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

The Class III futures market finished last week’s trade with the 2013 contracts settling between 2 cents lower and 5 higher on a total of just 633 trades. The 2013 second-quarter futures pack closed out the week at the price of $17.66, one cent higher for the day, while 7 cents lower week over week. 

Milk production in New Zealand for the month January was up 4 percent year over year, but should fail to reach such a lofty result for the remainder of their season, as the entire North Island has been designated a drought zone and the pasture growth rates have been non-existent.  

Spot session results:

Block cheese: $1.61 (up 1 cent)

Barrel cheese $1.59 (unchanged)

Grade A NFDM: $1.50 (up 0. 25 cent)

Butter: $1.655 (up 1.5 cent)

Friday trading session for the grain markets resulted in price declines across the board. The May corn contract ended the day shedding 3 ¼ cents to settle at $7.13 ¾, 10 ¼ cents higher over the week prior. The December corn contract fell just 2 ½ cents to $5.59 ¼, while gaining a total of 12 ¼ cents for the week. The May soybean contract closed out Friday’s trade down 9 ¾ cents to $14.16 ¼, while dropping 54 ¾ cents throughout the week. The May wheat contact fell 5 /14 cents on the day to settle at $7.17 ¾, while gaining 20 ¾ cents week over week.

The overnight session saw grains hit lower from the EU news as “risk-off” mentality hit essentially all markets. By morning, we were off our lows but not by much.

We look for corn to open 4 to 6 cents lower and beans to open 12 to 17 lower.

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