GENERAL OVERVIEW:
Class III milk futures closed under pressure due to the declining cheese and dry whey prices. October milk production was 3.7% higher in the country. Cow numbers declined from September. Cheese and butter production in August increased from a year earlier.
MILK:
The October Milk Production report was both bullish and bearish. Milk production in the top 24 states totaled 18.7 billion pounds, up 3.9% from October 2024. Production per cow was 30 pounds higher, averaging 2,049 pounds. Cow numbers decreased by 7,000 head from September. Milk output in the country increased by 3.7%, totaling 19.5 billion pounds. Milk output per cow averaged 2,033 pounds, up 29 pounds from October 2024. Cow numbers were 6,000 head less than in September. Milk prices may have been low enough with limited upside potential based on current futures prices to increase the need to cull more heavily. There were only three states that showed a decline in milk production. Washington declined 7.3%, New Mexico declined 4.4%, and Pennsylvania was down 0.5%. The state with the largest gain was Kansas with an increase of 21.2%. It was followed by South Dakota with a gain of 9.3% and Florida with an increase of 9.1%. California milk output jumped 6.9%.
AVERAGE CLASS III PRICES:
| 3 Month: | $16.17 |
| 6 Month: | $15.97 |
| 9 Month: | $16.23 |
| 12 Month: | $16.51 |
CHEESE:
For the week, blocks remained unchanged with 24 loads traded. Barrels declined 6 cents with no loads traded. This is the third consecutive week with no load of barrels traded on the spot market. The August Dairy Products report was released, which showed American cheese production up 0.3% from August 2024, totaling 474 million pounds. Italian-type cheese production totaled 510 million pounds, up 1.8% from a year ago. Total cheese output reached 1.20 billion pounds, up 0.5% from August 2024. Dry whey production was 68.3 million pounds, up 4.7%.
BUTTER:
For the week, butter fell 9.75 cents with 17 loads traded. Grade A nonfat dry milk remained unchanged, with 30 loads traded. Butter production totaled 173 million pounds in August, up 8.1% from August 2024. Nonfat dry milk production was 6.8% higher, totaling 123.0 million pounds. Skim milk production totaled 42.3 million pounds, down 13.1%.
OUTSIDE MARKETS SUMMARY:
December corn closed down 1.00 cent per bushel at $4.2550, January soybeans closed up 2.50 cents at $11.2500 and January soybean meal closed up $1.60 per ton at $319.20. March Chicago wheat closed down 1.00 cent at $5.3975. February live cattle closed down $0.63 at $214.78. January crude oil is down $1.02 per barrel at $57.98. The Dow Jones Industrial Average is up 493 points at 46,245, with the NASDAQ up 195 points at 22,273.
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