GENERAL OVERVIEW:
The GDT Auction took place earlier Tuesday with an average winning price of $4,021, up 2.5% from Oct. 6. Cheddar had the biggest decrease from the previous auction, while Buttermilk Powder gained the most in value.
MILK:
Class III milk futures started off Tuesday strong, with the November contract trading over 40 cents higher. By the last trade of the day, the November contract had lost some ground, only 25 cents higher on the day. The settlement taking place in early afternoon still had the market up 39 cents at that time. The deferred 2027 contracts were all lower by the final bell. Class IV had minimal trading for the day, with the last trades unchanged to 4 cents higher. Wednesday, Class I and II prices will be announced, and later this week will be the Milk Production Report. To follow along with the USDA's Dairy Outlook report, the market expects milk production, while still historically high, to be reduced from the previous report.
AVERAGE CLASS III PRICES:
| 3 Month: | $17.05 |
| 6 Month: | $17.31 |
| 9 Month: | $17.43 |
| 12 Month: | $17.55 |
CHEESE:
The spot market for cheese has been on a major rally lately. Tuesday was no different, with Cheddar Blocks climbing another 7 cents and Barrels 8 cents higher. Cheese futures were higher as well, with the November contract up 3.5 cents near the close. The GDT was off pretty hard from the auction two weeks ago for Cheddar. Cheddar was down 7.4% at $3,645/MT. Mozzarella, on the other hand, was up 1.3%.
BUTTER:
Butter futures were mixed Tuesday afternoon, trading anywhere from down 0.5 cents to up 0.5 cents. Cash markets were 2.5 cents lower on the day with only one trade. There were a lot of outstanding bids and offers, 51 and 73 respectively, but prices were too far apart to make a trade. The GDT Auction had butter down 0.4% from the Oct. 6 event, coming in at $4,721/MT.The Cold Storage Report will be released Friday to give the market a better look at butter supplies available. Milk powders were the biggest demand of the auction, with increases in each category. Butter Milk Powder had the highest increase from the previous report, up 8.4% from two weeks ago.
OUTSIDE MARKETS SUMMARY:
December corn closed down 5 cents per bushel at $4.62; November soybeans closed down 5.25 cents at $12.4825 and December soybean meal closed down $6.10 per ton at $348.70. December Chicago wheat closed down 12 cents at $6.4325.
December live cattle closed up 1.950 at $229.45. November crude oil is down $1.87 per barrel at $97.82. The Dow Jones Industrial Average is up 529 points at 52,495 and the NASDAQ is down 6 points at 26,424.
