Both Class III and Class IV contracts closed higher, with Class III futures showing the greatest gain. Cheese prices have increased over the past two days, which has provided enough to support the buying interest of traders. Trading volume with light as much of the price increase might have been due to short-covering and not the addition of long positions. The market will need to prove that support has been achieved, and prices will trend higher. It will take further price increases to generate increased buying interest from traders. Dairy Market News reports that milk production in the Eastern region is increasing, with some in the industry thinking spring flush may be ahead of usual for this time of year. Processors are working with milk intakes that are over a year ago. Demand has been somewhat slow to develop. The demand for Class I milk is steady and balanced with milk supplies. China listed 26 dairy products that will have 10% tariffs added when they go into effect on April 12. They did not add whey to the list as it is crucial for China's feed sector.
AVERAGE CLASS III PRICES:| 3 Month: | $18.17 |
| 6 Month: | $18.09 |
| 9 Month: | $18.22 |
| 12 Month: | $18.17 |
Cheese production has been slowly increasing due to increased milk receipts at the plant level. Spot milk prices have been running from $2.00 under class to $0.25 over class. This is not much different than it was a year ago. The block cheese price has increased 5 of the past 6 days and is getting traders' attention. However, there is concern the price increase may not hold due to sufficient cheese supplies.
BUTTER:The cream supply remains plentiful but there are some indications that the supply may have peaked. This does not mean that cream supplies will tighten anytime soon. Some plants report that they have a difficult time trying to keep up with supplies even though they are running plants at capacity. Butter inventory continues to increase. Retail demand is improving but not enough to cause buyers to become aggressive. Sufficient loads are being offered on the spot market, allowing buyers to purchase supply without chasing the market.
OUTSIDE MARKETS SUMMARY:May corn closed down 9.50 cents per bushel at $4.6075, May soybeans closed down 10.75 cents at $10.0050 and May soybean meal closed down $1.60 per ton at $300.20. May Chicago wheat closed down 2.75 cents at $5.5400. April live cattle closed up $1.85 at $201.40. April crude oil is up $1.45 per barrel at $67.70. The Dow Jones Industrial Average is down 82 points at 41,351 with the NASDAQ is up 212 points at 17,648.
