MILK:
It is uncertain whether buyers stepped back during the spot trading due to the implementation of tariffs and the possibility that dairy demand might be impacted. Mexico and Canada did not have additional tariffs added, as they are the largest importers of cheese, nonfat dry milk, and butterfat. The products that fall within the parameters of the USMCA agreement will continue to move with no tariffs. Products that fall outside of the USMCA agreement have a 10% tariff added. The tariffs added to countries may not reduce international demand for dairy products, but they may have an impact on demand indirectly as consumers will pay more for other food and durable goods, resulting in adjustments to diets and could reduce the demand for some dairy products. Both Class III and Class IV futures took a hit with Class III contracts showing substantial pressure.
AVERAGE CLASS III PRICES:
| 3 Month: | $16.88 |
| 6 Month: | $17.37 |
| 9 Month: | $17.60 |
| 12 Month: | $17.66 |
CHEESE:
There have been 39 loads of block cheese traded so far this week. Manufacturing plants are moving supplies to limit inventory growth. There is little expectation of price strength in the foreseeable future. Holding inventory will not be beneficial as supply is expected to remain readily available. Increasing milk production is increasing the output of cheese.
BUTTER:
There are indications that the cream supply is becoming less, but supplies remain readily available. Churns continue to run on full schedules to utilize the available cream. Buyers see no shortage of butter and continue to purchase as needed, with some buying and freezing it for later demand.
OUTSIDE MARKETS SUMMARY:
May corn closed down .25 cent per bushel at $4.5750, May soybeans closed down 18.00 cents at $10.1150 and May soybean meal closed up $.80 per ton at $288.00. May Chicago wheat closed down 3.25 cents at $5.3600. June live cattle closed down $2.70 at $204.70. May crude oil is down $4.76 per barrel at $66.95. The Dow Jones Industrial Average is down 1,679 points at 40,546 with the NASDAQ down 1,050 points at 16,551.
