GENERAL OVERVIEW:
Class III futures were mixed, with pressure on nearby contracts due to further weakness of block cheese. Class IV futures were mostly higher on the increase in butter and nonfat dry milk. January fluid milk sales declined 2.3% from January 2025.
MILK:
Most milk futures contracts showed further gains on Thursday. The confidence of those who have been bullish due to the cold storage report is being tested, as the block cheese price has declined since the report. If there is another day of weakness, liquidation could be triggered. Fluid milk sales in January were 2.3% lower than a year earlier. Whole milk sales increased 1.6%; flavored whole milk jumped 17.8%; reduced fat declined 5.2%; low-fat milk fell 10.3%; flavored fat-reduced milk declined 6.2%; buttermilk sales declined 2.5%; and other fluid milk products increased 2.2%. Organic whole milk sales declined 2.4%; organic flavored whole milk jumped 16.1%; organic reduced-fat milk declined 3.1%; organic low-fat milk sales fell 24.9%; organic fat-free milk declined 15.7%; organic flavored fat-reduced milk sales fell 28.3%; and other organic milk products fell 65.4% from January 2025.
AVERAGE CLASS III PRICES:
| 3 Month: | $17.22 |
| 6 Month: | $17.95 |
| 9 Month: | $18.22 |
| 12 Month: | $18.11 |
CHEESE:
The spot cheese prices have not responded as many had anticipated after the February Cold Storage report showed a decline in American cheese stocks from January, with inventory 3.0% below February 2025. The weakness of block cheese over the past two days has had little impact on Class III futures. Buyers have not been aggressive, resulting in sellers lowering their offers.
BUTTER:
The spot butter price has responded to another month of inventory remaining 17% below the previous year. Sellers have been offering loads to the spot market, but buyers have purchased those loads, resulting in minor gains. The spot price pushed higher early during spot trading as buyers wanted to take advantage of the lower price. However, gains were trimmed due to sellers willing to take advantage of the aggressive buying and offering loads aggressively. So far this week, there have been 103 loads of butter traded.
OUTSIDE MARKETS SUMMARY:
May corn closed down 0.25 cent per bushel at $4.6700, May soybeans closed up 2 cents at $11.7375, and May soybean meal closed up $2.30 per ton at $322.10. May Chicago wheat closed up 7.25 cents at $6.0500. June live cattle closed up $0.95 at $234.80. May crude oil is up $3.34 per barrel at $93.66. The Dow Jones Industrial Average is down 469 points at 45,960, with the NASDAQ down 522 points at 21,408.
