Friday Closing Dairy Market Update - Agricultural Prices Mixed Compared to the Previous Month

MILK:

The bleeding does not stop. The underlying cash prices provide no support to the market. Tariffs are going to be implemented on Mexico and Canada next week. The uncertainty of those tariffs leaves buyers of dairy products uncertain over demand. The current supply of milk is sufficient for bottling and manufacturing, with spot milk prices $2.50 below class-to-class. The USDA released the January Agricultural Prices report showing the average prices for most commodities. Some prices determine the income over feed price for the Dairy Margin Coverage program. The average corn price was $4.29, up $0.06 from December. This compares to $4.74 per bushel in January 2024. The premium/supreme hay price was $242.00 per ton, up $12.00 from December. This compares to $274.00 per ton a year ago. The All-milk price was $24.10, up $0.80 per cwt from December and up $4.00 from January 2024. The average soybean meal price will not be released until Monday, as that is not in this report. Some other prices of interest were the alfalfa price in January at $161.00 per ton, down $3.00 from December and down $41.00 per ton from a year ago. The soybean meal price was $10.00 per bushel compared to $9.79 in December and $12.80 in January 2024. The average price for milk cows was $2,660.00 compared to $1,890.00 a year ago.

AVERAGE CLASS III PRICES:

3 Month:	$19.08
6 Month:	$18.61
9 Month:	$18.56
12 Month:	$18.49

CHEESE:

For the week, blocks declined 12.50 cents, with 13 loads traded and a weekly average price of $1.8550. Barrels declined by 2 cents, with eight loads traded and a weekly average price of $1.7945. Dry whey declined 3.50 cents, with four loads traded and a weekly average price of 52.80 cents.

BUTTER:

For the week, butter declined 7 cents, with 33 loads traded and a weekly average price of $2.3480. Grade A nonfat dry milk declined 4 cents with 19 loads traded and a weekly average price of $1.2065. Abundant cream supplies will leave the upside price potential limited. Buyers continue to increase ownership as the price declines, reducing the need to become aggressive later in the year.

OUTSIDE MARKETS SUMMARY:

May corn closed down 11.50 cents per bushel at $4.6950, May soybeans closed down 11.50 cents at $10.2575 and May soybean meal closed steady at $300.20. May Chicago wheat closed down 6.75 cents at $5.5575. April live cattle closed down $3.48 at $192.65. April crude oil is down $0.59 per barrel at $69.76. The Dow Jones Industrial Average is up 601 points at 43,841 with the NASDAQ is up 303 points at 18,847.

Friday Midday Dairy Market Summary - Block Cheese Price Falls

OUTSIDE MARKETS SUMMARY:

CORN:	10 Lower
SOYBEANS:	8 Lower
SOYBEAN MEAL:	$0.20 Higher
LIVE CATTLE:	$1.67 Lower
DOW JONES:	49 Points Lower
NASDAQ:	54 Points Lower
CRUDE OIL:	$0.26 Lower

MIDDAY MARKET UPDATE:

The block cheese price fell 9.50 cents, closing at $1.7750 with four loads traded and three uncovered offers remaining at the close. This is the lowest price since Jan. 22. The barrel cheese price declined 2.50 cents, closing at $1.78 with two loads traded and one uncovered offer remaining. The dry whey price declined 1.50 cents, closing at 51.00 cents with no loads traded. The price is down to the lowest level since July 18, 2024. Buyers are not interested in aggressively purchasing despite the low prices. Class III futures are 30 cents lower to 2 cents higher. The only gain is the nearby February contract, which will go off the board on Tuesday. The butter price held steady at $2.3450 with no loads traded. Grade A nonfat dry milk remained unchanged at $1.20 with no loads traded. Class IV are unchanged. Butter futures are 0.77 cent lower to 3.02 cents higher. Dry whey futures are 1.05 cents lower to 0.25 cent higher. USDA will release the January Agricultural Prices report Friday afternoon.

Friday Morning Dairy Market Update - Mixed Spot and Futures Prices Anticipated

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

MILK:

Milk futures have not been able to recover from the negativity that has embraced the market over the past month. The initial announcement that tariffs would be put on Mexico and Canada at the beginning of February set a shock wave through the market. That was pushed back to the start of March. On Thursday, Feb. 27, there was a report that it would be delayed until April 2, but shortly after that, President Trump confirmed that it would begin on March 4. This keeps the market off balance and traders guessing of the impact it will have on dairy exports to these top buyers of U.S. dairy products. USDA will release the January Agricultural Prices report Friday afternoon, providing the average prices used to calculate income over feed.

CHEESE:

The trend for block cheese has been sideways while the barrel cheese price has been trending slightly lower. Blocks have been trading in the range they had been in during May through July 2024. Buyers are not being aggressive in the spot market as they are uncertain about demand. Even though inventory is below a year ago, sufficient supply is available.

BUTTER:

Buyers are purchasing what they need and what is being offered to the market. They have not had to chase the price higher. There have been 33 loads of butter traded on the spot market this week. Sellers continue to offer supply to limit the increase of inventory. Buyers purchase and store for later demand at the low prices. The ownership changes hands, but inventory continues to build.

Thursday Closing Dairy Market Update - Traders Find Little Price Direction

MILK:

It is interesting that there have been reports of processors having difficulty finding milk for processing due to the tight spot market. However, spot milk prices this week are reported at $2.50 under class to class. This does not indicate milk supplies are tight but may be due to locations seeing greater buying interest for available spot milk. Many plants have positioned themselves as net buyers of milk, and now that they would like to purchase extra milk, there is an insufficient supply in the area to satisfy the demand. They are competing against each other. However, the overall milk supply is sufficient for demand with extra available. Fluid milk demand has been steady and improving. Commercial disappearance of dairy products remains 0.5% below a year ago.

AVERAGE CLASS III PRICES:

3 Month:	$19.24
6 Month:	$18.78
9 Month:	$18.71
12 Month:	$18.62

CHEESE:

Cheese demand is termed as steady with demand for some varieties improving. Food service demand is variable and not as strong as usual for this time of year. Barrel supplies are readily available, leaving buyers less aggressive. Some plants indicate milk receipts are increasing as evidence of early spring flush is seen. However, most areas have seen milk production remaining generally steady. Spot cheese prices seem to be in a range and may stay that way in the near term.

BUTTER:

The minor increase in the butter price does not mean much, as it is likely just business being done. There is sufficient supply for demand with inventory increasing more rapidly than usual. Cream supplies remain heavy with plants running full schedules to process the available cream. This will limit the upside price potential for a while. Class IV futures may continue to struggle under the weakness of butter and nonfat dry milk.

OUTSIDE MARKETS SUMMARY:

May corn closed down 12.50 cents per bushel at $4.8100, May soybeans closed down 4.00 cents at $10.3725 and May soybean meal closed down $2.30 per ton at $300.20. May Chicago wheat closed down 17.25 cents at $5.6250. April live cattle closed up $1.50 at $196.13. April crude oil is up $1.46 per barrel at $70.08. The Dow Jones Industrial Average is down 194 points at 43,240 with the NASDAQ down 531 points at 18,544.

Thursday Midday Dairy Market Summary - Spot Prices Were Mixed

OUTSIDE MARKETS SUMMARY:

CORN:	13 Lower
SOYBEANS:	Steady
SOYBEAN MEAL:	$1.00 Lower
LIVE CATTLE:	$0.85 Higher
DOW JONES:	285 Points Higher
NASDAQ:	102 Points Lower
CRUDE OIL:	$1.81 Higher

MIDDAY MARKET UPDATE:

The block cheese price remained unchanged at $1.87 with five loads traded. The price decreased 0.25 cent during trading but recovered the loss. The barrel cheese price increased a penny, closing at $1.8050 with one load traded. The dry whey price decreased a penny, closing at 52.50 with two loads traded. The gain in barrel cheese was offset by the decline in dry whey. However, Class III futures are 1 to 25 cents higher as traders feel the market has been overdone to the downside. The butter price increased a penny, closing at $2.3450 with five loads traded. The price declined 0.25 cents before buying interest moved it off the low. Nonfat dry milk declined 0.75 cent, closing at $1.20 with one load traded. Class IV futures are 12 to 19 cents lower. Butter futures are 0.50 cent lower to 0.47 cent higher. Dry whey futures are 0.25 to 1.47 cents higher.

Fluid Milk and Cream - Western U.S. Report 7

Week-over-week differences in milk production continue to be positive for California. However, stakeholder notes concerning preliminary February 2025 year-over-year milk production are mixed. In a few cases, February 2025 year-over-year milk production gaps are indicated to be increasing further. However, in most cases, February 2025 year-over-year milk production gaps are indicated to be decreasing. In terms of herd sizes, a few industry participants convey their herd sizes haven't fully recovered. Demands for all Classes are steady. 

For Arizona, farm level milk output is seasonally stronger. However, some stakeholders express uncertainty about what effects near-term herd health challenges will have on milk output for the state. Demands for all Classes are unchanged.

Milk production in New Mexico is seasonally strengthening in line with anticipated paces. All Class demands are steady. 

For the Pacific Northwest, week-overweek milk production is generally increasing. However, a few handlers convey milk volumes are below anticipated amounts recently. That said, milk volumes are sufficiently accommodating needs of manufacturers. Class I, II, III, and IV demands are steady. 

In the mountain states of Idaho, Utah, and Colorado farm level milk output is seasonally stronger. handlers note milk output to be in line with or above anticipated volumes. Idaho and Utah manufacturers describe milk volumes as in good balance with processing capacities, but also not difficult to find a buyer for if need be. All manufacturing Class demands are steady. 

Cream volumes remain heavy in the region. Cream multiples moved lower this week. Distressed cream load offers were reported at cream multiples below the bottom-end of the All-Classes range for the West. Cream demand is mixed. Condensed skim milk availability and demand are steady.

Thursday Morning Dairy Market Update - Milk Futures May Bounce

OPENING CALLS:

Class III Milk Futures:	8 to 12 Higher
Class IV Milk Futures:	2 to 5 Lower
Butter Futures:	Mixed

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	Steady to 1 Lower
Soybean Futures:	3 to 5 Higher
Soybean Meal Futures:	Steady to $1 Higher
Wheat Futures:	3 to 5 Lower

MILK:

It may be difficult for milk futures to regain much of the losses over the past month. Underlying cash prices have not found stability as supply remains readily available for demand. Milk receipts are increasing as cow comfort and feed intakes have improved. Component values in the milk remain exceptional and at record-high levels. This improves cheese yield and provides ample cream for butter production. The proposed tariffs on Mexico and Canada have been pushed back to April 2. This provides more time for negotiations that could result in tariffs not being implemented.

CHEESE:

The January Cold Storage report was neutral for cheese. The growth of inventory was light and remains below a year ago. This may provide stability to cheese prices. However, buyers see no need to be aggressive as there is sufficient supply for demand.

BUTTER:

The inventory increase of 56.0 million pounds of butter in storage was an unusually high increase for January. This has already been factored into the market and may not put further pressure on the market. The current weakness is the result of current production and the level of demand. Churning remains active and supply is sufficient.

Wednesday Closing Dairy Market Update - December Fluid Milk Sales Increase 2.4%

MILK:

Milk futures continue to make new lows on nearly a daily basis. The March Class III contract closed at the lowest level since Aug. 23, 2024. The June contract fell below $18.00 during the day. Class IV futures have been more bearish with the March futures contract falling to the lower level since Feb. 29, 2024. Butter and nonfat dry milk prices have declined further than cheese and dry whey prices. December fluid milk sales we 2.4% higher than a year ago. Whole milk sales increased 2.9%; flavored whole milk sales jumped 12.3%; reduced fat decreased 3.4%; low fat milk decreased 3.4%; fat-free skim declined 8.0%; flavored fat-reduced milk sales decreased 0.7%; buttermilk sales increased 3.5% with other fluid milk products up 49.8%. Organic whole milk sales increased 17.7%; organic flavored while milk sales jumped 40.8%; organic reduced fat increased 7.6%; organic low-fat milk decreased 5.0%; organic fat-free sales declined 6.0%; organic flavored fat-reduced milk fell 34.5%; with other organic fluid milk sales up 23.9%.

AVERAGE CLASS III PRICES:

3 Month:	$19.10
6 Month:	$18.68
9 Month:	$18.65
12 Month:	$18.57

CHEESE:

Cheese prices have not been moving much, but the inability of prices to increase continues to be negative on the market. The barrel cheese price is trending lower with the barrel supply readily available for demand. Blocks show better support, but supply is sufficient for demand. Spot milk is difficult to find due to plants positioning themselves as net buyers. This has more plants looking for available spot milk, keeping prices higher.

BUTTER:

The butter price moved to a new low for the year as buyers wait for lower prices. The only bid during spot trading today was $2.20. This is a concern as many times the closest bid being low at a significantly lower price indicates that is where the nearest support may be. We hope the price will not move to that level, but we certainly cannot rule that out in the current market environment.

OUTSIDE MARKETS SUMMARY:

May corn closed down 2.75 cents per bushel at $4.9425, March soybeans closed up 2.25 cents at $10.3125 and May soybean meal closed up $2.10 per ton at $303.00. May Chicago wheat closed down 5.75 cents at $5.8775. April live cattle closed up $0.63 at $195.73. April crude oil is down $1.77 per barrel at $68.93. The Dow Jones Industrial Average is up 160 points at 43,621 with the NASDAQ down 261 points at 19,026.

Wednesday Midday Dairy Market Update - Butter Shows More Weakness

OUTSIDE MARKETS SUMMARY:

CORN:	1 Lower
SOYBEANS:	7 Lower
SOYBEAN MEAL:	$0.90 Lower
LIVE CATTLE:	$0.55 Lower
DOW JONES:	170 Points Lower
NASDAQ:	13 Points Higher
CRUDE OIL:	$0.16 Lower

MIDDAY MARKET UPDATE:

The block cheese price declined a penny closing at $1.87 with one load traded. The barrel cheese price increased by 0.25 cent closing at $1.7950 with no loads traded. The dry whey price remained steady at 53.50 cents with no loads traded. Class III futures are mixed with the February through May contracts higher and later contracts lower. The butter price slipped a penny closing at $2.3350 with 26 loads traded. Grade A nonfat dry milk increased 0.75 cents closing at $1.2075 with six loads traded. Class IV futures are 10 to 14 cents lower. Butter futures are 0.05 to 4.00 cents lower. Dry whey futures are unchanged to 0.57 cent lower. The USDA will release the January Cold Storage report Wednesday afternoon.

Wednesday Morning Dairy Market Summary - Cold Storage Report Today

OPENING CALLS:

Class III Milk Futures:	Mixed
Class IV Milk Futures:	4 to 8 Lower
Butter Futures:	Steady to 1 Lower

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	Mixed
Soybean Futures:	4 to 6 Lower
Soybean Meal Futures:	$1 to $2 Lower
Wheat Futures:	1 to 2 Lower

MILK:

Milk futures have been unable to find a bottom and have not even been able to bounce over the past few weeks. Class IV futures have shown greater weakness than Class III. Even if underlying cash shows strength, traders may cover some short positions. They might not buy into the market as the upside price potential may be limited unless underlying cash prices develop a higher trend. It is not that there is an overabundance of milk, but a decrease in demand compared to a year ago. Milk production is sufficient for demand and being higher in January than a year ago may indicate further gains over the next months.

CHEESE:

The block cheese price has maintained a sideways range while barrels have been trending lower. Buyers have not been aggressive as they do not want to build inventory too early as they are uncertain about demand. Much of the buying is being done on an as-needed basis. Cheese inventory is expected to have increased in January. The January Cold Storage report will show how much.

BUTTER:

It is uncertain where support is in the butter price. The low bid of $2.20 during spot trading on Tuesday is cause for concern. There was no interest in buying any higher. This may have just been due to limited interest in the spot market for the day, but it could also indicate the next level of support. Buyers may step in at higher levels to purchase supply to increase ownership in case supply tightens as the year progresses.

Tuesday Closing Dairy Market Update - December Fluid Milk Sales Increase 2.4%

MILK:

Milk futures continue to make new lows on nearly a daily basis. The March Class III contract closed at the lowest level since Aug. 23, 2024. The June contract fell below $18.00 during the day. Class IV futures have been more bearish with the March futures contract falling to the lower level since Feb. 29, 2024. Butter and nonfat dry milk prices have declined further than cheese and dry whey prices. December fluid milk sales we 2.4% higher than a year ago. Whole milk sales increased 2.9%; flavored whole milk sales jumped 12.3%; reduced fat decreased 3.4%; low fat milk decreased 3.4%; fat-free skim declined 8.0%; flavored fat-reduced milk sales decreased 0.7%; buttermilk sales increased 3.5% with other fluid milk products up 49.8%. Organic whole milk sales increased 17.7%; organic flavored while milk sales jumped 40.8%; organic reduced fat increased 7.6%; organic low-fat milk decreased 5.0%; organic fat-free sales declined 6.0%; organic flavored fat-reduced milk fell 34.5%; with other organic fluid milk sales up 23.9%.

AVERAGE CLASS III PRICES:

3 Month:	$19.10
6 Month:	$18.68
9 Month:	$18.65
12 Month:	$18.57

CHEESE:

Cheese prices have not been moving much, but the inability of prices to increase continues to be negative on the market. The barrel cheese price is trending lower with the barrel supply readily available for demand. Blocks show better support, but supply is sufficient for demand. Spot milk is difficult to find due to plants positioning themselves as net buyers. This has more plants looking for available spot milk, keeping prices higher.

BUTTER:

The butter price moved to a new low for the year as buyers wait for lower prices. The only bid during spot trading today was $2.20. This is a concern as many times the closest bid being low at a significantly lower price indicates that is where the nearest support may be. We hope the price will not move to that level, but we certainly cannot rule that out in the current market environment.

OUTSIDE MARKETS SUMMARY:

May corn closed down 2.75 cents per bushel at $4.9425, March soybeans closed up 2.25 cents at $10.3125 and May soybean meal closed up $2.10 per ton at $303.00. May Chicago wheat closed down 5.75 cents at $5.8775. April live cattle closed up $0.63 at $195.73. April crude oil is down $1.77 per barrel at $68.93. The Dow Jones Industrial Average is up 160 points at 43,621 with the NASDAQ down 261 points at 19,026.

Tuesday Midday Dairy Market Summary - Nonfat Dry Milk Continues to Decline

OUTSIDE MARKETS SUMMARY:

CORN:	4 Lower
SOYBEANS:	2 Higher
SOYBEAN MEAL:	$1.70 Higher
LIVE CATTLE:	$0.62 Higher
DOW JONES:	171 Points Higher
NASDAQ:	183 Points Lower
CRUDE OIL:	$1.85 Lower

MIDDAY MARKET UPDATE:

The block cheese price remained unchanged at 1.88 with no loads traded. The barrel cheese price declined 0.75 cents closing at $1.7925 with no loads traded. There was an offer for a load of blocks and two loads of barrels remaining at the close. This is concerning as buyers remain sidelined waiting for lower prices. The dry whey price remained unchanged at 53.50 cents with no loads traded. Class III futures are 2 to 24 cents lower with March showing the greatest decline. The butter prices declined 2.50 cents closing at $2.3450 with no loads traded. There was an unfilled bid posted way down at $2.20 with six uncovered offers remaining at the close. The low bid may indicate the price has further downside potential before finding support. Nonfat dry milk declined 2.50 cents closing at $1.20 with 10 loads traded. This is the lowest price since Aug. 9, 2024. Class IV futures are 24 to 34 cents lower. Butter futures are 1.45 to 3.75 cents lower. Dry whey futures are unchanged to 1.00 cents lower.

Tuesday Morning Dairy Market Update - Milk Futures Lower Overnight

OPENING CALLS:

Class III Milk Futures:	6 to 12 Lower
Class IV Milk Futures:	4 to 8 Lower
Butter Futures:	1 to 2 Lower

OUTSIDE MARKET OPENING CALLS:

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

MILK:

Milk futures were lower on Monday with Class IV futures showing greater weakness than Class III. The weakness continued overnight with Class III contracts 1 to 14 cents lower. The continued weakness of underlying cash is putting pressure on the market. Milk production in January was slightly higher than a year ago putting some pressure on the market. Further pressure stems from the sufficient supply of milk for demand. The USDA will release the January Cold Storage report on Wednesday, Feb. 26. The report will show the level of inventory growth, which will provide an idea of demand. Spot milk is difficult to find, but plants have sufficient for needs.

CHEESE:

The block cheese price remains in a sideways pattern while barrels are trending lower. Buyers have not felt the need to purchase aggressively for potential demand as the level of demand is uncertain in the near term. Until the supply of cheese tightens, prices will continue to chop around.

BUTTER:

The butter price moved to the lowest level since June 21, 2023. Further weakness is possible as buyers anticipate lower prices and see no need to be aggressive. They have been purchasing supplies on the weakness, building inventory for later demand without chasing the market.

Monday Closing Dairy Market Update - More States Show Milk Production Gains

MILK:

Numerous Class IV contracts closed with double-digit losses. Some nearby contracts have fallen to the lowest level in about a year. The weakness of nonfat dry milk has been the anchor on the market, and the price has not yet found a bottom. Class III futures have not been able to find support as the weakness of dry whey keeps pressure on the market. The January Milk Production report indicated nine of the top 24 states showed a decline in milk production from a year ago. More states showed production increases than in December. California showed the largest decrease of 5.7%, followed by Arizona, down 4.1%. Virginia declined 3.3%; Washington declined 2.9%; Illinois declined 2.7%; New Mexico declined 1.2%; Florida declined 1.1%; Wisconsin declined 0.6%; Minnesota declined 0.2%. Bird flu continues to impact California, but the loss is becoming less as the months progress. The states with the greatest production increases have been South Dakota and Texas, with a gain of 6.5% each. Idaho showed a production gain of 6.4% from a year earlier. Kansas was up 4.3% and Colorado was up 3.6%. Other states that showed gains were 2.0% or less.

AVERAGE CLASS III PRICES:

3 Month:	$19.25
6 Month:	$18.86
9 Month:	$18.80
12 Month:	$18.71

CHEESE:

Cheese prices continue to move in a range. Buyers are not anxious about purchasing cheese for future demand. This time of year is generally slower for demand, but this year buyers are extremely cautious as they are uncertain about demand for the foreseeable future. The commercial disappearance of dairy products is running about 0.55% below a year ago. That may not change anytime soon as the consumer price index continues to increase due to higher food costs, leaving less disposable income.

BUTTER:

The butter price moved to a new low for the year and may now move to and below the lowest price in 2023. Buyers could be more aggressive at the lower price, but each time the price bounced, it resulted in the price moving to a new low. Abundant cream supplies keep butter production strong and supply readily available.

OUTSIDE MARKETS SUMMARY:

March corn closed down 8.75 cents per bushel at $4.8250, March soybeans closed down 10.50 cents at $10.2900 and May soybean meal closed down $3.00 per ton at $300.90. May Chicago wheat closed down 10.50 cents at $5.9350. April live cattle closed up $1.15 at $195.10. April crude oil is up $0.45 per barrel at $70.85. The Dow Jones Industrial Average is up 33 points at 43,461 with the NASDAQ is down 237 points at 19,287.

Monday Midday Dairy Market Summary - Spot Prices Decline

OUTSIDE MARKETS SUMMARY:

CORN:	9 Lower
SOYBEANS:	9 Lower
SOYBEAN MEAL:	$2.40 Lower
LIVE CATTLE:	$1.02 Higher
DOW JONES:	200 Points Higher
NASDAQ:	43 Points Lower
CRUDE OIL:	$0.34 Higher

MIDDAY MARKET UPDATE:

The block cheese price declined 2 cents closing at $1.88 with three loads traded. The barrel cheese price remained unchanged at $1.80 with five loads traded and three uncovered offers remaining at the close. The dry whey price declined a penny closing at 53.50 cents with two loads traded. Class III futures are 12 cents lower to 2 cents higher. The butter price declined 4.50 cents closing at $2.37 with two loads traded. There was an unfilled bid and an uncovered offer remaining at the close. This is a new low for the year. Buyers are holding back anticipating further weakness, which may result in lower prices. Grade A nonfat dry milk declined 1.50 cents closing at $1.2250 with two loads traded. This is a new low for the year and the lowest price since Aug. 12, 2024. Class IV futures have not yet been traded. Butter futures are steady to 2.70 cents lower. Dry whey futures are 0.85 cent lower to 0.25 cent higher.

Monday Morning Dairy Market Update - Mixed Reaction to the Milk Production Report

OPENING CALLS:

Class III Milk Futures:	Mixed
Class IV Milk Futures:	2 to 4 Lower
Butter Futures:	Steady to 1 Lower

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	3 to 5 Lower
Soybean Futures:	4 to 6 Lower
Soybean Meal Futures:	$1 to $2 Lower
Wheat Futures:	8 to 10 Lower

MILK:

U.S. milk production up by 0.1% from January 2024 was unexpected and may keep the milk price potential limited. The 24-state increase was 0.2% with 9,000 more cows than in December. This may be factored in and a reason why overnight trade did not show significant price pressure. Production per cow in the U.S. was 7 pounds lower, but cow numbers were 41,000 head higher. We are heading toward spring flush, which could show an increase in milk production with the higher cow numbers. Milk futures may remain under pressure due to the continued weakness of dry whey and nonfat dry milk. The January Cold Storage report will be released on Wednesday, Feb. 26.

CHEESE:

Cheese prices are expected to remain choppy as buyers see no need to be aggressive. Cheese demand has increased in some areas depending on variety, but overall demand remains lower than a year ago. Inventory is seasonally increasing but may not increase as much as usual.

BUTTER:

The butter price is expected to continue to chop around as buyers and sellers do business at the current price level. Butter inventory is increasing, which will limit upside price potential. Buyers have been able to purchase a good amount of butter recently on the spot market, which may reduce their aggressiveness later in the year.

Friday Closing Dairy Market Update - 2024 Milk Production Lower, But Herd Size Growing

MILK:

Class III milk futures lost over 80 cents on the March contract this week, while Class IV lost over $1.40 from this time last week. We have seen a steady downtrend over the last few weeks. The January Milk Production report released on Friday painted a story of why we are trending lower. Even though 2024 was 0.2% lower on production at 226 billion pounds, a reduction of 53 million pounds, the herd size is growing rapidly. We had 54,000 head more milk cows in 2024 than last year, totaling 8.93 million head. What is more telling is the increase of 9,000 more cows just from December to January. The production per cow decreased, most likely due to the new influx of heifers to the herd to 2,054 pounds per cow, down 8 pounds from last year.

For January, we saw an increase in production of 0.2%, totaling 18.3 billion pounds of milk. The December revised production of 18.0 billion pounds was down 0.2% from December 2023. The December revision represented no change from last month's estimate.

AVERAGE CLASS III PRICES:

3 Month:	$19.48
6 Month:	$19.06
9 Month:	$18.95
12 Month:	$18.81

CHEESE:

For the week, blocks decreased 2 cents with three loads traded. Barrels decreased by 1.75 cents with five loads traded. Dry whey declined 1 cent with no loads traded. This was another new low for the year. The weakness in cheese and dry whey were highlighted by the trend lower for the week in Class III and IV futures as outlined above.

BUTTER:

For the week, butter increased by 3.75 cents with 36 loads traded. Grade A nonfat dry milk declined by 4 cents with only two loads traded. The weakness of nonfat dry milk kept pressure on Class IV futures, trending lower for the week. This is another new low for the year in both Class IV and Grade A nonfat dry milk.

OUTSIDE MARKETS SUMMARY:

March corn closed down 6.75 cents per bushel at $4.9125, March soybeans closed down 6 cents at $1039.50 and March soybean meal closed down $1.20 per ton at $294.80. March Chicago wheat closed up 4.5 cents at $5.90. April live cattle closed up $0.15 at $193.95. March crude oil was down $2.27 per barrel at $70.21. The Dow Jones Industrial Average was down 748 points at 43,428, with the NASDAQ down 438 points at 19,524.

January Milk Production up 0.2 percent

January Milk Production up 0.2 percent 

Milk production in the 24 major States during January totaled 18.3 billion pounds, up 0.2 percent from January 2024. December revised production, at 18.0 billion pounds, was down 0.2 percent from December 2023.  The December revision represented no change from last month's preliminary production estimate. Production per cow in the 24 major States averaged 2,054 pounds for January, 8 pounds below January 2024.  The number of milk cows on farms in the 24 major States was 8.93 million head, up 54,000 head from January 2024, and up 9,000 head from December 2024. 

2024 Annual Milk Production down 0.2 percent from 2023 

The annual production of milk for the United States during 2024 was 226 billion pounds, down 0.2 percent from 2023. Revisions to 2023 production decreased the annual total 53 million pounds. Revised 2024 production was up 14 million pounds from last month's publication. Annual total milk production has increased 8.3 percent from 2015. Production per cow in the United States averaged 24,178 pounds for 2024, 61 pounds above 2023. The average annual rate of milk production per cow has increased 8.1 percent from 2015. The average number of milk cows on farms in the United States during 2024 was 9.34 million head, down 42,000 head from 2023. The average number of milk cows was revised up 3,000 head for 2024. The average annual number of milk cows has increased 0.2 percent from 2015. 

Friday Midday Dairy Market Summary - Mixed Markets Ahead of January Milk Production Report

OUTSIDE MARKETS SUMMARY:

CORN:	5 Lower
SOYBEANS:	6 Lower
SOYBEAN MEAL:	$0.11 Lower
LIVE CATTLE:	$0.25 Higher
DOW JONES:	632 Points Lower
NASDAQ:	326 Points Lower
CRUDE OIL:	$1.57 Lower

MIDDAY MARKET UPDATE:

The block cheese price was unchanged, settling at $1.90 with no loads traded. The barrel cheese price gained 1.50 cents closing at $1.80 with two loads traded. The dry whey price remained unchanged, closing at $0.5450 with no loads traded yet again Friday. Class III futures are currently trading 10 to 19 cents lower. The butter price fell 0.75 cents, closing at $2.4150 with five loads traded. Grade A nonfat dry milk is 1 cent lower at $1.24 with one load traded. Class IV futures have not yet traded Friday. Butter futures are 0.325 cents lower to 0.250 cents higher. Dry whey futures are 0.75 to 1.9 cents lower.

 

Friday Morning Dairy Market Update - January Milk Production Report Will Be Released

OPENING CALLS:

Class III Milk Futures:	4 to 8 Lower
Class IV Milk Futures:	3 to 6 Lower
Butter Futures:	Steady to 1 Lower

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	Mixed
Soybean Futures:	Mixed
Soybean Meal Futures:	Steady to $1 Lower
Wheat Futures:	3 to 4 Higher

MILK:

Class III futures showed minor gains despite the weakness of the barrel cheese price. Futures were overdone to the downside on Wednesday, already having the weakness factored in. The USDA will release the January Milk Production report Friday afternoon. Milk production is expected to remain below a year ago. Cow numbers are estimated to be about even with the previous month. Milk production in California will be the subject of interest due to the significant impact of bird flu on dairy farms. Traders will be cautious ahead of spot trading as prices remain weak.

CHEESE:

The barrel cheese price is trending lower. Barrel cheese supplies are more available than blocks for the time being. Overall cheese production is holding, but American cheese output continues to run below a year ago. There has been a greater emphasis on the Italian type and other cheese varieties that have been increasing in demand.

BUTTER:

The butter prices may see further weakness as buyers may step back from the market again to let the price decline. There have been 33 loads of butter traded over the past three days. The concern is the weakness of Grade A nonfat dry milk. The price has declined to the lowest level since Aug. 15, 2024. The price has fallen by 15.50 cents from its peak in November.

Thursday Closing Dairy Market Update - Milk Seeks Support

MILK:

Class III milk futures were higher today, closing anywhere from 2 to 17 cents lower, losing some ground after early-day strength. Class IV futures had limited trading volume today, closing unchanged. The January Milk Production report will be released tomorrow. Most traders are expecting to see lower production than last year.

AVERAGE CLASS III PRICES:

3 Month:	$19.40
6 Month:	$19.00
9 Month:	$18.89
12 Month:	$18.76

CHEESE:

Cheese found some support today after a disappointing start to the week, closing 0.2 cents to 1.9 cents higher today. The cash market was mixed, with blocks trading slightly higher and barrels trading 2.25 cents lower. There is still tariff concern, but there is more than a week before the next set of tariffs will be decided for Mexico and Canada.

BUTTER:

Butter futures were mixed today after a great start to the week. With the limited trading in Class IV milk futures, we lacked direction to continue the rally. Most buyers are looking for deals and willing to stock freezers if prices are right, but there will be a tipping point where they can be patient on securing more product.

OUTSIDE MARKETS SUMMARY:

March corn closed 0.5 cents per bushel higher at $4.98, March soybeans closed 13.5 cents higher at $10.4550 and March soybean meal closed up $1.01 per ton at $296.00. March Chicago wheat closed down 6.5 cents at $5.854. April live cattle closed down $0.975 at $193.80. March crude oil is 38 cents per barrel higher at $72.48. The Dow Jones Industrial Average is down 450 points at 44,176 with the NASDAQ is 94 points lower at 19,962.

Thursday Midday Dairy Market Summary - Butter Loses Strength

OUTSIDE MARKETS SUMMARY:

CORN:	1 Higher
SOYBEANS:	10 Higher
SOYBEAN MEAL:	$0.11 Lower
LIVE CATTLE:	$0.725 Lower
DOW JONES:	637 Points Lower
NASDAQ:	150 Points Lower
CRUDE OIL:	$0.07 Higher

MIDDAY MARKET UPDATE:

The block cheese price was up 0.25 cents settlings at $1.90 with three loads traded. The barrel cheese price slipped by 2.25 cent closing at $1.785 with three loads traded. The dry whey price remained unchanged, closing at $0.5450 with no loads traded. Class III futures are currently trading 1 to 12 cents higher, pulling back from Thursday morning's small rally. The butter price fell 1.75 cents, closing at $2.4225 with six loads traded. Grade A nonfat dry milk is 2 cents lower at $1.25 with one load traded. Class IV futures are anywhere from unchanged to 0.5 cents higher. Butter futures are 0.475 cents lower to 0.575 cents higher. Dry whey futures are 0.275 to 1.575 cents lower.