Market News

Milk futures, cash dairy lower

Class III milk futures at the Chicago Mercantile Exchange were lower ahead of the USDA’s monthly milk production report. October was down $.01 at $16.60, November was $.37 lower at $15.72, December was down $.26 at $15.49, and January was $.19 lower at $15.18.

Cash cheese blocks were $.05 lower at $1.67. Two loads were sold, one at $1.67 and one at $1.6975. The last uncovered offer was for one load at $1.67. Barrels were down $.0075 at $1.64. Six loads were sold, including one at $1.64. The last uncovered offer was for one load at $1.66.

Butter was $.005 lower at $2.35. Three loads were sold, one at $2.35 and two at $2.3475. The last unfilled bid was on one load at $2.34. The last uncovered offer was for one load at $2.36.

Nonfat dry milk was down $.0175 at $.74. Nine loads were sold, including three at $.74. The last unfilled bid was on two loads at $.735. The last uncovered offer was for one load at $.745.

The USDA reports milk production over the past week was steady to lower in most of the U.S. Spot milk availability continues to be tight in the Midwest, while cream is plentiful. Bottling milk intakes are steady to higher and condensed skim demand is steady. Domestic butter demand is moderate with a number of manufacturers already reporting increasing holiday interest. Butter production is steady. Cheese production is also essentially unchanged, but some Midwestern plants have been down for maintenance. Cheese demand varies by region, but stocks are long. At the retail level, conventional dairy ads were up 8%, while organic ads were down 34%. The spread between organic and conventional half gallons of milk is $3.74, in favor of organic.