MILK:
Traders were not convinced that the increase in cheese prices indicated a change in trend. The spot market will need to prove itself before traders will short-cover and buy new long positions. Underlying cash prices will need to move higher consistently for a few days before traders become aggressive buyers. Milk production is variable but holding strong for this time of year. Milk component values are slipping but remain higher than they have been historically. Strong milk output may limit the upside price potential for the foreseeable future. Lower milk prices are not expected to increase culling. Grain prices continue to decline, making it less expensive to feed cows and to hopefully improve their milk production. It is more profitable to hold a lower-producing cow and feed them less expensive feed than to purchase a high-priced heifer.
AVERAGE CLASS III PRICES:
| 3 Month: | $17.86 |
| 6 Month: | $18.18 |
| 9 Month: | $18.12 |
| 12 Month: | $18.08 |
CHEESE:
The May Cold Storage report showed American cheese stocks increasing by 5.6 million pounds, totaling 807.4 million pounds. Stocks are 1% below a year ago. Swiss cheese inventory increased by 229,000 pounds, totaling 22,746 million pounds and 5% above a year ago. Other cheese inventory increased 3.7 million pounds, totaling 582.3 million pounds and 2% below May 2024. Total cheese stocks increased by 9.0 million pounds, totaling 1.413 billion pounds. This was 2% below May 2024.
BUTTER:
Butter inventory increased 24.7 million pounds, totaling 361.6 million pounds. Inventory was 5% below May 2024. The fact that stocks have not been able to exceed year-earlier levels indicates strong demand and the potential for higher prices. However, buyers may not react substantially to the lower inventory compared to a year ago, but it may provide support as it did after the previous cold storage report.
Outside Markets Summary:
July corn closed down 6.00 cents per bushel at $4.1025, July soybeans closed down 21.50 cents at $10.2525 and July soybean meal closed down $4.50 per ton at $276.00. September Chicago wheat closed down 7.50 cents at $5.4450. August live cattle closed down $0.58 at $208.98. August crude oil is up $.55 per barrel at $64.92. The Dow Jones Industrial Average is down 107 points at 42,982, with the NASDAQ up 61 points at 19,974.
