OVERVIEW:
Milk futures posted a strong close in response to the increase in spot prices. Trading volume was large, with the November contract showing more than 1,380 contracts and the December contract showing more than 1,100 contracts. The September Cold Storage report was not released.
MILK:
Milk futures posted a strong close, with Class III futures showing substantial gains from a week ago. The gain in cheese prices was limited, but futures rose significantly. Class IV futures did not share the same sentiment as contracts posted limited gains. Fundamentals did not change much, leaving traders with only speculation as to the strength of the underlying cash. The September Cold Storage report was not released today as scheduled due to the government shutdown. It is uncertain whether the milk production or cold storage reports would be released if the shutdown is settled. Likely, the information will only be reported on the next scheduled report date in November. Cattle futures were down limit today and ended a very negative week. January feeder cattle fell $19.50, while December live cattle fell $7.90. This does not mean the value of calves will decrease anytime soon, but it is something to be aware of as the government intends to lower beef prices.
AVERAGE CLASS III PRICES:
| 3 Month: | $17.36 |
| 6 Month: | $17.13 |
| 9 Month: | $17.10 |
| 12 Month: | $17.20 |
CHEESE:
For the week, blocks increased 0.25 cent with 32 loads traded. The weekly average price was $1.7605. Barrels remained unchanged with one load traded. The weekly average price was $1.7655. Dry whey increased 4.25 cents with three loads traded. The weekly average price was 67.70 cents. Barrels are reported to be in tighter supply. However, that is confusing, as that should have resulted in a price increase. It may indicate the market is balanced.
BUTTER:
For the week, butter increased 0.75 cent with 66 loads traded. The weekly average price was $1.5740. Grade A nonfat dry milk increased by 5.00 cents with 38 loads traded. The weekly average price was $1.1260. The majority of those loads were traded today.
OUTSIDE MARKETS SUMMARY:
December corn closed down 4.75 cents per bushel at $4.2325, November soybeans closed down 3.00 cents at $10.4175 and December soybean meal closed up $1.80 per ton at $294.10. December Chicago wheat closed down .50 cent at $5.1250. December live cattle closed down $7.25 at $233.93. December crude oil is down $0.37 per barrel at $61.42. The Dow Jones Industrial Average is up 473 points at 47,207, with the NASDAQ is up 263 points at 23,205.
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