OVERVIEW:
Class III futures were under pressure with the slight decline of the block cheese price. The bearish attitude prevalent in the market is keeping futures from any upside price retracement. Class IV futures closed higher, but that provided little consolation for producers. Dairy cattle slaughter declined in August.
MILK:
Milk futures have little underlying support to cause prices to trend higher. Milk production is improving seasonally as cow comfort improves. Cheese and butter production remains steady to higher. Cow numbers are increasing as farmers hold on to cows that generally would have been culled due to lower milk production. However, that cow is paid for, and it will produce another calf that will be worth a lot of money, making up for the reduced milk production. The next lactation has often turned out to be an improvement in production. The USDA released the August Livestock Slaughter report, which showed dairy cattle slaughter totaling 217,400 head. This was down 8,400 head from July and down 13,300 head from August 2024. This is the lowest August slaughter since 2007.
AVERAGE CLASS III PRICES:
| 3 Month: | $16.88 |
| 6 Month: | $16.82 |
| 9 Month: | $16.88 |
| 12 Month: | $16.96 |
CHEESE:
Cheese is readily available to the market, keeping buyers unaggressive. Buyers are not concerned about supply. The August Cold Storage report will be released on Friday. The inventory of cheese is expected to decrease, but it may be at a slower pace than a year ago and historically.
BUTTER:
Butter continued to be weak. The bounce today was good to see, but it might be short-lived. The volume of butter being traded on the spot market is satisfying immediate demand and meeting expected demand if manufacturers remain aggressive in moving supplies. Churning is active and will improve as more cream becomes available.
OUTSIDE MARKETS SUMMARY:
December corn closed up 1.50 cents per bushel at $4.2575, November soybeans closed up 3.25 cents at $10.1225 and December soybean meal closed down $2.90 per ton at $273.20. December Chicago wheat closed up 7.50 cents at $5.2700. December live cattle closed down $2.53 at $234.30. November crude oil is down $0.01 per barrel at $64.98. The Dow Jones Industrial Average is down 174 points at 45,947, with the NASDAQ down 113 points at 22,385.
.jpg)
