Monday Closing Dairy Market Update - Dairy Traders Remain Bearish

OVERVIEW:

Class III milk futures did not improve ahead of the close. With little direction from the underlying cash, there is no reason for traders to turn bullish on the market. USDA will release the June Milk Production report on Tuesday.

MILK:

It may be very difficult for traders to turn bullish on this market. The current fundamentals do not suggest strength in milk prices anytime soon. We should see seasonal buying in the underlying cash markets, as buyers look ahead to second-half demand. However, there is little reason to be concerned over supplies at the current time. Milk production was above last year for the first five months of the year, and the June Milk Production report is expected to show continued gains over last year. I estimate June milk production to be 1.5% above June 2024. Cow numbers are expected to have increased, with my estimate at 3,000 head more than May. Milk replacement prices remain high, and farmers hang onto cows. The corn crop continues to do well with 74% of the crop in good/excellent condition compared to 67% last year. Soybeans are 68% good/excellent and the same as a year ago.

AVERAGE CLASS III PRICES:

3 Month:	$17.71
6 Month:	$18.08
9 Month:	$18.03
12 Month:	$18.03

CHEESE:

There was buying interest for block cheese during spot trading, but the interest was at lower prices. The recent activity in the spot market gives the impression that buyers and sellers are comfortable at the current price level. Demand remains steady and has not been improving as it should be at this time of year. Cheese supplies remain plentiful.

BUTTER:

The butter price has been in a downtrend and has been unable to find support. The price was anticipated to increase through the summer as buyers purchased for the upcoming fall demand. However, that has not developed with buyers having already purchased a supply of butter ahead of time. There have been some weeks during which over 100 loads of butter had changed hands in the spot market.

OUTSIDE MARKETS SUMMARY:

December corn closed down 5.50 cents per bushel at $4.2225, November soybeans closed down 9.75 cents at $10.2600 and December soybean meal closed down $4.00 per ton at $284.80. September Chicago wheat closed down 4.00 cents at $5.4225. August live cattle closed up $1.68 at $225.23. September crude oil is down .31 per barrel at $65.74. The Dow Jones Industrial Average is down 19.12 points at 44,323.07 and NASDAQ is up 78.51 points at 20,974.17.

Monday Midday Dairy Market Summary - Butter Continues to Slide

OUTSIDE MARKETS SUMMARY:

CORN:	7 Lower
SOYBEANS:	12 Lower
SOYBEAN MEAL:	$3.80 Lower
LIVE CATTLE:	$1.90 Higher
DOW JONES:	248 Points Higher
NASDAQ:	153 Points Higher
CRUDE OIL:	$0.15 Lower

MIDDAY MARKET UPDATE:

Both block and barrel cheese prices remained unchanged Monday at $1.6425 and $1.66, respectively. There were no loads traded with four unfiled bids for loads of blocks and one uncovered offer for a load of barrels. Traders did not like the fact that cheese prices remained steady, reversing the overnight and early gains in Class III futures. Futures are 17 cents lower to 7 cents higher with only the December contract showing an increase. The dry whey price gained 0.50 cent, closing at 56.25 cents with no loads traded. The butter price declined 1.25 cents, closing at $2.50 as the lower trend continues. There were four loads traded. Buyers are holding back on purchases due to price weakness, showing no need to be aggressive. Grade A nonfat dry milk increased a penny, closing at $1.30 with eight loads traded. Class IV futures have not yet been traded. Butter futures are 0.50 to 1.37 cents lower. Dry whey futures are 0.20 to 1.15 cents higher.

Monday Morning Dairy Market Update - Traders Turn Friendly on Market

OPENING CALLS:

Class III Milk Futures:	10 to 20 Higher
Class IV Milk Futures:	Mixed
Butter Futures:	Mixed

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	2 to 3 Lower
Soybean Futures:	7 to 9 Lower
Soybean Meal Futures:	$0.50 to $1 Lower
Wheat Futures:	1 to 2 Higher

MILK:

Traders turned friendly on the market to begin the week. Class III milk futures post double-digit gains in active trading. The minor strength of cheese price during the second half of last week gave the impression prices may have found a bottom. Traders are buying futures in the attempt to catch a rebound in prices. It is unlikely they will establish long-term positions as the market is expected to remain choppy. Milk production has slowed due to the impact of hot weather, but is expected to remain higher than a year ago. USDA will release the June Milk Production report on Tuesday, which will provide the level of milk production, the number of cows, and production per cow for the month.

CHEESE:

The increase in spot cheese prices in the second half of last week may indicate prices are low enough for buyers to become more aggressive. This may provide further support to the market this week. Seasonal buying should be evident, but only if demand improves seasonally.

BUTTER:

The butter price has been struggling, falling to the lowest level in a month. This has been a surprise because of steady retail demand and strong export demand. A tightening cream supply is reducing churning activity, but production remains sufficient for demand. Sellers may be less aggressive as the summer progresses and further declines in production impact supplies. 

Friday Closing Dairy Market Update - Ice Cream Manufacturers to Phase Out Food Dyes

OVERVIEW:

Milk futures closed the week with little fanfare. Cheese prices showed minor gains, leaving traders guessing market direction next week. Nonfat dry milk was the only category posting a weekly gain in the spot markets. Ice cream manufacturers will phase out artificial food dyes over the next three years.

MILK:

Class III futures were steady to lower for the week, but contracts fell initially and then regained much of the losses. This leaves the market without solid direction. Traders may receive some direction next week with the release of the June Milk Production and Cold Storage reports. Milk remains sufficient for bottling and manufacturing, which suppresses any concerns that may have developed over the potential of a tightening supply. Ice cream manufacturers have pledged to phase out artificial food dyes by 2028. This move has been the result of the health secretary, Robert Kennedy Jr., looking to implement policies to phase out synthetic dyes from the nation's food supply. Forty ice cream manufacturers representing 90 percent of the product sold in the U.S. are being proactive with this initiative. The FDA indicates food dyes are safe, but ice cream manufacturers are taking steps to phase out these dyes to avoid disruption to sales.

AVERAGE CLASS III PRICES:

3 Month:	$17.82
6 Month:	$18.17
9 Month:	$18.10
12 Month:	$18.08

CHEESE:

For the week, blocks decreased by 1.75 cents with 36 loads traded. The weekly average price is $1.6355. Barrels decreased by 1.50 cents with one load traded. The weekly average price is $1.6660. Dry whey decreased by a penny with five loads traded. The weekly average price is 56.85 cents.

BUTTER:

For the week, butter decreased by 7.75 cents with seven loads traded. The weekly average price is $2.5385. Dry whey decreased by a penny with five loads traded. The butter price moved to the lowest level since June 20, eliminating the uptrend that has been developing.

OUTSIDE MARKETS SUMMARY:

December corn closed up 6.75 cents per bushel at $4.2775, November soybeans closed up 9.25 cents at $10.3575 and December soybean meal closed up $5.30 per ton at $288.80. September Chicago wheat closed up 12.75 cents at $5.4625. August live cattle closed down $0.13 at $223.55. August crude oil is down $0.20 per barrel at $67.34. The Dow Jones Industrial Average is down 142 points at 44,342, with the NASDAQ up 10 points at 20,896.

Friday Midday Dairy Market Summary - Butter Shows Further Weakness

OUTSIDE MARKETS SUMMARY:

CORN:	6 Higher
SOYBEANS:	7 Higher
SOYBEAN MEAL:	$3.60 Higher
LIVE CATTLE:	$0.70 Lower
DOW JONES:	220 Points Lower
NASDAQ:	2 Points Lower
CRUDE OIL:	Unchanged

MIDDAY MARKET UPDATE:

The block cheese price increased 0.25 cent, closing at $1.6425 with 14 loads traded. The barrel cheese price gained a penny, closing at $1.66 with one load traded. The large amount of blocks changing hands is keeping pressure on nearby Class III futures. The dry whey price decreased 1.50 cents, closing at 55.75 cents with five loads traded. The decline of dry whey more than offset the increase in cheese prices. Class III futures are 14 cents lower to 14 cents higher. The butter price decreased by 1.75 cents, closing at $2.5125 with no loads traded. Grade A nonfat dry milk remained unchanged at $1.29 with no loads traded. Class IV futures have not yet been traded. Butter futures are 1.00 to 4.00 cents lower. Dry whey futures are 0.20 cent lower to 0.47 cent higher.

Friday Morning Dairy Market Update - Traders Are Optimistic Over Higher Cash

OPENING CALLS:

Class III Milk Futures:	5 to 10 Higher
Class IV Milk Futures:	Mixed
Butter Futures:	Mixed

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	5 to 7 Higher
Soybean Futures:	10 to 13 Higher
Soybean Meal Futures:	$3 to $4 Higher
Wheat Futures:	7 to 9 Higher

MILK:

Traders showed further support for Class III futures overnight. The anticipation is that underlying cheese prices may have found a bottom. This could increase the interest of buyers as they want to take advantage of the lower prices. Buying interest usually increases at this time of year as they look to the upcoming demand. Even though the supply of milk is sufficient for demand, the decrease in milk output due to summer weather does have a psychological impact on traders. USDA will release the June Milk Production report on Tuesday.

CHEESE:

Cheese buyers have not yet turned aggressive, but prices held steady on Wednesday and blocks increased on Thursday, which may have indicated the market has found a bottom. However, it is unlikely that buyers of cheese will become very aggressive as they have no concern over cheese supplies.

BUTTER:

The butter price may be content to remain sideways for the time being, as buyers are purchasing what is being offered on the spot market without having to chase the price higher. Retail butter demand is steady, while food service demand is less than expected for this time of year.

Thursday Closing Dairy Market Update - Markets Higher

OVERVIEW:

Every sector of dairy futures higher Thursday afternoon as the stock market reaches record highs on consumer strength. In the cash market, block cheese and non-fat dry milk led the way while other dairy products had little activity.

MILK:

Class III milk showed modest gains, from 4 to 30 cents higher this afternoon. With the heat hitting most of the country, milk production is slightly lower, with more heat to come next week.

AVERAGE CLASS III PRICES:

3 Month:	$17.68
6 Month:	$18.09
9 Month:	$18.04
12 Month:	$18.03

CHEESE:

Cheese futures are 0.6 to 2.2 cents higher, while the block cheese price increased 1.5 cents earlier this afternoon. Record cheese exports in May are helping strengthen the cheese prices, although the last couple of days have had the most interest in blocks over barrels.

BUTTER:

Butter futures saw some mid-afternoon strength, up 0.0025 to 0.25 cents higher on the day. The cash market had no trades but a few unfulfilled bids and one offer at the close. Butter prices have eased somewhat due to lower demand in both the U.S. markets and the world market, most notably in the E.U.

OUTSIDE MARKETS SUMMARY:

December corn closed 3 cents per bushel lower at $4.2100, November soybeans closed up 6 cents at $10.2650 and December soybean meal closed up 2 cents per ton at $283.70. September Chicago wheat closed down 7.25 cents at $5.34. August live cattle closed down $0.225 at $223.675. August crude oil is up $1.24 per barrel at $67.62. The Dow Jones Industrial Average is up 229 points at 44,484, with the NASDAQ up 155 points at 20,885.

Thursday Midday Dairy Market Summary = Block Cheese Higher

OUTSIDE MARKETS SUMMARY:

CORN:	3 Lower
SOYBEANS:	5 Higher
SOYBEAN MEAL:	$0.21 Lower
LIVE CATTLE:	$1.00 Lower
DOW JONES:	116 Points Higher
NASDAQ:	161 Points Higher
CRUDE OIL:	$0.95 Higher

MIDDAY MARKET UPDATE:

The block cheese price 1.5 cents higher at $1.64 with 11 loads traded and seven unfulfilled bids at the spot settlement. The barrel cheese price remained steady at $1.65 with no loads traded. No buyers or sellers showed up for barrels. The dry whey price remained unchanged at 57.25 with no loads traded and only one offer. Class III futures are 6 to 17 cents higher. The butter price remained steady, closing at $2.53 with no loads traded. There were three remaining bids and one offer left at the close. Grade A nonfat increased 1 cent, closing at $1.29 with 12 loads traded. Four offers and five bids were left standing. Class IV futures are mixed from up 5 cents to 12 cents lower. Butter futures are 0.05 to 0.15 cents higher. Dry whey futures have only traded on the August contract at 0.35 cents higher, so far.

Fluid Milk and Cream - Western U.S. Report 29

In California, summer heat is contributing to declining milk production week-to-week, but contacts say output is up from this time last year. Some production facilities in the state are down for maintenance, causing some plant managers to offer spot volumes of milk to nearby manufacturers at discounted prices. Class I demand is seasonally light, but demand is steady for all other Classes. 

In Arizona, high summer temperatures are contributing to lighter milk output. Some plant managers in the state are looking for spot milk from nearby states to continue running steady production schedules. Demand is steady for all Classes of milk. 

In New Mexico, milk output continues to decline, seasonally. Plant managers say milk volumes are sufficient to meet their current production needs. Steady demand is present for all Classes of milk. 

Contacts in the Pacific Northwest report milk output is falling below expectations for this time of year. Some manufacturers are searching for additional milk volumes to continue running steady production schedules. Demand for Class I milk is seasonally light, but demand is steady for all other Classes. 

Milk output is also declining in the mountain states of Idaho, Utah, and Colorado. Manufacturers are searching for all Classes of milk, but some say spot volumes are becoming more difficult to obtain. 

Cream production is declining in the West. Demand for cream is strong, and contacts say multiples are increasing. Contacts report condensed skim milk is available to meet current processing needs in the region.

Thursday Morning Dairy Market Update - Milk Futures May Show Further Strength

OPENING CALLS:

Class III Milk Futures:	4 to 6 Higher
Class IV Milk Futures:	Mixed
Butter Futures:	Mixed

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	2 to 3 Lower
Soybean Futures:	1 to 2 Lower
Soybean Meal Futures:	$1 to $2 Lower
Wheat Futures:	3 to 5 Lower

MILK:

It was welcome to see the strength in Class III futures on Wednesday after a period of continued weakness. Steady cheese prices triggered short covering as traders bought back futures just in case the market had found a bottom. The downside of prices may be limited at current levels due to reduced milk production and the probability of a seasonal increase in demand. However, even if demand improves, the upside potential for prices may be limited. Milk production remains higher than a year ago despite the impact of hot weather. But any improvement in milk prices will certainly be welcomed.

CHEESE:

The general feeling is that cheese prices should be at a bottom with the lower prices being attractive to buyers as they look ahead to demand later in the year. Even though the inventory of cheese has been below the previous year, there remains a sufficient supply to satisfy the current demand. Unless the supply tightens, the upside price potential may be limited.

BUTTER:

The recent weakness in butter has been greater than expected. The price may move into a sideways trading range. One thing for certain is that the current butter price continues to bring international buyers to our shores, as the U.S. price is $1.00 lower than the world price. Churning has slowed due to reduced cream supplies, but it has not caused concern for buyers. 

Wednesday Closing Dairy Market Update - Class III Milk Futures Finally Showed Strength

OVERVIEW:

Class III futures finally showed strength, but the potential for the market to continue higher may not be very great unless there is a significant change in fundamentals. Traders short-covered due to cheese prices holding.

MILK:

Milk production has been seeing rising temperatures, which have impacted cow comfort. However, even with reduced volumes coming from farms, milk production remains above a year ago. Class 1 bottling is steady in line with recent weeks. Ice cream production is increasing as temperatures increase. Class III futures finally bounced as short-covering took place due to cheese prices remaining steady. This does not indicate the market is ready to trend higher, but traders wanted to liquidate their previously sold positions just in case. Nearby contracts showed further strength in late trading after the prices were settled for the day. The CME settles futures contracts shortly after 2:00 p.m. CDT, even though trading continues until 4:00 p.m. CDT. That is the reason futures prices near the close may not always be the settlement prices. This is a standard for the futures market for all contracts that trade until 4:00 pm CDT. The thing to remember is that the strength or weakness of prices into the close generally indicates how the market will open and trade during the night.

AVERAGE CLASS III PRICES:

3 Month:	$17.78
6 Month:	$18.18
9 Month:	$18.11
12 Month:	$18.09

CHEESE:

More spot milk was available in the Central region due to some plants scheduling downtime for maintenance. Spot milk last week ranged from $3.00 below class to flat class. This is not expected to be maintained as spot milk is again expected to move above class as the summer progresses.

BUTTER:

Cream demand from other Class II products is increasing, reducing the amount available for butter production and slowing production schedules. Butter output remains sufficient for demand. Buyers have been able to purchase some supplies ahead as manufacturers have been aggressively selling butter over the past months.

OUTSIDE MARKETS SUMMARY:

December corn closed up 4.25 cents per bushel at $4.2400, November soybeans closed up 18.75 cents at $10.2050 and December soybean meal closed up $4.00 per ton at $283.50. September Chicago wheat closed up 3.25 cents at $5.4125. August live cattle closed up $1.50 at $223.90. August crude oil is up $0.12 per barrel at $66.64. The Dow Jones Industrial Average is up 231 points at 44,255, with the NASDAQ up 53 points at 20,730.

Wednesday Midday Dairy Market Summary - Cheese Prices Hold Steady

OUTSIDE MARKETS SUMMARY:

CORN:	4 Higher
SOYBEANS:	17 Higher
SOYBEAN MEAL:	$4.30 Higher
LIVE CATTLE:	$1.45 Higher
DOW JONES:	107 Points Higher
NASDAQ:	15 Points Higher
CRUDE OIL:	$0.12 Lower

MIDDAY MARKET UPDATE:

The block cheese price remained steady at $1.6250 with six loads traded. The barrel cheese price remained steady at $1.65 with no loads traded. There were five unfilled bids and one uncovered offer for blocks remaining at the close of spot trading. No buyers or sellers showed up for barrels. The dry whey price remained unchanged at 57.25 with no loads traded. Class III futures are 4 cents lower to 21 cents higher. The butter price declined a penny, closing at $2.53 with five loads traded. Grade A nonfat increased 0.50 cent, closing at $1.28 with 12 loads traded. Class IV futures have only shown trading in the December contract, with the price down 2 cents. Butter futures are 1.00 cents lower to 1.02 cents higher. Dry whey futures are 0.95 cent lower to 0.20 cent higher.

Wednesday Morning Dairy Market Update - Overnight Activity Points to Lower Prices

OPENING CALLS:

Class III Milk Futures:	4 to 8 Lower
Class IV Milk Futures:	2 to 5 Lower
Butter Futures:	Mixed

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	4 to 5 Higher
Soybean Futures:	6 to 8 Higher
Soybean Meal Futures:	$1 to $2 Higher
Wheat Futures:	Steady to 1 Higher

MILK:

Milk futures have been unable to find support with underlying cash prices continuing to erode. Milk receipts have decreased with many plants turning to the spot market for extra milk to maintain a full operating schedule. Of course, the desire to maintain strong product output keeps the market sufficiently supplied. This may slow as plants are having to purchase spot milk above class and then continue to sell the finished product at lower prices. It is doubtful that cow numbers will decline with lower milk prices as expansions are still taking place and cow numbers are being maintained. Farmers have not needed to cull cows to provide extra income.

CHEESE:

Cheese prices are nearing the lows last seen in June as buyers continue to hold back and purchase at lower prices. Sellers continue to offer cheese to the spot market aggressively and are willing to sell at lower prices. Until supply begins to tighten due to reduced production and/or an increase in demand, prices may remain under pressure.

BUTTER:

The butter price has declined more than anticipated. Surprisingly, the domestic price has not reflected the international price. The tight supplies in other countries have increased export demand substantially, but it has yet to provide strong support. Buying interest should increase at lower prices. 

Tuesday Closing Dairy Market Update - Global Dairy Trade Gains 1.1%

OVERVIEW:

It was another day of weakness for milk futures. Spot butter and cheese prices came under further pressure. The Global Dairy Trade auction increased 1.1% from the previous event.

MILK:

There seems to be no bottom to Class III futures with new lows again today. Spot prices remain under pressure, leaving milk futures in a downtrend. The August Class III contracts moved below July, leaving the market in a bearish grip. Class IV futures showed little trading activity as traders remain uncertain whether the butter price will decline much further. The Global Dairy Trade auction trade-weighted average increased 1.1% compared to the previous event. There were 24,290 metric tons sold at an average price of $4,380 per metric ton. Anhydrous milk fat increased 0.8% to $6,973 per metric ton or $3.16 per pound. Butter remained steady with the previous event at $7,492 per metric ton or $3.40 per pound. Cheddar cheese declined 5.6% to $4,589 per metric ton or $2.08 per pound. Lactose declined 1.5% to $1,355 per metric ton or $0.61 per pound. Skim milk powder increased by 2.5% to $2,785 per metric ton or $1.26 per pound. Whole milk powder gained 1.7% to $3,928 per metric ton or $1.78 per pound. Mozzarella declined 0.7% to $4,760 per metric ton or $2.16 per pound.

AVERAGE CLASS III PRICES:

3 Month:	$17.54
6 Month:	$17.99
9 Month:	$17.94
12 Month:	$17.96

CHEESE:

The block cheese price is now within 3 cents of the previous low established on June 24. Buyers usually turn somewhat aggressive at this time of year as they look forward to the increase in demand later in the year. However, that pattern may be different this year as buyers continue to purchase cheese without having to chase the market higher.

BUTTER:

The butter price has declined to the lowest level it has been since June 26. Domestic demand is steady, with sufficient supply readily available. International demand remains strong. The global price of butter has increased dramatically and is close to historic levels. This is directly impacting the baking, pastry, and processed food industries in multiple countries, where this key ingredient is becoming increasingly expensive and scarce. There appear to be no signs of relief anytime soon. Global prices are expected to remain high due to the persistence of supply restrictions and continued demand from many countries.

OUTSIDE MARKETS SUMMARY:

December corn closed up 1.75 cents per bushel at $4.1975, November soybeans closed down 5.25 cents at $10.0175 and December soybean meal closed down $2.20 per ton at $279.50. September Chicago wheat closed down 3.50 cents at $5.3800. August live cattle closed up $3.05 at $222.40. August crude oil is down $0.16 per barrel at $66.82. The Dow Jones Industrial Average is down 436 points at 44,023, with the NASDAQ up 37 points at 20,678.

Tuesday Midday Dairy Market Update - Butter and Cheese Show Further Weakness

OUTSIDE MARKETS SUMMARY:

CORN:	1 Higher
SOYBEANS:	8 Lower
SOYBEAN MEAL:	$2.80 Lower
LIVE CATTLE:	$2.87 Higher
DOW JONES:	336 Points Lower
NASDAQ:	131 Points Higher
CRUDE OIL:	$0.58 Lower

MIDDAY MARKET UPDATE:

The block cheese price declined 2 cents, closing at $1.6250 with four loads traded. The barrel cheese price declined 2 cents, closing at $1.65 with no loads traded. Buyers continue to hold back as the sellers want to move cheese. The sellers continue to offer cheese even though they have to reduce their offers to move it. They have no desire to hold cheese for the potential of higher prices. The dry whey price increased 0.50 cent, closing at 57.25 with no loads traded. Class III futures are 1 to 20 cents lower. The butter price declined 4 cents, closing at $2.54 with no loads traded. There was one unfilled bid and three uncovered offers remaining at the close. Grade A nonfat dry milk increased 0.75 cent with four loads traded. Class IV futures have only traded in the January contract at one cent higher. Butter futures are 1.97 to 6.40 cents lower. Dry whey futures are 0.53 cent lower to 0.27 cent higher.

Tuesday Morning Dairy Market Update - Spot Prices May Show Further Weakness

OPENING CALLS:

Class III Milk Futures:	Mixed
Class IV Milk Futures:	Mixed
Butter Futures:	Mixed

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	2 to 3 Lower
Soybean Futures:	1 to 3 Lower
Soybean Meal Futures:	Mixed
Wheat Futures:	2 to 4 Lower

MILK:

Class III futures suffered losses on Monday in response to further weakness in cheese and butter. This moved the August Class III contract in line with the July contract. It was hoped that July would be the low for the rest of the year, but that does not appear to be the case presently. The July contract is mainly priced and will show limited movement the rest of the month until expiration. The August contract will begin to be priced this week and will remain open to underlying cash movement over the next month. Strength in cash prices could provide support to move the August back above July. Traders are likely to take a wait-and-see attitude before attempting to take a profit from a short-term trade.

CHEESE:

Cheese prices may be headed back to the lows set on June 24. Cheese buyers should step up to take advantage of the lower prices and begin seasonal buying. However, sellers continue to offer supplies to the spot market, leaving buyers complacent and unconcerned over supply.

BUTTER:

The butter price remains in an uptrend with demand steady and showing signs of improvement. However, current supplies are sufficient for demand with buying interest supporting the market, but not creating any excitement or concern over supply.

Monday Closing Dairy Market Update - Market Sees Negative Start to the Week

OVERVIEW:

It was not a good day for Class III futures, with August Class III futures falling to a new contract low and matching the July price. This is very concerning as buyers in the spot market continue to hold back and are still able to purchase supplies without difficulty.

MILK:

There is no shortage of milk, even though milk receipts at the plant level are decreasing. This is seasonal, as summer weather affects cow comfort and reduces milk components. However, the impact is not as much as it once was due to significant improvements in cooling systems to minimize the effect of hot weather. Hotter temperatures are more frequent during July and August, which could tighten the milk supply further, but even with lower milk production, milk prices may not see much upside unless demand improves. Milk output continues to remain above a year ago as cow numbers increase and milk production per cow remains strong. Spot milk supply has tightened with prices as much as $2.00 over class. Some plants are actively looking for spot milk to maintain full production schedules.

AVERAGE CLASS III PRICES:

3 Month:	$17.61
6 Month:	$18.05
9 Month:	$18.00
12 Month:	$18.01

CHEESE:

Cheese prices have eliminated the recent gains and are now nearing the bottom of the trading range they have been in since October. The range for blocks has been from $1.5750 to $1.9550. The range for barrels was from $1.55 to $1.90. It may be difficult for cheese prices to move to the upper end of the range, much less break above it.

BUTTER:

The butter price has been holding much better than cheese, with the price near the highs of the year, and is poised to move higher as the summer progresses. Bulk butter is in strong demand. Exports of butterfat so far this year are phenomenal, up 174.7% from a year ago. Domestic demand is reported as steady.

OUTSIDE MARKETS SUMMARY:

December corn closed up 5.75 cents per bushel at $4.1800, November soybeans closed down 0.25 cent at $10.0700 and December soybean meal closed down $1.90 per ton at $281.70. September Chicago wheat closed down 3.50 cents at $5.4150. August live cattle closed down $2.85 at $219.35. August crude oil is down $1.47 per barrel at $66.98. The Dow Jones Industrial Average is up 88 points at 44,460, with the NASDAQ up 55 points at 20,640.

Monday Midday Dairy Market Summary - Cheese and Butter Prices Weaken

OUTSIDE MARKETS SUMMARY:

CORN:	2 Higher
SOYBEANS:	4 Lower
SOYBEAN MEAL:	$2.30 Lower
LIVE CATTLE:	$3.00 Lower
DOW JONES:	57 Points Higher
NASDAQ:	73 Points Higher
CRUDE OIL:	$1.30 Lower

MIDDAY MARKET UPDATE:

The block cheese price declined 1.50 cents, closing at $1.6450 with one load traded. The barrel cheese price declined 0.50 cent, closing at $1.67 with no loads traded. An offer for a load of blocks and two offers for barrels remained at the close. The dry whey price remained unchanged at 56.75 cents with no loads traded. Class III futures are 3 to 26 cents lower, with August showing the greatest loss. The butter price declined a penny, closing at $2.58 with two loads traded and an unfilled bid for one load remaining at the close of spot trading. Grade A nonfat dry milk remained unchanged at $1.2675 with no loads traded. Class IV futures have not yet been traded. Butter futures are 0.50 cent lower to 0.27 cent higher. Dry whey futures are 1.02 to 1.70 cents lower.

Dairy revenue sees impacts from crossbreeding

U.S. milk production increased for the fifth consecutive month in May, rising 1.6% year over year. In the West, producers saw mixed results. Idaho saw strong milk production growth as improved margins and increased processing capacity supported herd expansion. In contrast, lower milk revenues in Washington contributed to a shrinking dairy herd. However, the recent opening of a major butter and powder plant for the state’s largest dairy cooperative should offer some relief, as milk check retains are likely to lessen as the facility gets online. Meanwhile, California and Arizona experienced above-average temperatures in May and June, resulting in reduced milk output, which is typical for the region. (Summer heat puts stress on cows, negatively impacting milk production.)

The dairy industry is experiencing a notable shift in revenue, with dairy cattle marketed into the beef sector forecast to account for nearly 20% of total dairy income in 2025. Dairies are significantly benefiting from tight beef cattle supplies and corresponding record-high prices for calves and cull cows. Advances in genetics and increased crossbreeding have positioned dairies to increase the value of day-old calves and cull cows within the beef supply chain. Given this trend, the dairy industry is expected to play an increasingly impactful role in beef markets.

Effective July 1, updates to dairy and livestock insurance products will provide new benefits for dairy producers. The Dairy Revenue Protection (DRP) program has adjusted butterfat and protein levels to align with the trend toward higher milk components. Additionally, DRP now classifies diseases that prevent dairies from marketing milk as a natural disaster, allowing for coverage. Enhancements to Livestock Risk Protection (LRP) products will now allow dairy producers to protect the futures price on their dairy-cull cows. Additionally, producers will be able to protect the price on their day-old dairy-cross calves. 

Profitability

Dairy: Slightly profitable - Neutral 12-month outlook

Dairy margins have improved over the past year due to expanded processing capacity, stronger milk prices and lower feed costs, but reforms to milk pricing formulas are likely to hurt prices received by western dairies.

Monday Morning Dairy Market Update - Traders Retain a Bearish Attitude

OPENING CALLS:

Class III Milk Futures:	4 to 8 Lower
Class IV Milk Futures:	Mixed
Butter Futures:	Mixed

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	2 to 3 Higher
Soybean Futures:	4 to 5 Higher
Soybean Meal Futures:	Mixed
Wheat Futures:	4 to 6 Higher

MILK:

Milk futures continue to lack support as the underlying cash provides no bullish influence on the market. Milk production has declined due to the impact of summer weather, but it remains above that of a year ago. Milk prices will have a difficult time increasing unless overall demand for dairy products improves. Much of the news is that dairy demand is good, but not increasing as it generally does at this time. Hopefully, the increase in demand has just been slower to develop and will increase as the summer progresses. The market will need to prove itself before traders might get excited about buying futures aggressively.

CHEESE:

Cheese prices are near the bottom of the wide trading range they have been in since October. Hopefully, demand will improve and prices will move back to the levels seen in May. Strength may be limited due to buyers being able to purchase a significant amount of cheese at lower prices.

BUTTER:

The butter price is expected to resume the uptrend, but the price is expected to remain choppy. There is no supply shortage that would tighten the market and increase prices rapidly. The supply of cream has decreased but remains sufficient to keep churning active.

Friday Closing Dairy Market Update - USDA Raises Estimated Milk Production

OVERVIEW:

Class III milk futures held up well despite the further decline of cheese prices. Class IV futures showed little trading activity. All categories in the spot market declined this week. The World Agricultural Supply and Demand report showed higher milk production and higher milk prices for this year and 2026.

MILK:

Class III milk futures held up well with contracts closing mixed despite further weakness of cheese prices. Futures closed lower for the week. The USDA released the World Agricultural Supply and Demand report today. They increased their estimates for milk production for this year by 500 million pounds to an expected output of 228.3 billion pounds. If this comes to fruition, it would be an increase of 2.4 billion pounds from 2024. The estimate for milk production in 2026 was raised by 900 million pounds to reach 229.1 billion pounds. The continued increase in cow numbers and milk production per cow is expected to fuel the gain. The Class III price estimate for this year was reduced $0.15 to an average of $18.50 per cwt. The price for 2026 was raised by $0.05 to average $17.85. The Class IV average price rose $0.20 this year to $19.05 per cwt. The price for 2026 was raised $0.40 to average $18.60. The estimate for the All-milk price this year increased $0.05 to $22.00 per cwt. The average estimated price for 2026 was raised $0.35 to $21.65.

AVERAGE CLASS III PRICES:

3 Month:	$17.86
6 Month:	$18.26
9 Month:	$18.16
12 Month:	$18.13

CHEESE:

For the week, blocks declined 2.50 cents with 42 loads traded. The weekly average price was $1.6835. Barrels declined 4.50 cents with nine loads traded. The weekly average price was $1.71. Dry whey declined 4 cents with 10 loads traded. The weekly average price was 58.65 cents. USDA estimates the average cheese price this year to be $1.84 per pound, down $0.02 from its June estimate. The price for 2026 was left unchanged at $1.81 per pound. The Dry whey price was raised a penny this year to 57.50 cents and raised a half cent to average 51.50 cents per pound for 2026.

BUTTER:

For the week, butter declined 1.50 cents with 17 loads traded. The weekly average price was $2.5960. Grade A nonfat dry milk declined 0.75 cent with 9 loads traded. The weekly average price was $1.2660. The average butter price this year increased 2.50 cents on today's report to an average of $2.56 per pound. The average price for 2026 rose by 5.50 cents to $2.5350 per pound. The nonfat dry milk price was raised a penny to $1.26 per pound. The projected price average for 2026 is $1.2350, up 2 cents from June.

OUTSIDE MARKETS SUMMARY:

December corn closed down 4.25 cents per bushel at $4.1225, November soybeans closed down 6.50 cents at $10.0725 and December soybean meal closed down $1.70 per ton at $283.60. September Chicago wheat closed down 9.50 cents at $5.4500. August live cattle closed up $2.98 at $222.20. August crude oil is up $2.11 per barrel at $68.68. The Dow Jones Industrial Average is down 279 points at 44,372, with the NASDAQ down 45 points at 20,586.

Friday Midday Dairy Market Summary - Cheese Shows Further Weakness

OUTSIDE MARKETS SUMMARY:

CORN:	5 Lower
SOYBEANS:	3 Higher
SOYBEAN MEAL:	$0.50 Lower
LIVE CATTLE:	$2.75 Higher
DOW JONES:	266 Points Lower
NASDAQ:	3 Points Higher
CRUDE OIL:	$1.89 Higher

MIDDAY MARKET UPDATE:

The block cheese price decreased 2.50 cents, closing at $1.66 with six loads traded. The barrel cheese price declined 3.50 cents, closing at $1.6750 with one load traded. There were two unfilled bids for blocks and two uncovered offers for barrels remaining at the close of spot trading. The dry whey price increased 0.50 cent, closing at 56.75 with two loads traded. Class III futures are 1 to 9 cents lower. The butter price remained steady at $2.59 with four loads traded. Grade A nonfat dry milk increased 0.25 cent, closing at $1.2675 with no loads traded. Class IV futures have only traded in the September contract at 14 cents lower. Butter futures are 1.75 cents lower to 1.15 cents higher. Dry whey futures are 0.02 to 0.45 cent lower. USDA raised its estimates for milk production this year by 500 million pounds to 228.3 billion pounds. The estimate was raised for 2026 by 900 million pounds to 229.1 billion pounds.

Friday Morning Dairy Market Update - Price Uncertainty Remains

OPENING CALLS:

Class III Milk Futures:	3 to 6 Higher
Class IV Milk Futures:	4 to 8 Higher
Butter Futures:	Steady to 1 Higher

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	1 to 2 Lower
Soybean Futures:	1 to 3 Lower
Soybean Meal Futures:	Mixed
Wheat Futures:	1 to 3 Lower

MILK:

Traders are looking to scalp the market to hopefully take some profits rather than establish long-term positions. There is little reason for prices to establish a higher trend. The milk supply has decreased slightly, increasing spot milk prices. However, milk production remains higher than a year ago. There is little fundamental news for traders to get excited about. Overnight trading activity was rather active with most contracts higher. This is a bit unusual due to price uncertainty. USDA will release the World Agricultural Supply and Demand (WASDE) report this morning. The report will provide their estimates of milk production, milk prices and dairy product prices for this year and 2026.

CHEESE:

Cheese is expected to remain choppy in the lower area of the price range. Demand is steady with supply sufficient. Buyers have little concern over the supply as sellers continue to offer cheese to the spot market.

BUTTER:

Butter may find some further buying interest today and likely regain the loss of earlier in the week. The cream supply is tightening but remains sufficient for churning and the production of ice cream and other Class II products.

Thursday Closing Dairy Market Update - Spot Milk Supply Is Tightening

OVERVIEW:

Class III milk futures have nowhere to go. Sellers continue to bring supply to the spot market, limiting the upward price potential. The USDA will release the World Agricultural Supply and Demand Estimates report on Friday.

MILK:

It is interesting to see how the market can change quickly as far as the supply of milk is concerned. Some manufacturing plants in the Central region report they are short of milk and are having difficulty finding spot milk to maintain full production schedules. Just a few weeks ago, spot milk prices were as much as $8.00 below class with plants running on full schedules. That changed as the hot weather impacted cow comfort and milk receipts declined at the plant level. The Western region is reporting lower milk production, but not as severe as many had anticipated. Farms have improved their cooling systems, not only in the West but nationwide. The Class III milk futures were under pressure due to the decline in cheese prices. The trading volume was rather light. Class IV futures did not trade the entire day. USDA will release the World Agricultural Supply and Demand report on Friday. The report will provide the USDA's estimates for milk production, milk prices, and dairy product prices for this year and 2026.

AVERAGE CLASS III PRICES:

3 Month:	$17.88
6 Month:	$18.30
9 Month:	$18.20
12 Month:	$18.16

CHEESE:

Even though milk supplies to manufacturers have slowed, there is sufficient cheese available to the market. Demand has not improved to the level at which the supply is not keeping up with demand. Food service demand continues to lag compared to previous years. There is little reason for prices to increase, which is keeping end users unconcerned over the availability of supplies.

BUTTER:

It is uncertain whether the price may move higher to exceed the previous high set earlier this week, or if the buying today was just to fill immediate demand. It seems as if the price might stair-step higher as the summer progresses, but likely not move with the magnitude that it has in other years.

OUTSIDE MARKETS SUMMARY:

December corn closed up 1.00 cent per bushel at $4.1650, November soybeans closed up 6.50 cents at $10.1375 and December soybean meal closed up $2.40 per ton at $285.30. September Chicago wheat closed up 7.50 cents at $5.5450. August live cattle closed down $0.55 at $219.23. August crude oil is down $1.81 per barrel at $66.57. The Dow Jones Industrial Average is up 192 points at 44,651, with the NASDAQ up/down 19 points at 20,631.

Thursday Midday Dairy Market Summary - Sellers Pressure Cheese Prices

OUTSIDE MARKETS SUMMARY:

CORN:	2 Lower
SOYBEANS:	6 Lower
SOYBEAN MEAL:	$2.40 Higher
LIVE CATTLE:	$1.80 Lower
DOW JONES:	269 Points Higher
NASDAQ:	5 Points Higher
CRUDE OIL:	$1.66 Lower

MIDDAY MARKET UPDATE:

The block cheese price declined a penny, closing at $1.6850 with 21 loads traded. There were five unfilled bids remaining at the close of spot trading. The upside price potential for blocks will be limited as long as sellers continue to have large supplies to move to the market. The barrel cheese price declined 1.75 cents, closing at $1.71 with six loads traded. There were no unfilled bids or uncovered offers remaining at the close. The dry whey price declined 2.75 cents, closing at 56.25 cents with five loads traded. Class III futures are mixed, ranging from 15 cents lower to 11 cents higher. The butter price regained some of Wednesday's loss, increasing 2.75 cents to close at $2.59 with six loads traded. Grade A nonfat dry milk slipped 0.25 cent, closing at $1.2650 with seven loads traded. Class IV futures have not yet been traded. Butter futures are 0.02 cents lower to 0.95 cent higher. Dry whey futures are 0.72 cent lower to 0.75 cent higher.

Fluid Milk and Cream - Western U.S. Report 28

Milk production in California is generally decreasing; however, handlers convey decreases in milk production are less severe than anticipated for the months of June/July. Handlers suggest more moderate summer temperatures are a contributing factor for better than anticipated milk output. Stakeholders report some plant downtime negatively impacting processing capacities. Spot milk loads are reported at prices down to $1 below Class. Demands for all Classes are steady. According to the California Department of Water Resources, as of July 8, 2025, the state has received 21.79 inches of precipitation for the current 2024-25 Water Year, 1.03 inches below the historical mean. 

Farm level milk output in Arizona is lighter. Handlers report daytime temperatures into the triple digits and nighttime temperatures above 90 degrees. All Class demands are steady. 

Milk production in New Mexico is lighter. Demands for all Class manufacturers are steady. 

In the Pacific Northwest, farm-level milk output varies from steady to lighter. Some manufacturers note milk intakes above anticipated volumes. Stakeholders note several new processing facilities opening in 2025 are beginning to receive milk intakes. Class I, II, III and IV demands are steady. 

In the mountain states of Idaho, Utah, and Colorado, milk production is seasonally lighter. Spot milk availability is somewhat tighter. All Class demands are steady. 

Cream volumes are seasonally tighter and cream demand is strengthening. Cream multiples moved higher for the top end of both ranges. Condensed skim milk availability and demand remains steady.