OVERVIEW:
Class III nearby futures closed higher as they were supported by stronger spot cheese prices. Later contracts were mixed as traders did not want to support the futures for next year unless there was a change in trend. The August Federal Order prices were released and showed an increase in the Class III price and a decrease in Classes II and IV.
MILK:
Class III futures have rebounded around $1.00 per cwt from the lows of a week ago. This improves the outlook for milk prices, but the increase does not mean prices will remain, and the current futures prices are not much to write home about. At least the September Class III price was better than August, being announced at $17.59, up $0.35, but the price is down $5.75 per cwt from September 2024. The Class II price was announced at $17.39, down $1.79 from August and down $5.01 from a year ago. The Class IV price is $16.17, down $2.33 from August and down $6.12 from September 2024. The average soybean meal price has not been released, which is missing from the calculation of the August income over feed price. This will not be released until the government shutdown is over. There was not going to be a Dairy Margin Coverage program payment anyway, so it will not have an impact on dairy farms.
AVERAGE CLASS III PRICES:
| 3 Month: | $17.36 |
| 6 Month: | $17.20 |
| 9 Month: | $17.15 |
| 12 Month: | $17.23 |
CHEESE:
Block cheese has had three consecutive days of gains. The price is now 14.50 cents from the low that was established on September 22. Hopefully, a delayed seasonal buying event has kicked in, which will continue to support the market.
BUTTER:
The butter price may chop around at a higher level and develop a sideways trading pattern. This may build some support and limit further downside price weakness for the time being. Once buyers have met their immediate needs, they may be unwilling to remain aggressive in the market.
OUTSIDE MARKETS SUMMARY:
December corn closed up 1.00 cent per bushel at $4.1650, November soybeans closed up 11.25 cents at $10.1300 and December soybean meal closed up $.30 per ton at $273.60. December Chicago wheat closed up 1.25 cents at $5.0925. December live cattle closed down $0.28 at $234.50. November crude oil is down $0.59 per barrel at $61.78. The Dow Jones Industrial Average is up 43 points at 46,441, with the NASDAQ up 95 points at 22,755.
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