GENERAL OVERVIEW:
Class III futures were under pressure in contracts through September. Class IV futures exploded with the minor increase in butter and continued gains in Grade A nonfat dry milk. Dairy exports did well in February.
MILK:
Class III futures in contracts through September were lower in response to the weakness in cheese prices. Class IV futures exploded higher with the May contract reaching $0.79 higher and June $0.80 higher at one time during the day. The Grade A nonfat dry milk price continued to increase to another new high with no indication of price resistance.
Strong international demand continued to drive milk solids equivalent export volume 13% higher compared to February 2025. It was the ninth consecutive month of growth. In the first two months of 2026, export volume increased 12% compared to the first two months of 2025. The value of exports was 11% above February 2025, with year-to date export value up 8% compared to the same period a year ago.
AVERAGE CLASS III PRICES:
| 3 Month: | $17.24 |
| 6 Month: | $17.81 |
| 9 Month: | $18.03 |
| 12 Month: | $17.93 |
CHEESE:
The Western region indicates cheese production is steady to increasing. However, manufacturers indicate that cheese inventory is not building to any large extent. Domestic demand is steady to stronger as spring approaches. The Western region indicates milk production may be at its peak of the spring flush, while most of the rest of the country is seeing the early stages of it.
BUTTER:
The increase in the butter price today does not indicate that support has been achieved. The price was likely low enough to generate increased buyer interest, as it makes sense to buy butter at the low price. The Grade A nonfat dry milk price continued higher as buyer interest remains strong. There is no indication of price resistance. The market will find a level of resistance at some point where demand will slow down.
OUTSIDE MARKETS SUMMARY:
May corn closed down 3.25 cents per bushel at $4.4400, May soybeans closed up 3.25 cents at $11.6525, and May soybean meal closed up $3.50 per ton at $317.60. May Chicago wheat closed down 5.75 cents at $5.7450. June live cattle closed up $1.28 at $247.20. May crude oil is up $4.40 per barrel at $98.81. The Dow Jones Industrial Average is up 276 points at 48,186, with the NASDAQ up/down 187 points at 22,822.
