GENERAL OVERVIEW:
The weakness does not stop. Spot prices are making another leg down as selling intensifies. Nonfat dry milk showed exceptional weakness as buyers step back. Dairy cattle slaughter increased from the previous year.
MILK:
Milk futures took another beating, with Class IV contracts hit harder than Class III. The weakness in Grade A nonfat dry milk took quite a bit of premium out of the market. The bearishness of the market has increased and may be difficult to overcome anytime soon. Dairy farms are pushing as much milk as possible to compensate for lower milk prices. Dairy cattle slaughter in April totaled 215,100 head, down 24,100 head from March. Slaughter increased by 7,900 head from April 2025. This stands to reason due to the higher cow numbers. Higher cow numbers would increase the volume of cows that might move to slaughter, but it would not reduce the herd. USDA will release the April Milk Production report on Friday.
AVERAGE CLASS III PRICES:
| 3 Month: | $16.83 |
| 6 Month: | $17.46 |
| 9 Month: | $17.65 |
| 12 Month: | $17.67 |
CHEESE:
The block cheese price lost most of what it gained on Wednesday. The barrel cheese price declined to the lowest level it has been since February 19th. Buyers continue to hold back in the spot market, waiting for sellers to lower prices. Buyers remained willing to purchase supplies, but only at a lower level. As long as sellers remain aggressive, buyers will remain complacent.
BUTTER:
Butter is unable to find a bottom and is heading back to the lows from the beginning of the year. The large decline in Grade A nonfat dry milk moved the price to the lowest level since April 9th and the largest one-day decline since September 19, 2008. The daily price calculation for class prices showed the Class IV price declining by $1.01 per cwt today, just in the decline of nonfat dry milk alone.
OUTSIDE MARKETS SUMMARY:
July corn closed down 3.50 cents per bushel at $4.6225, July soybeans closed down 5.50 cents at $11.9425 and July soybean meal closed down $2.50 per ton at $328.40. July Chicago wheat closed down 13.00 cents at $6.4750. August live cattle closed down $5.95 at $239.35. July crude oil is down $1.91 per barrel at $96.35. The Dow Jones Industrial Average is up 276 points at 50,286, with the NASDAQ up 23 points at 26,293.
