MILK:
The volatile movement of the block cheese price was not influenced by any news or report. No one wanted to buy until the price dropped and then a buyer wanted to take advantage of the lower price. It was a matter of buyers and sellers doing business but with limited trading activity. The action increases the caution of traders substantially, driving some of them to the sidelines for a brief period. Cold weather in a large area of the nation may impact milk output to some extent, but it is not expected to significantly tighten supply. The February Class III contract moved the limit down for a time during the trading session as traders liquidated their long positions. Trading volume was moderate, with the February contract showing a little more than 600 contracts traded. Class IV futures showed very little activity, as is usual with lower prices.
AVERAGE CLASS III PRICES:
| 3 Month: | $19.98 |
| 6 Month: | $19.63 |
| 9 Month: | $19.47 |
| 12 Month: | $19.33 |
CHEESE:
The action of the cheese price left traders baffled and scrambling. Today's action may temper some of the trading interest ahead of spot trading on Wednesday. Cheese exports have been doing well with the November exports being the eleventh consecutive month of the year-over-year increases. Domestic demand is steady with cheese production following seasonal levels.
BUTTER:
Butter declined today but the recent trend remains higher. Manufacturers have sufficient supplies for current needs and to move to the market. This week has had 24 loads of butter traded on the spot market over the past two days. Buyers are willing to purchase loads but do not feel the need to become aggressive.
OUTSIDE MARKETS SUMMARY:
March corn closed down 2.00 cents per bushel at $4.7450, March soybeans closed down 5.50 cents at $10.4750 and March soybean meal closed down $2.00 per ton at $305.80. March Chicago wheat closed up 1.25 cents at $5.4625. February live cattle closed steady. February crude oil is down $0.74 per barrel at $78.08. The Dow Jones Industrial Average is up 221 points at 42,518 with the NASDAQ is down 44 points at 19,044.
