Monday Midday Dairy Market Summary - Cheese Prices Fall Significantly

OUTSIDE MARKETS SUMMARY:

CORN:	2 Higher
SOYBEANS:	20 Higher
SOYBEAN MEAL:	$1.70 Lower
LIVE CATTLE:	$2.47 Higher
DOW JONES:	207 Points Lower
NASDAQ:	168 Points Higher
CRUDE OIL:	$0.22 Higher

MIDDAY MARKET UPDATE:

The block cheese price fell apart, falling 10.25 cents to close at $1.6650 with two loads traded. This is the lowest price since Sept. 29 and takes the prices near the low of the trading range. There were two unfilled bids and seven uncovered offers remaining at the close. The barrel price fell 5.50 cents, closing at $1.7500 with no loads traded and an uncovered offer setting the lower price. The dry whey price remained unchanged at 71.00 cents with no loads traded. Class III futures are 22 cents lower to 5 cents higher. The butter price declined 3.25 cents, nearly eliminating the gain of Friday, with six loads traded. The Grade A nonfat dry milk price slipped 0.25 cent to close at $1.13 with one load traded. Class IV futures are 4 to 10 cents lower. Butter futures are 0.50 to 5.25 cents lower. Dry whey futures are 1.25 cents lower. Cheese futures are 3.10 cents lower to 0.30 cent higher.

Monday Morning Dairy Market Update - Fundamentals Point to Further Weakness

OPENING CALLS:

Class III Milk Futures:	4 to 10 Lower
Class IV Milk Futures:	Mixed
Butter Futures:	Steady to 1 Higher

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	5 to 8 Higher
Soybean Futures:	2 to 6 Higher
Soybean Meal Futures:	Mixed
Wheat Futures:	4 to 7 Higher

MILK:

Class III milk futures are expected to see pressure ahead of spot trading. There is a strong possibility that cheese prices might see further weakness. There is sufficient milk available for bottling and manufacturing, with milk production seasonally increasing. Higher milk production is not overwhelming the market but is being utilized without difficulty. Spot milk prices are steady to $2.00 higher than class, indicating steady demand. Class III milk futures closed lower for the week and may see further weakness this week, possibly retesting the lows over the next few weeks.

CHEESE:

Cheese buyers might be less aggressive today to begin the week, as buyers may hold back in the spot market due to the weakness on Friday. Cheese supplies are sufficient, with price movement based on the demand for fresh cheese. Price may remain in a range at best.

BUTTER:

The strength of butter is expected to be short lived as there are plentiful supplies available for demand. Strong churning activity and higher butterfat content keep the supply of cream readily available. This may limit the drawdown of butter inventories.