GENERAL OVERVIEW:
Class III futures found greater strength through the end of the day, with some contracts posting double-digit gains. Today was the last day to trade November contracts, with the Federal Order prices to be announced on Wednesday.
MILK:
Class III milk futures were higher into the close despite further weakness in the spot cheese prices. The hope is that prices may have found a bottom, but there is no solid evidence of that currently. The time of year makes it difficult for prices to show much upside price potential, as most of the holiday season buying has been finished. Fill-in orders will continue to be met and may trigger more aggressive buying for a short period. The November Federal Order class prices will be announced on Wednesday. The trade estimates a Class III price of $17.16 and a Class IV price of $13.83.
AVERAGE CLASS III PRICES:
| 3 Month: | $15.61 |
| 6 Month: | $15.88 |
| 9 Month: | $16.26 |
| 12 Month: | $16.56 |
CHEESE:
Both blocks and barrels made new lows for the year as prices are unable to find a bottom. The continued weakness moving toward the end of the year does not bode well for early next year when demand is seasonally slower. Cheese production is heavy with plants wanting to move products quickly, even at lower prices, to keep from building up supplies at the plant level.
BUTTER:
The butter price may have moved into a holding pattern for the time being, as retail demand has improved for the holiday season. Churns are running seven days a week to process the available cream. This keeps a sufficient supply readily available for demand. We will not know inventory levels until Dec. 23, when USDA releases the cold storage reports that will hopefully bring the information up to date.
OUTSIDE MARKETS SUMMARY:
March corn closed up 5.00 cents per bushel at $4.5000, January soybeans closed down 3.25 cents at $11.2475 and January soybean meal closed down $3.00 per ton at $311.60. March Chicago wheat closed up 6.00 cents at $5.4100. February live cattle closed up $4.88 at $220.80. January crude oil is down $0.71 per barrel at $58.61. The Dow Jones Industrial Average is up 185 points at 47,474, with the NASDAQ up 138 points at 23,414.
