Editor’s note: This market commentary is provided by the Dairy Division at FCStone in Chicago, Ill.

  Class III futures were soft most of the session and closed anywhere from up 6¢ to down 13¢ on steady to lighter volume. It should be noted that we did see the market turn around after the pit close and go into positive territory all the way out to July of 2015. The 4Q 2014 pack average settled below the $20.00/cwt. level to $19.93/cwt., but also recovered after the close of the pit session, which was followed by overnight price increases as well.

The spot cheese session was strong again yesterday, moving up in both blocks and barrels. While the rest of the world continues on a down swing in their cheese prices, we still continue to be supported domestically. Does this mean we make a run back towards $2.30/lb.? We think not, but it does lend us to continue to have some near-term support for the spot market. Cheese futures were generally lower. As with the Class III markets, we did see prices jump after the close of the pit session.

Yesterday was one of the busiest trading days’ we have seen in a while for the whey markets, with prices generally higher.


August 6 spot session results:

Block cheese: $2.0900 (up 2.0¢)

Barrel cheese: $2.1075 (up 0.5¢)

Grade A NFDM: $1.5700 (down 2.0¢)

Butter: $2.4000 (unchanged)


Today's expectations:

• Class III, Cheese & Dry Whey to open higher

• Class IV to open soft

• Butter & NFDM to open weak


Grain futures 

Corn closed up 7¢ in the December contract, bouncing off recent lows in a technically oversold market.  Export inspections were stronger than expected and have the market looking towards today’s export numbers. There are also rumors circulating that Argentina may reduce corn export licenses. 

Soybeans traded 14.5¢ higher in November, closing within a penny of the highs.  This strength looks to be highly technical in nature. 

The aggression on the Ukraine border will continue to affect the grain markets. Russia announced that imports will be restricted from any sanctioning countries.  Many believe that this is undoable, since Russia imports 40% of their food. Russian opposition activists are suggesting that this will just lead to importers standing outside of government offices with suitcases of cash.   

Today’s expectation:

• Grain complex to open lower


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