Editor’s note: This market commentary is provided by Curtis Bosma at HighGround Dairy in Chicago, IL.

Class III Futures

Class III futures started the day very flat on Friday, but after a bearish spot cheese market they sold off to settle much lower. The July – September contract average settled at $21.30 (DOWN 0.42). Cheese futures fell off in the front months with August and September settling four and three cents lower, respectively. Whey futures also dipped today with the 3rd quarter average settling at 63.8333 cents (DOWN 0.6917). The bearish movement in Friday’s Class III futures should not send producers into a panic. Technical charts have shown Class III futures trading at or above resistance levels for the past couple of weeks. The market was due for a bit of a correction and we saw that happen on Friday.


Class IV Futures

The bearish trend in Class IV futures continued as contracts traded from unchanged to 20 cents lower on Friday. NFDM futures were the downward driver as they continued to sell off for the second day in a row. NFDM futures traded anywhere from 0.55 cents to 2.5 cents lower Friday with very light volume. Butter futures moved higher after another bullish spot session. July settled at $2.3000 (UP 0.0300), but still remains at a nine cent discount to spot.


CME Spot

After a few days of strong buying power in the spot cheese market the sellers showed up Friday and prices fell in both the blocks and barrels. Cheddar blocks finished out the week with a weekly average price of $2.0240 (UP 0.0040) and a volume of 14. The weekly average price for cheddar barrels settled at $2.0300 (UP 0.0370) and a volume of four. Spot NFDM showed very little demand this week and finished with a weekly average price of $1.8180 (DOWN 0.0070 vs. last week) with only three loads trading this week. Butter was the biggest bull in this week’s spot markets ending the week with a weekly average price of $2.3365 (UP 0.1160) with only four loads trading. Volume in butter was much lower than it has been in previous weeks, but it certainly was not due to a lack of buyer interest.

Disclaimer:  The risk of loss in trading futures and options can be substantial.  Past performance is not indicative of futures results.