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.
