Fluid Milk and Cream - Western U.S. Report 37

Western region milk production is steady for Week 37. California is experiencing high heat this week, resulting in a small, temporary decline in volumes. According to contacts, milk remains available despite seasonal decreases. 

The Northwest continues to trend cooler, supporting improved cow comfort and consistent milk output. 

The Southwest reports stable milk volumes with no holiday-related issues. 

Class I demand remains steady as the pipeline transitions from school bottling back to standard operations. Class II and Class III demand show early holiday baking preparation patterns, while Class IV demand has eased, with prices trending lower. 

Cream loads are mostly available across the region, and some manufacturers report plants remained open through the holiday. Condensed skim milk (CSM) availability is tight, and specialty CSM is being sought for specific stakeholder needs. Milk-fat components have recovered following prior weeks of heat stress. Contacts report that plant capacity currently exceeds the volume of milk being received.

Thursday Midday Dairy Market Summary - Barrels Fall Hard

OUTSIDE MARKETS SUMMARY:

CORN:	3 Higher
SOYBEANS:	18 Higher
SOYBEAN MEAL:	$4.80 Higher
LIVE CATTLE:	$0.77 Higher
DOW JONES:	351 Points Lower
NASDAQ:	132 Points Lower
CRUDE OIL:	$5.92 Higher

MIDDAY MARKET UPDATE:

The block cheese price decreased a penny to close at $1.4600 with four loads traded. The barrel cheese price fell 7.00 cents to close at $1.4625 with 10 loads traded. This is nearly the number of loads that have been traded so far this entire year. There were four unfilled bids and one uncovered offer remaining at the close of spot trading. The dry whey price increased 0.25 cent to close at 76.00 cents with no loads traded. Class III futures are 31 cents lower to 1 cent higher. The butter price decreased a penny to close at $1.3700 with 34 loads traded. There were 19 unfilled bids and 54 uncovered offers remaining at the close of spot trading. This is the lowest price since January 16. Grade A nonfat dry milk increased 2.50 cents to close at $1.9400 with two loads traded. There were five unfilled bids and eight uncovered offers remaining. Class IV futures are 3 cents lower to 3 cents higher. Butter futures are 0.80 to 3.50 cents lower. Dry whey futures have not yet traded. Cheese futures are 1.90 cents lower to 0.30 cent higher. Nonfat dry milk futures are 0.37 to 2.95 cents higher.

Thursday Morning Dairy Market Update - US Bans Canadian Whey Protein

OPENING CALLS:

Class III Milk Futures:	5 to 10 Higher
Class IV Milk Futures:	5 to 10 Higher
Butter Futures:	Mixed

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	3 to 4 Higher
Soybean Futures:	5 to 7 Higher
Soybean Meal Futures:	$2 to $3 Higher
Wheat Futures:	2 to 3 Higher

MILK:

Milk futures were higher on Wednesday, with overnight trade indicating further strength this morning. Howver, traders will be cautious as the movement of the underlying cash is unpredictable. The overall fundamentals are not supportive of milk prices finding much upside price potential in the near term. It is questionable whether demand will be sufficient to tighten supplies and support prices. Butter and cheese have been unable to find solid support. The support for Class IV futures has been solely from the strength of nonfat dry milk. The U.S. will ban the imports of Canadian whey protein beginning September 29th. Cheese products have been excluded from the ban but will be subject to a 50 percent tariff.

CHEESE:

The block cheese price posted a minor gain on Wednesday, but it is not expected to result in a trend change. Buyers remain unaggressive as they can purchase cheese without having to chase the price higher. Slowly increasing milk production is keeping a sufficient supply of milk for manufacturing cheese, leaving it readily available for demand.

BUTTER:

It is uncertain whether the price will find support, similar to what it did the last time it was at this level. Cash traders do not trade the spot market technically, so that will not influence the market. It will only bounce if buyers turn more aggressive due to the low price. Howver, the upside will be limited as the supply is plentiful.