MILK:
Class III milk futures continue to slide lower following the cheese prices. This will continue unless buyers aggressively step up to the plate. The bearishness of the milk production report continues to influence the market. Strong milk production indicates a sufficient supply for demand, eliminating the concern over supply. Hot weather during the summer may reduce milk output, but higher cow numbers and production per cow will maintain a sufficient supply even with a weather impact. Dairy cattle slaughter declined in May, according to the Livestock Slaughter report. There were 196,700 dairy cattle slaughtered. This was 10,500 fewer than April and 19,400 fewer than May 2024. This is the 21st consecutive month with year-over-year declines in slaughter.
AVERAGE CLASS III PRICES:
| 3 Month: | $17.82 |
| 6 Month: | $18.13 |
| 9 Month: | $18.12 |
| 12 Month: | $18.11 |
CHEESE:
Block cheese price fell to the lowest level since March 18. If the price declines by more than 2 cents, the price will move back to the level of April 2024. The barrel cheese price is back to the lowest level since March 21. Hopefully, prices will recover from these levels as the summer progresses and demand improves. Buyers should purchase for demand later in the year.
BUTTER:
The price has increased over the past two days, but the strength was limited. USDA will release the May Cold Storage report on Wednesday. The trade will watch to see whether the butter supply will continue to fall below a year ago. The previous cold storage report showed butter stocks were 7% below a year ago and sparked aggressive buying interest. Hopefully, we will see a repeat of that.
Outside Markets Summary:
July corn closed down 3 cents per bushel at $4.1625, July soybeans closed down 12 cents at $10.4675 and July soybean meal closed down $1.90 per ton at $280.50. September Chicago wheat closed down 17.50 cents at $5.5200. August live cattle closed up $0.18 at $209.55. August crude oil is down $3.50 per barrel at $65.01. The Dow Jones Industrial Average is up 507 points at 43,089, with the NASDAQ up 282 points at 19,913.
