Market News

Milk futures, cash dairy mixed

In Class III trade at the Chicago Mercantile Exchange, milk futures were mixed, mostly steady to firm, on expectations for lower production during the latter half of the year, along with lower feed prices. August was unchanged at $16.97, September was steady at $17.10, October held at $16.77, and November was up $.02 at $16.46.

Cash cheese was lower. Blocks were down $.01 at $1.78. The last uncovered offer was for one load at that price. Barrels were $.015 lower at $1.865. The last offer uncovered was for one load, also at $1.865.

Butter was up $.03 at $2.25. The last unfilled bid was on one load at that price.

Nonfat dry milk was down $.01 at $.8325. There were a total of four loads sold, including one at the closing price. The last unfilled bid was on one load at $.82. The last uncovered offer was for one load at $.8325.

The USDA lowered its 2016 milk production estimate to 212.1 billion pounds, down 300 million from the July guess. The average price for all milk is now expected to be $16.25 to $16.45 per hundredweight, compared to $15.55 to $15.85 a month ago. Class III is estimated at $14.80 to $15 and Class IV is pegged at $ $13.75 to $14.05.On the fat basis, commercial exports are now seen at 8.5 billion pounds with ending stocks at 13.5 billion. On the skim basis, commercial exports are expected to be 37.1 billion pounds with ending stocks of 13.6 billion. The average cheese price is pegged at $1.61 to $1.63 and butter is estimated at $2.14 to $2.18, with nonfat dry milk at $.795 to $.815 and dry whey at $.255 to $.275.

For 2017, production is projected at 215.8 billion pounds, up slightly on the month. The average price for all milk is estimated at $16.15 to $17.15, compared to $15.70 to $16.70 last month. On the fat basis, commercial exports are seen at 8.7 billion pounds with ending stocks of 13 billion. On the skim basis, commercial exports are expected to be 37.4 billion pounds with ending stocks of 13.3 billion. The average 2017 price of cheese is estimated at $1.615 to $1.715 with butter at $1.965 to $2.095. The average price for nonfat dry milk is seen at $.865 to $.935 with dry whey at $.285 to $.315.