheat closed down 3.75 cents at $5.4125. February live cattle closed down $1.43 at $188.33. February crude oil is up $0.37 per barrel at $70.02. The Dow Jones Industrial Average is down 1,123 points at 42,326 with the NASDAQ down 716 points at 19,393.

Wednesday Midday Dairy Market Summary - Traders are Disappointed Over Cheese Prices

OUTSIDE MARKETS SUMMARY:

CORN:	5 Lower
SOYBEANS:	23 Lower
SOYBEAN MEAL:	$7.10 Lower
LIVE CATTLE:	$0.85 Lower
DOW JONES:	170 Points Higher
NASDAQ:	37 Points Higher
CRUDE OIL:	$0.61 Higher

MIDDAY MARKET UPDATE:

Cheese prices remained unchanged during spot trading with blocks remaining at $1.86 and barrels at $1.7850 with no loads traded. There were two uncovered offers for blocks with no buyers showing interest. There was an unfilled bid and an uncovered offer remaining for barrels. The lack of buying interest for blocks sets a negative tone in the market. The dry whey price increased 0.50 cent closing at 75 cents with three loads traded. Class III futures are 29 cents lower to 5 cents higher with only the July contract showing the gain. The butter price declined a penny closing at $2.51 with one load traded. There was an unfilled bid and three uncovered offers remaining at the close. Grade A nonfat dry milk declined by 0.75 cent closing at $1.3725 with six loads traded. Class IV futures are 2 to 15 cents higher. Butter futures are 1 cent lower to 2 cents higher. Dry whey futures are unchanged to 3 cents lower.

Wednesday Morning Dairy Market Update - Traders Show Caution Over Further Price Strength

OPENING CALLS:

Class III Milk Futures:	4 to 8 Lower
Class IV Milk Futures:	Mixed
Butter Futures:	Mixed

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	Steady to 1 Higher
Soybean Futures:	8 to 10 Lower
Soybean Meal Futures:	$2 to $3 Lower
Wheat Futures:	1 to 3 Higher

MILK:

Class III futures showed some selling pressure overnight as traders opted to take some quick profits from the market rather than guessing whether the underlying cash prices would remain supported. The current fundamentals do not suggest continued price strength for a long duration. There is no shortage of milk, but milk is not overwhelming the market. Spot milk prices are holding well for this time of year. The next few weeks may see lower spot prices as more milk will be available for processing due to schools being closed. However, manufacturing plants will absorb the extra milk without difficulty. Milk production in November is expected to have been higher than the previous year. The Milk Production report on Thursday will show the level of output for the month.

CHEESE:

The block cheese prices have increased nicely over the past two weeks, but may soon run out of strength. Once buyers have covered their current needs, there may be little interest in supporting the market at these levels. Prices are not expected to fall apart but will find a level that might increase demand.

BUTTER:

Butter is of greater concern than cheese. Inventory is higher than a year ago with some reports indicating inventory is currently increasing. This would be earlier than usual, but not unexpected due to abundant cream supplies keeping churns running on full schedules. The price is expected to revisit the recent lows before the end of the year.

Tuesday Closing Dairy Market Update - Most Milk Futures Contracts Show Losses

MILK:

Traders hesitated over buying milk futures aggressively as the recent increases may increase the selling interest of traders in the spot market. Holiday orders have been completed, reducing the need for buyers of cheese and butter to purchase to fill orders. It is too early for buyers to purchase ahead for next year as they do not want to build and pay for inventory this much in advance. Milk production is sufficient for demand. Bottling for school accounts has slowed with milk being diverted to manufacturing. Manufacturing plants will absorb the extra milk without difficulty. The bird flu had been anticipated to impact milk production significantly but has not tightened the market to the extent that there is a shortage of milk. The tight heifer supply was expected to reduce cow numbers and tighten the milk supply, but that has not had the impact it was thought to have. USDA will release the November Milk Production report on Thursday which will show us cow numbers, production per cow, and milk production for the month.

AVERAGE CLASS III PRICES:

3 Month:	$19.67
6 Month:	$19.62
9 Month:	$19.39
12 Month:	$19.23

CHEESE:

Block cheese has remained steady or increased for eight consecutive days with the price moving back to the highest level since October 30. The barrel cheese price has not followed the same pattern with consecutive price increases in the past two days. The price is back to the highest level since November 7. Traders are cautious over the upside price potential as holiday demand has been filled and supply is sufficient for fill-in orders and satisfy regular demand.

BUTTER:

There have been some reports that butter inventory is increasing. Demand has been good, but production has been strong due to the heavy cream supplies. Increased amounts of cream have been utilized for other holiday Class II products, alleviating some of the cream available for butter manufacturing. However, more will be available after the holidays keeping churns running at capacity and supply readily available to the market.

OUTSIDE MARKETS SUMMARY:

March corn closed down 1.50 cents per bushel at $4.4350, January soybeans closed down 5.25 cents at $9.7675 and January soybean meal closed up $.30 per ton at $287.20. March Chicago wheat closed down 5.00 cents at $5.4500. February live cattle closed down $0.23 at $189.75. January crude oil is down $0.63 per barrel at $70.08. The Dow Jones Industrial Average is down 268 points at 43,450 with the NASDAQ down 65 points at 20,109.

Tuesday Midday Dairy Market Summary - Milk Futures Show Weakness Despite Higher Cash

OUTSIDE MARKETS SUMMARY:

CORN:	3 Lower
SOYBEANS:	7 Lower
SOYBEAN MEAL:	$0.20 Higher
LIVE CATTLE:	$0.15 Higher
DOW JONES:	340 Points Lower
NASDAQ:	68 Points Lower
CRUDE OIL:	$0.96 Lower

MIDDAY MARKET UPDATE:

The block cheese price increased 3.75 cents closing at $2.52 with seven loads traded. The barrel cheese price increased by 5.50 cents closing at $1.7850 with four loads traded. There was an unfilled bid for a load of blocks and three uncovered offers remaining for barrels at the close. The dry whey price remained unchanged at 74.50 cents with no loads traded. Class III futures are mixed from 25 cents lower to 15 cents higher. Futures showed weakness after spot trading rather than following spot prices higher. The butter price increased 2 cents closing at $2.52 with one load traded. There was an unfilled bid and three uncovered offers remaining at the close. Nonfat dry milk increased 0.25 cent closing at $1.38 with one load traded. Class IV futures are mixed, ranging from 10 cents lower to 8 cents higher. Butter futures are 0.20 -- 1.65 cents higher. Dry whey futures are 0.50 cent lower to 0.75 cent higher.

Tuesday Morning Dairy Market Update - Cheese Prices May Reach Resistance

OPENING CALLS:

Class III Milk Futures:	Mixed
Class IV Milk Futures:	Mixed
Butter Futures:	Steady to 1 Higher

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	Steady to 1 Higher
Soybean Futures:	1 to 2 Lower
Soybean Meal Futures:	Steady to 1 Lower
Wheat Futures:	1 to 2 Higher

MILK:

The January and March Class III contracts closed at $20.30 and $20.00 respectively. The February contract was not far behind, closing at $19.97. That may be the level at which futures may hold if underlying cash prices remain choppy. There has been a steady increase in cheese prices recently, but it is not tied to a tighter supply or a surge in demand. Some of the buying resulted from increasing demand for fresh cheese, while some resulted from fear buying due to increasing prices. Milk supply is sufficient, but tighter than usual for this time of year spot milk prices still hold a premium to class in some areas. It certainly looks like the farm bill will be extended another year if economic assistance is also provided for farmers.

CHEESE:

Cheese prices have been increasing recently, but strength may be limited. There has been an increase in demand for fresh cheese, but it is expected to be temporary. Once the current buying interest is satisfied, it will settle down to regular demand. Cheese plants are running on full schedules with sufficient milk available. Buyers may not remain aggressive through the end of the year.

BUTTER:

The butter price is expected to remain choppy and likely to move to a new low before the end of the year. Buyers are confident about the supply and may remain less aggressive as demand generally slows after the holidays. Higher inventory will limit the upside price potential. 

Monday Closing Dairy Market Update - Cheese Prices May Be Nearing Resistance

MILK:

Interest in purchasing cheese and butter surfaced to begin the week. It is uncertain how much strength the market might have moving through the end of the year. Holiday demand has been met with some buying to increase ownership ahead of the new year. The milk supply is sufficient for demand and not overwhelming the market. More milk will be available for manufacturing through the end of the year as schools close for the Christmas holiday season. Plants will not have difficulty processing the extra milk, but it will move more products to inventory. This may limit the upside price potential for cheese and butter prices. Cheese has had a nice increase recently, improving the outlook for Class III milk prices. Whether these prices will hold through the first quarter of next year is questionable when demand generally diminishes.

AVERAGE CLASS III PRICES:

3 Month:	$19.68
6 Month:	$19.65
9 Month:	$19.43
12 Month:	$19.27

CHEESE:

The block cheese price has been steady or higher over the past seven consecutive days. Demand for fresh cheese has improved with some buying to replenish aging programs. Buying may have been more aggressive due to the steady increase in prices resulting in more buyers stepping into the market to purchase ahead of further price strength. The cheese inventory is below a year ago, but the supply is sufficient for all areas of demand.

BUTTER:

The increase in the butter price certainly was welcomed, but the bounce is expected to be short-lived with lower prices to unfold before the end of the year. Retail demand has increased but demand for food service remains subdued. Cream supply remains heavier than a year ago with plants having difficulty finding buyers for the extra cream they have available.

OUTSIDE MARKETS SUMMARY:

March corn closed up 3.00 cents per bushel at $4.4500, January soybeans closed down 6.25 cents at $9.8200 and January soybean meal closed up $.70 per ton at $286.90. March Chicago wheat closed down 2.25 cents at $5.5000. February live cattle closed down $2.05 at $189.98. January crude oil is down $0.75 per barrel at $70.54. The Dow Jones Industrial Average is down 111 points at 43,717 with the NASDAQ up 247 points at 20,174.

Monday Midday Dairy Market Summary - Dry Whey Price Falls Back

OUTSIDE MARKETS SUMMARY:

CORN:	3 Higher
SOYBEANS:	4 Lower
SOYBEAN MEAL:	$0.90 Lower
LIVE CATTLE:	$1.52 Lower
DOW JONES:	36 Points Lower
NASDAQ:	247 Points Higher
CRUDE OIL:	$0.27 Lower

MIDDAY MARKET UPDATE:

The block cheese price increased 2.25 cents closing at $1.8225 with four loads traded. The barrel cheese price increased by 0.25 cent closing at $1.73 with three loads traded. There was an unfilled bid each for blocks and barrels with two uncovered offers for barrels. The dry whey price took a hit declining 4.75 cents closing at 74.50 cents with six loads traded, and three uncovered offers remaining at the close. Traders are focusing more on the increase in cheese prices rather than the weakness of dry whey. Class III contracts are 15 cents lower to 31 cents higher with the gains in the January through April contracts. The butter price gained 3.50 cents closing at $2.50 with 10 loads traded. Grade A nonfat dry milk remained unchanged at $1.3775 with no loads traded. Class IV futures are mixed from 5 cents lower to 2 cents higher. Butter futures are 0.75 cent lower to 1.32 cents higher. Dry whey futures are steady to 2.40 cents lower.

Monday Morning Dairy Market Update - Traders Wait for Further Direction

OPENING CALLS:

Class III Milk Futures:	Mixed
Class IV Milk Futures:	2 to 5 Lower
Butter Futures:	Steady to 1 Lower

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	1 to 2 Higher
Soybean Futures:	2 to 3 Higher
Soybean Meal Futures:	$3 to $5 Higher
Wheat Futures:	3 to 4 Higher

MILK:

There is hope for further strength of the underlying cash markets to provide continued support to milk futures. However, that may be a tall order as the time for orders to be met before the holidays is running out. Most of the buying of cheese and butter will be for early next year. The current level of milk production should keep a sufficient supply of milk available for bottling and manufacturing. Bottling demand for school accounts will be slowing this week with greater volumes of milk diverted to manufacturing through the holidays. Steadily increasing milk production may leave limited upside potential for prices through the end of the year.

CHEESE:

The recent demand for fresh cheese has supported the market. Some of the support was due to increased orders to fill last-minute orders for the holidays, and some was due to low prices and buyers attempting to take advantage of those prices. That may have brought more buyers in from the sidelines as they saw prices increasing. The upside price potential may be limited due to sufficient supplies.

BUTTER:

The butter price is anticipated to see further weakness through the end of the year. Active churning and sufficient inventory leave buyers unaggressive. There is no concern over supply. The cream supply remains heavy with higher milk components adding to the supply.

Friday Closing Dairy Market Update - Dry Whey Posted Steady Gains Throughout the Week

MILK:

It has been a wild week for Class III milk futures with contracts moving above $20.00 only to fall back by the close of Friday. Underlying cash cheese prices did not fall apart today but the initial increase in the barrel cheese price before moving into negative territory became the focus of the trade. The strong gain of dry whey was unable to provide support. The positive aspect was that Class III futures closed significantly higher for the week. Trading activity is expected to be interesting and volatile through the end of the year. Milk production is slowly improving with production per cow increasing. It is unclear whether cow numbers have continued to increase in November following the strong increase in October. Class IV futures are struggling with most contracts closing at lower prices than a week ago. The price gap between Class III and Class IV narrowed significantly over the past week.

AVERAGE CLASS III PRICES:

3 Month:	$19.49
6 Month:	$19.47
9 Month:	$19.32
12 Month:	$19.18

CHEESE:

For the week, blocks jumped 10 cents with 14 loads traded. The weekly average price is $1.7595 compared to $1.6745 the previous week. Barrels gained 3.75 cents with 18 loads traded. The weekly average price is $1.7020 compared to $1.6510 the previous week. Dry whey gained 8.25 cents with seven loads traded. The weekly average price is 75.10 compared to 71.35 last week. Dry whey moved to a new high for this year four of the past five days. The price reached the highest level since February 23, 2022.

BUTTER:

For the week, butter fell 8 cents with 30 loads traded. The weekly average price is $2.5155 compared to $2.5285 last week. Price fell to a new low for this year and to the lowest level since December 14, 2023. If the price were to decline below $2.46, it would be back to the levels last seen since July 2023. The price is expected to see further weakness as holiday demand is filled and churning is very active utilizing the available cream. Grade A nonfat dry milk declined 1.50 cents with 20 loads traded. The weekly average price is $1.3815 compared to 1.3825 last week.

OUTSIDE MARKETS SUMMARY:

March corn closed down 1.50 cents per bushel at $4.4200, January soybeans closed down 7.50 cents at $9.8825 and January soybean meal closed down $3.30 per ton at $286.20. March Chicago wheat closed down 6.25 cents at $5.5225. February live cattle closed up $1.18 at $192.03. January crude oil is up $1.27 per barrel at $71.29. The Dow Jones Industrial Average is down 86 points at 43,828 with the NASDAQ up 24 points at 19,927.

Friday Morning Dairy Market Update - Milk Futures May Settle Back

OPENING CALLS:

Class III Milk Futures:	4 to 10 Lower
Class IV Milk Futures:	Mixed
Butter Futures:	Mixed

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	Mixed
Soybean Futures:	3 to 4 Lower
Soybean Meal Futures:	$2 to $3 Lower
Wheat Futures:	Mixed

MILK:

Traders had been day trading or scalping the market, and it was not surprising that overnight trading showed lower prices as traders exited their long positions after the large increase on Thursday. The strength in the underlying cash cheese prices seems tied to buying for the holidays and not due to a supply shortage. Cheese buyers may have been aggressive as they are now leap-frogging over each other attempting to purchase at a lower price before further increases occur. This aggressive buying may be short-lived. Milk is available with production increasing seasonally. It will be interesting to see if milk production per cow continued to improve in November. USDA will release the November Milk Production report next Thursday.

CHEESE:

The recent increase in cheese prices has been a surprise due to sufficient supply, but it has not been a surprise due to the time of year and increased demand for fresh cheese. The recent strength may be temporary, but will hopefully hold at a higher level. Further strength may be seen Friday.

BUTTER:

Butter for the holidays has been shipped with manufacturers looking ahead to first-quarter demand. There could be some price gains in the spot market as fill-in buying may take place, but time is running out. Reports have indicated that inventory is beginning to build due to strong butter output and heavy cream supplies. This would limit the upside price potential in the near term.

Thursday Closing Dairy Market Update - Class III Futures Close Above $20

MILK:

Class III milk futures regained all the losses since Oct. 22 with the largest one-day gains seen in nearby contracts in quite some time. This strength will only be maintained as long as cheese prices provide support. Fill-in buying for the holidays has been evident with strength in Class III contracts. The strong dry whey price provided support to Class III prices with the price reaching another new high for the year. Spot milk prices showed a wide range as the holiday season is nearby. Prices range from $3 under class to $2.50 over class. It is unusual for prices to be over class at this time. Some milk plants in the Central region report that milk levels are lower year over year for various reasons. The production of Class II products for the holidays has increased utilizing some of the available cream. If milk production closes the year at the current level projected by USDA, there will be two consecutive years of no production growth. It is uncertain whether that will be bullish for milk prices next year.

AVERAGE CLASS III PRICES:

3 Month:	$19.62
6 Month:	$19.62
9 Month:	$19.43
12 Month:	$19.30

CHEESE:

The industry has mixed feelings over the current supply and demand situation. There has been greater buying interest in cheese as the holiday season approaches. Some indicated demand has been sluggish recently. This could be due to cheese already having been purchased ahead with buyers showing limited interest. Overall demand for fresh cheese has improved recently providing support to the spot market. The recent price increase may have brought buyers off the sidelines as they want to purchase before prices increase further.

BUTTER:

Heavy cream supply keeps churns active and butter moving to the market and into inventory. Butter production has been higher than the previous year for 11 consecutive months. Production and inventory have been ample to satisfy demand. The price is struggling to maintain support and may retest the recent lows before the end of the year.

OUTSIDE MARKETS SUMMARY:

March corn closed down 4.75 cents per bushel at $4.4350, January soybeans closed up 0.25 cent at $9.9575, and January soybean meal closed down $1.60 per ton at $289.50. March Chicago wheat closed down 4.75 cents at $5.5850. February live cattle closed down $0.53 at $190.85. January crude oil is down $0.27 per barrel at $70.02. The Dow Jones Industrial Average is down 234 points at 43,914 with the NASDAQ down 132 points at 19,903.

Thursday Midday Dairy Market Update - Cheese Shows Further Strength

OUTSIDE MARKETS SUMMARY:

CORN:	5 Lower
SOYBEANS:	1 Lower
SOYBEAN MEAL:	$2.20 Lower
LIVE CATTLE:	$0.05 Lower
DOW JONES:	155 Points Lower
NASDAQ:	50 Points Lower
CRUDE OIL:	$0.07 Lower

MIDDAY MARKET UPDATE:

The block cheese price increased 3.75 cents, closing at $1.7875 with six loads traded. This is the highest price since Nov. 5. The barrel cheese price increased by 5.50 cents, closing at $1.73 with four loads traded. This is the highest price since Nov. 20. An unfilled bid and two uncovered offers for barrels remained at the close of spot trading. The dry whey price increased 1.75 cents, closing at 76.75 cents with no loads traded. This is another new high for the year. Class III futures are 5 cents lower to 62 cents higher with the only loss in the nearby December contract. The January through March contracts moved above $20.00. The butter price slipped 0.25 cent, closing at $2.5250 with no loads traded and no buyers showing up during the trading session. Nonfat dry milk declined by 0.50 cent, closing at 1.3775 with seven loads traded. Class IV futures are 8 to 15 cents higher. Butter futures are steady to 3.00 cents lower. Dry whey futures are 0.52 cent lower to 1.00 cents higher.

Fluid Milk and Cream - Western U.S. Report 50

Handlers in California indicate milk production varies from slightly weaker to slightly stronger this week compared to the week prior, but milk output is still down in terms of a year-over-year comparison by a significant percent. Stakeholders convey balancing plants are running at light paces compared to seasonal expectations. Manufacturing capacity is available, and spot loads of milk are tight. Demands for Class I and III are strong. Demands for Class II and IV are steady. According to the California Department of Water Resources, as of December 10, 2024, the state is slightly above the historical mean of 5.15 inches of precipitation for the current 2024-25 water year, at 5.22 inches. 

In Arizona, milk production is strengthening. However, stakeholders indicate spot milk load availability has not loosened much. All Class demands are steady. 

Farm level milk output in New Mexico is strengthening as well. Stakeholders indicate availability of spot milk loads remain more in line with its eastern neighbor state than its western neighbor state. Demands for all Classes are unchanged. 

For the Pacific Northwest, milk production is indicated to be steady this week compared to last week. Processors convey weather conditions are on the milder end of seasonal norms. All Class manufacturing demands are steady. 

In the mountain states of Idaho, Utah, and Colorado, farm level milk output is noted as steady or stronger. For Idaho, some processors indicate milk output is growing with some new dairies. Stakeholders convey snow totals in Idaho have not been very large thus far for the year. Manufacturers note milk volumes are comfortable. Class III demand is strong, while demands for all other Classes are steady. 

Cream loads are readily available for most of the West region. In some cases, sellers report finding a home for excess cream is not very easy. Cream multiples moved lower. Availability of condensed skim milk is comparatively snugger in the southwest part of the region. Condensed skim milk demand is mixed. 

Thursday Morning Dairy Market Update - Dry Whey May Show Further Strength

OPENING CALLS:

Class III Milk Futures:	2 to 5 Higher
Class IV Milk Futures:	Mixed
Butter Futures:	Mixed

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	1 to 2 Lower
Soybean Futures:	Mixed
Soybean Meal Futures:	Steady to 1 Lower
Wheat Futures:	1 to 2 Lower

MILK:

Class III milk futures found strength from the increase in the dry whey price. The price moved to the highest level for the year with further strength anticipated. This continues to provide support to the Class III complex. Traders may be cautious ahead of spot trading as the weakness of barrels is cause for concern. The news shows nothing for traders to take direction from. Milk production is slowly improving seasonally. Farmers are doing a good job of getting milk out of the cows. Component values have been higher than usual, improving cheese yields and increasing cream supplies. The milk supply is sufficient but not overwhelming the market.

CHEESE:

Cheese prices are expected to remain choppy as we move through the holidays and the end of the year. Buyers will be aggressive when needed and hold back once their needs are covered. Cheese inventory is lower than a year ago but current production is sufficient to meet the demand for fresh cheese. The upside price potential may be limited.

BUTTER:

The butter price is expected to remain in a range with the potential to retest the recent lows before the end of the year. Holiday orders have been met with some emphasis on contracting needs for the first quarter of 2025. Strong export demand has resulted from low prices and increased demand in the international markets. The U.S. butter price is very competitive on the world market.

Wednesday Closing Dairy Market Update - October Dairy Exports Declined 2.0%

MILK:

Class III milk futures struggled for much of the day with only nearby January and February contracts showing strength. Traders became a bit more aggressive as the day progressed with contracts throughout all of 2025 showing gains. The focus shifted from the decline of the barrel cheese prices to the increase of the dry whey price and the support it gave to the Class III prices. Futures prices for the first half of the year were $19.00 and higher during the day. The dry whey price moved to the highest level for the year and the highest since March 23, 2022. U.S. dairy exports in October declined 2.0%. The value of exports was $695.7 million and was 11% higher than a year ago. Year-to-date exports on a milk solids equivalent basis are 1% above a year ago with total export value also 1% lower than over the same period a year ago.

AVERAGE CLASS III PRICES:

3 Month:	$19.21
6 Month:	$19.29
9 Month:	$19.18
12 Month:	$19.11

CHEESE:

Year-to-date exports of cheese are 19.0% above the same period in 2023. October cheese exports totaled 40,282 metric tons or 12.4% above a year ago. October whey exports fell 12.1% to 39,807 metric tons from October 2023. Year-to-date exports of dry whey are 6.0% above the same period last year. Year-to-date exports of lactose are 9.0% below the same period in 2023.

BUTTER:

Butterfat exports jumped 95.6% in October compared to a year ago totaling 4,100 metric tons. Year-to-date exports were 18.6% over the same period last year. Nonfat dry milk/skim milk powder exports declined 4.3% in October to 61,926 metric tons. Year-to-date exports are 5.2% lower than the same period last year. Whole milk powder exports fell 32.2% in October to 1,449 metric tons. Year-over-year exports are down 7.2%.

OUTSIDE MARKETS SUMMARY:

March corn closed down 0.75 cent per bushel at $4.4825, January soybeans closed up 0.75 cent at $9.9550 and January soybean meal closed down $.90 per ton at $291.10. March Chicago wheat closed up 1.50 cents at $5.6325. February live cattle closed up $2.35 at $191.38. January crude oil is up $1.70 per barrel at $70.29. The Dow Jones Industrial Average is down 99 points at 44,149 with the NASDAQ up 348 points at 20,035.