OVERVIEW:
Class III futures are mixed with nearby contracts lower, while contracts in the second half of 2026 were higher. The gain in barrels provided little for traders to get excited about. Class IV futures were lower as the weakness of nonfat dry milk offset the gain in butter.
MILK:
Dairy Market News reported that milk production is on the rise in the Northeast region of the country, as cooler weather contributed to improved cow comfort and an increase in milk output. Milk components are improving and remain higher than a year ago. The higher butterfat content provides sufficient cream for churning. According to the UN Food and Agriculture Organization (FAO). Dairy prices worldwide have been declining. Milk output has been increasing in numerous countries, resulting in more supply than demand. Less expensive feed and good weather have fueled the gain in milk production in the U.S. The increase in cow numbers has been much the result of high replacement prices and high prices for beef-on-dairy calves, and strong cull cow prices. Both the world milk situation and domestic fundamentals are not going to change anytime soon.
AVERAGE CLASS III PRICES:
| 3 Month: | $16.57 |
| 6 Month: | $16.49 |
| 9 Month: | $16.54 |
| 12 Month: | $16.86 |
CHEESE:
Spot milk prices are holding rather steady this week, with prices ranging from 0.25 cent under to $2.00 over class. Demand for milk for cheese production is steady and has not been increasing as usual for this time of year. International cheese demand continues to remain strong, as reported by some sources. Due to the government shutdown, the export figures for August have not been updated.
BUTTER:
The demand for butter is slowly improving, but it has not translated into a significant increase in price. The cream supply is increasing, keeping churns operating on full schedules. This will provide a larger supply of butter, which will reduce the need to dip into inventory heavily.
OUTSIDE MARKETS SUMMARY:
December corn closed up 3.75 cents per bushel at $4.1675, November soybeans closed steady at $10.0650 and December soybean meal closed up $1.60 per ton at $275.90. December Chicago wheat closed down 1.50 cents at $4.9875. December live cattle closed up $0.28 at $246.78. November crude oil is down $0.43 per barrel at $58.27. The Dow Jones Industrial Average is down 17 points at 46,253, with the NASDAQ up/down 148 points at 22,670.
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