GENERAL OVERVIEW:
Class III milk futures began to strengthen as the afternoon progressed, with most contracts moving into positive territory by the close of trading. Dairy exports in October continued at their strong pace.
MILK:
The block cheese price showed strength as the afternoon progressed. Traders determined that the block cheese price rebounding from initial losses provided some support to the market. The barrel cheese price declined slightly, but that was immaterial as barrels are not used in the Federal Order price calculations. However, traders remain cautious, and the increase in blocks did not trigger significant buying interest. Dairy exports in October increased substantially, with exports on a milk solids equivalent basis up 7.0% from October 2024. Year-to-date exports are 2.3% higher than the same period a year ago. The value of exports in October increased 17.0% to $837.1 million. The year-to-date value of exports totaled more than $8.0 billion. President Trump signed the bill to allow whole milk and 2.0% milk back into schools. The law also permits schools to serve nondairy milk that meets the nutritional standards of milk and requires schools to offer a nondairy alternative if kids provide a note from their parents, not just from doctors, saying they have a dietary restriction. This should improve milk consumption, as many did not like having a choice of only 1.0% and skim milk. However, that will not tighten the milk supply anytime soon.
AVERAGE CLASS III PRICES:
| 3 Month: | $14.92 |
| 6 Month: | $15.55 |
| 9 Month: | $16.19 |
| 12 Month: | $16.51 |
CHEESE:
Cheese exports in October totaled 55,060 metric tons, up 35.8% from October 2024. Year-to-date exports are 19.0% above the same period last year. Lactose exports totaled 34,825 metric tons, down 9.6% from a year ago. Year-to-date exports are 0.8% lower. Whey exports totaled 41,203 metric tons, up 2.5% from a year ago, with year-to-date exports down 3.0%. Whey protein concentrate +80 exports totaled 6,589 metric tons, down 17.4%. Year-to-date exports are 7.3% above a year ago.
BUTTER:
Butterfat export in October continued at a strong pace with an increase of 132.7% above October 2024, totaling 10,510 metric tons. Year-to-date exports are 147.2% higher than in the same period last year. Nonfat dry milk/skim milk powder exports totaled 61,523 metric tons, up 0.3% from a year ago. Year-to-date exports are down 12.2%. Whole milk powder exports reached 3,197 metric tons, up 120.6% from October 2024, with year-to-date exports up 45.5%.
OUTSIDE MARKETS SUMMARY:
March corn closed down 1.75 cents per bushel at $4.2025, March soybeans closed up 10.50 cents at $10.5300, and March soybean meal closed down $2.70 per ton at $289.20. March Chicago wheat closed down 2.00 cents at $5.1050. February live cattle closed up $0.90 at $236.05. February crude oil is down $2.73 per barrel at $59.29. The Dow Jones Industrial Average is up 293 points at 49,442, with the NASDAQ up 58 points at 23,530.
