Tuesday Midday Dairy Market Summary - Cheese Holds Steady for the Second Day

OUTSIDE MARKETS SUMMARY:

CORN:	4 Lower
SOYBEANS:	5 Lower
SOYBEAN MEAL:	$1.90 Higher
LIVE CATTLE:	$0.05 Lower
DOW JONES:	119 Points Higher
NASDAQ:	63 Points Lower
CRUDE OIL:	$0.86 Lower

MIDDAY MARKET UPDATE:

Both block and barrel cheese prices remained unchanged at $1.6425 and $1.66, respectively. This is the second consecutive day of steady prices. Only an unfilled for a load of blocks and an uncovered offer for a load of barrels remained at the close of spot trading. The dry whey prices declined 1.50 cents, closing at 54.75 cents with one load traded. Traders do not like the steady cheese prices with pressure on Class III futures again today. Contracts are 2 to 12 cents lower. The butter price declined 2.25 cents, closing at $2.4775 with five loads traded. Grade A nonfat dry milk increased 0.25 cent, closing at $1.3025 with one load traded. Butter moved to the lowest price since May 30, while nonfat dry milk moved to the highest price since Feb. 10. Class IV futures have not yet been traded. Butter futures are 1.00 cents lower to 1.47 cents higher. Dry whey futures are 0.22 cent lower to 0.47 cent higher. USDA will release the June Milk Production report this afternoon. I estimate milk production to be 1.5% higher than June 2024 and cow numbers to increase 3,000 head from May.

Tuesday Morning Dairy Market Update - June Milk Production Report Released Today

OPENING CALLS:

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

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	4 to 5 Lower
Soybean Futures:	4 to 6 Lower
Soybean Meal Futures:	$0.50 to $1 Lower
Wheat Futures:	1 to 2 Lower

MILK:

Limited volatility is anticipated today unless there is a significant move in underlying cash prices. However, that is not expected as the market seems to be balanced. Milk production is sufficient for bottling and manufacturing needs. Lower milk receipts have increased spot milk prices but have not tightened supply. USDA will release the June Milk Production report this afternoon. It is expected to show higher milk production than a year ago. I estimate milk production to be 1.5% higher than June 2024. I estimate cow numbers have increased by 3,000 head from May. The June Cold Storage report will be released on Friday.

CHEESE:

Cheese prices have been holding but have not had sufficient buying interest to push prices higher. Blocks had unfilled bids under the market on Monday, with buyers unwilling to increase those bids to accomplish business. The market seems to be balanced with little reason for prices to increase.

BUTTER:

Butter has not been able to find a bottom as buyers have sufficient supply. They are willing to buy, but at lower prices. A significant amount of butter was purchased earlier and stored when the price was lower. This may limit the need for buyers to be aggressive later in the year. Manufacturers will continue to offer butter on the spot market to limit inventory build at the plant level.

Monday Closing Dairy Market Update - Dairy Traders Remain Bearish

OVERVIEW:

Class III milk futures did not improve ahead of the close. With little direction from the underlying cash, there is no reason for traders to turn bullish on the market. USDA will release the June Milk Production report on Tuesday.

MILK:

It may be very difficult for traders to turn bullish on this market. The current fundamentals do not suggest strength in milk prices anytime soon. We should see seasonal buying in the underlying cash markets, as buyers look ahead to second-half demand. However, there is little reason to be concerned over supplies at the current time. Milk production was above last year for the first five months of the year, and the June Milk Production report is expected to show continued gains over last year. I estimate June milk production to be 1.5% above June 2024. Cow numbers are expected to have increased, with my estimate at 3,000 head more than May. Milk replacement prices remain high, and farmers hang onto cows. The corn crop continues to do well with 74% of the crop in good/excellent condition compared to 67% last year. Soybeans are 68% good/excellent and the same as a year ago.

AVERAGE CLASS III PRICES:

3 Month:	$17.71
6 Month:	$18.08
9 Month:	$18.03
12 Month:	$18.03

CHEESE:

There was buying interest for block cheese during spot trading, but the interest was at lower prices. The recent activity in the spot market gives the impression that buyers and sellers are comfortable at the current price level. Demand remains steady and has not been improving as it should be at this time of year. Cheese supplies remain plentiful.

BUTTER:

The butter price has been in a downtrend and has been unable to find support. The price was anticipated to increase through the summer as buyers purchased for the upcoming fall demand. However, that has not developed with buyers having already purchased a supply of butter ahead of time. There have been some weeks during which over 100 loads of butter had changed hands in the spot market.

OUTSIDE MARKETS SUMMARY:

December corn closed down 5.50 cents per bushel at $4.2225, November soybeans closed down 9.75 cents at $10.2600 and December soybean meal closed down $4.00 per ton at $284.80. September Chicago wheat closed down 4.00 cents at $5.4225. August live cattle closed up $1.68 at $225.23. September crude oil is down .31 per barrel at $65.74. The Dow Jones Industrial Average is down 19.12 points at 44,323.07 and NASDAQ is up 78.51 points at 20,974.17.