Editor’s note: This market commentary is provided by the Dairy Division at FCStone in Chicago, Ill.
What a difference a day makes. Class III futures settled double-digit higher, with May leading the charge to settle up 30¢, and the remainder of 2014 displaying some strength, setting anywhere from +6¢ to +28¢. Cheddar blocks and barrels supported the firm tone, with blocks up 1¢, and barrels up an impressive 11.5¢. With cheese plants running at capacity, we expect yesterday’s activity to be indicative of choppy market action around $2.20/lb., rather then a renewal of the type of bullish activity that brought us over $2.30/lb. earlier in the year. Dry whey futures settled anywhere from unchanged to +1.5¢. The July through December pack is trading at 57.55¢/lb. There is little new fundamental news, and the 2H 2014 pack has been trading in a sideways pattern since mid-February.
NFDM futures settled the day mixed, while butter futures saw a bit of strength. Domestic demand seems to be decent, and these high prices have buyers buying hand to mouth.
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March 5 spot session results:
Block cheese: $2.2375 (up 1.0¢)
Barrel cheese: $2.2425 (up 11.5¢)
Grade A NFDM: $2.0275 (unchanged)
Butter: $1.88 (unchanged)
• Class III & Cheese to open soft
• Dry Whey to open lower
• Class IV, Butter & NFDM to open slightly lower
The grain markets had a quiet day as tensions cooled between Russia and Ukraine. Wheat and corn complexes settled down, with soybeans put up a mixed board. Focus is slowly starting to shift back to the U.S., as farmers start to plot planting intentions. There is still more than 50% snow cover in the lower 48 states, and freezing temperatures persist throughout a majority of the Corn Belt. USDA released a statement that there were cancellations of 9 million bushels of U.S. soybeans. Though this is not a huge volume, it is still noteworthy.
• Grain complex to open slightly soft
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