MILK:
Milk production has passed the spring flush period but is holding steady in many areas. Hot weather has not been widespread and has not had much impact on milk production or component values. Schools are now closed for the summer, with more milk moving to manufacturing. That is not expected to pressure prices as demand should utilize the supply. Crop conditions are improving as good rains have fallen in most areas. The weekly corn crop condition is 71% good/excellent. This was an increase of 2% from last week. The soybean crop is 68% good/excellent, up 1% from last week. If this continues, it will ensure plentiful feed supplies and low prices. That will improve the income over feed prices if milk prices maintain the current levels and increase as the year progresses.
AVERAGE CLASS III PRICES:
| 3 Month: | $18.99 |
| 6 Month: | $19.13 |
| 9 Month: | $18.95 |
| 12 Month: | $18.78 |
CHEESE:
Cheese prices may have found a level at which buyers and sellers might be comfortable doing business. Supplies are sufficient for demand. Cheese output has been steady, with an increase expected with more milk moving to the vat. The question is whether demand will absorb the extra production, allowing prices to improve as time progresses. The current inventory remains below a year ago but will not be the only reason cheese prices will see upside price potential. Demand needs to exceed supply to push prices higher.
BUTTER:
Butter is holding the gains from last week, but buyers have not been aggressive to begin the week. The price is expected to see further gains as domestic demand improves and international demand remains strong. The price generally increases during the summer, and this year should be no exception due to the inventory falling in April below a year earlier.
OUTSIDE MARKETS SUMMARY:
July corn closed down 9.00 cents per bushel at $4.3350, July soybeans closed down 1.25 cents at $10.5600 and July soybean meal closed down $.20 per ton at $295.50. July Chicago wheat closed down 12.75 cents at $5.4200. August live cattle closed up $0.38 at $219.25. July crude oil is up $0.71 per barrel at $65.29. The Dow Jones Industrial Average is down 1 point at 42,762, with the NASDAQ up 61 points at 19,591.
