Friday Morning Dairy Market Update - No Overnight Trading Activity

OPENING CALLS:

Class III Milk Futures:	Mixed
Class IV Milk Futures:	Mixed
Butter Futures:	Steady to 1 Lower

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	1 to 3 Higher
Soybean Futures:	3 to 6 Higher
Soybean Meal Futures:	$2 to $3 Higher
Wheat Futures:	Steady to 2 Higher

MILK:

Milk futures could not find strength Thursday with underlying cash prices showing nothing for traders to hang their hats on. Overnight trade showed no activity with bid and offers rather wide. Without any solid direction of cash, milk futures continue to drift lower. Milk output has not yet been affected negatively by lower milk prices. Milk production has remained higher than a year ago as milk per cow continues to improve. USDA will release the January Dairy Products report Friday, providing the volume of dairy products produced during the month. This will be compared to a year ago and the previous month to get an idea of demand.

CHEESE:

Traders who had anticipated low cheese prices to increase buyer interest and demand have been disappointed. Business is being done, but only when the price is right, keeping prices rangebound. There is no significant demand event on the horizon, leaving it to regular demand to move prices. Cheese stocks are lower than a year ago but historically large.

BUTTER:

Price has now taken back half of its gain since late January and has moved to the lowest price since Feb. 1. Even greater buyer interest with some buyers already working on third quarter contracts, price has not been able to trend hi

Thursday Closing Dairy Market Update - Milk Futures Slide

MILK

Class III milk futures settled 4 to 10 cents lower, while Class IV was 4 cents lower for March. Class IV April and May had no trades. Milk production is reported to be steady to higher across the country. While cream is available for all end users, demand is lower compared to recent weeks. Recent winter weather in the Midwest held up some milk deliveries. With schools done with spring break, fluid demand has slightly increased. The National Dairy Products Sales report was released yesterday afternoon, ending for the week of February 25. Average spot prices for butter were at $2.44 per pound, slipping 0.1 cents from the previous week. Cheese blocks declined 2.5 cents to average $1.93 per pound. Barrels were at $1.62 per pound, falling 2.7 cents. Dry whey price moved 0.4 cent higher to 40.3 cents per pound. Grade A nonfat dry milk averaged $1.23 per pound, moving 1.8 cents lower from the previous week.

AVERAGE CLASS III PRICES

3 Month:	$17.65
6 Month:	$18.26
9 Month:	$18.77
12 Month:	$18.88

CHEESE

Milk is readily available across the country, and cheese plants are able to operate strong production schedules. Cream cheese production and demand have increased in recent weeks. Italian-type cheese demand is much stronger than cheddar. Retail and food service demand is steady. It's noted that demand from pizza producers has lightened and are below forecasted sales. Export demand is mixed. While Asian markets are interested, other major countries are not. There are reports of more barrels sales than block sales on the spot market, though there is more barrel inventory than block. The cheese markets are in the middle, neither bullish nor bearish. Nonfat dry milk futures saw no trading for March. Dry whey futures were 0.25 cents higher.

BUTTER

Butter plants are actively churning and stocking up in preparation for the spring holidays as cream is abundant in most areas. Most of the butter produced will either be put into frozen storage or used to meet contractual retail demand. Retail and food service demand is steady. It's reported that spot loads are harder to come by, at least in the East, due to processor's preferences to freeze in bulk. Butter futures settled 3 cents lower.

OUTSIDE MARKETS SUMMARY

Corn futures for March slipped 2.75 cents to settle at $6.3775. March soybeans were up 15.50 cents to close at $15.1975 per bushel. March soybean meal gained $2.00 to $489.30 per ton. March wheat moved 4.25 cents higher to end at $7.0125. April live cattle fell $1.02 to close at $164.10. April crude oil increased 46 cents to settle at $78.16 per barrel. The NASDAQ increased 83 points to 11,462, and the Dow jumped 341 points to 33,003.

Thursday Midday Dairy Market Summary - Mixed Spot Prices

OUTSIDE MARKETS SUMMARY:

CORN:	4 Lower
SOYBEANS:	16.25 Higher
SOYBEAN MEAL:	$0.80 Higher
LIVE CATTLE:	$0.95 Lower
DOW JONES:	175 Points Higher
NASDAQ:	26 Points Lower
CRUDE OIL:	$0.21 Higher

MIDDAY MARKET UPDATE:

Cheese blocks moved a penny higher to close at $1.9100 with four loads traded. Barrels continued their decline, moving 2.25 cents lower to $1.5300 with three loads traded. Class III futures were 7 to 12 cents lower. Butter price fell 3.50 cents, closing at $2.4350 with two loads traded. Grade A nonfat dry milk was up 0.25 cent to $1.1800 with three loads traded. Dry whey declined 1.25 cents, closing at $0.4350 with one load traded. Dry whey futures were up 0.25 cent to 0.50 cent lower. Class IV milk futures haven't seen any trading yet. Butter futures traded 3.50 to 4 cents lower. The USDA will release the Dairy Products report tomorrow.