MILK:
The February Milk Production report was bearish, but that did not keep buyers from moving spot cheese and butter prices higher. That was positive, but it did not create much excitement for traders. Milk production is increasing with the spring flush beginning. The increased cow numbers could set the stage for milk production running above a year ago over the next few months. This raises concern over how low milk prices could go through spring and early summer. However, increased milk production may not continue as low milk prices will curtail milk output over time. Class III futures were unchanged to higher except for March as it is mostly priced. Class IV futures did not have any trading activity today closing unchanged.
AVERAGE CLASS III PRICES:
| 3 Month: | $17.67 |
| 6 Month: | $17.87 |
| 9 Month: | $18.01 |
| 12 Month: | $17.97 |
CHEESE:
Cheese found support today, with barrels showing a gain of 8 cents. The volume of loads traded was positive and could indicate demand may have picked up and buyers needed to purchase loads. Traders viewed this with caution as once those loads are purchased, there may be no further reason for the market to remain supported. Prices need to increase by more than three days to trigger further buying interest.
BUTTER:
Retail butter demand has improved, but inventory has been increasing. Churning activity has been able to meet demand and then some. There are buyers who have been purchasing supplies for later in the year, but most have been comfortable purchasing on an as-needed basis. The USDA will release the February Cold Storage report tomorrow and is expected to show butter stocks above a year ago. However, it will be skewed somewhat due to fewer days this year than a year ago.
OUTSIDE MARKETS SUMMARY:
May corn closed up .25 cent per bushel at $4.6450, May soybeans closed down 2.50 cents at $10.0725 and May soybean meal closed down $2.70 per ton at $297.60. May Chicago wheat closed down 10.00 cents at $5.4825. June live cattle closed down $0.63 at $202.15. May crude oil is up .88 per barrel at $69.16. The Dow Jones Industrial Average is up 598 points at 42,583 with the NASDAQ is up 405 points at 18,189.
