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

Class III Futures

Cheese futures continued to slide lower Wednesday, but strength in dry whey futures helped the Class III market remain tight. Class III futures settled slightly higher in the front months, but Oct – June 2015 settled between unchanged and 13 cents lower. Wednesday’s USDA National Dairy Product Sales Report (NDPSR) was expected to provide more bearish news based on this recent trend, but instead the prices reported provided support for the market. Class III futures turned green in the afternoon session, trading between 4 and 23 cents higher through the end of the year.

Class IV Futures

Bullishness in the front months of butter and NFDM futures helped bring Class IV futures slight higher in August and September. However, the first four months of 2015 received a slight beating as the market settled 5 to 15 cents lower. The NDPSR showed a significant increase in butter prices in the U.S. , but the futures have not yet had any sort of reaction to this. 

CME Spot

Buyers were active again during Wednesday’s spot cheese market. Four cheddar blocks traded as the market moved two cents higher, and no cheddar barrels traded but bids pushed the market up half a penny. Spot NFDM continued to have aggressive sellers as loads were offered lower and lower until a pair traded at $1.5700. The spot butter market seems to be content with its current price level as nine loads traded Wednesday and the market settled right back where it opened. 

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