Class III Milk futures finished mixed on light to moderate volume as traders consolidated their positions heading into the three day holiday weekend. CME Block cheese prices did manage to post a 2 ½ cent gain on bids only, but barrel prices held steady and traders could not get excited about another push to the upside. We were impressed with August futures hanging on to slight gains during Friday’s session – the premium being carried to CME spot cheese remains at nearly 10 cents/pound. Overnight, Class III futures are trading unchanged to eight cents higher on light volume and we expect some follow through buying as commodities in general are firm this morning.
Butter prices held steady on Friday and futures were quiet and mixed. Even with the weekend heat, butter futures are trading unchanged to a penny lower on light volume. Dry whey futures came off ¼ cent to 2 cents on Friday as traders try and test the premium that was put into the market over the past couple of weeks. The first half 2011 dry whey futures average is now $0.3275, down from $0.3500 from the previous Friday. NFDM futures were quiet on Friday with September trading a penny lower to $1.15/pound.
In what has been called by the media a “patriotic protest,” dairy farmers in New York and potentially other states dumped their milk on July 4 to protest low prices and send a message to lawmakers. While milk dumping has been talked about since prices collapsed at the beginning of 2009, we have not seen any of these movements gain any traction. We were impressed with the coverage that Dave and Robin Fitch from West Winfield, NY received with national coverage on Dairyline Radio, popular dairy blog “Cows and Crops”, and other TV, radio & newspaper outlets across the country. If any dairymen that read our daily email participated in this milk dump protest, please let us know.
Last weekend ended by the corn market removing 7 trading days worth of losses and fresh low prices in just two days on the heels of surprising USDA Reports. Users of corn suddenly found themselves way too short of inventory and needed to buy corn. Their buying combined with speculative short covering and new speculative buying spurred the corn market back up very near its June high.
Dave drove to
7/2 Class III Futures: Volume: 815 Open Interest (OI) Change: -412 (+249 w/o June) Total OI: 29,561
7/2 Class III Options: Est. Put Volume: 100 Total OI: 18,342 Est. Call Volume: 217 Total OI: 16,972
7/2 Spot Markets: Block Cheese $1.4550 (UP 2 1/2), Barrel Cheese $1.40 (UNCH), Butter $1.75 (UNCH), NFDM: A $1.2300 (UNCH), X $1.2450 (UNCH)
7/2 Other Dairy Futures Volume: Butter: 17 Dry Whey: 80 NFDM: 18 Class IV: 0 CHEESE: 2
7/2 Individual Cheese Futures Prices, Change, Volume & Open Interest
Jul $1.43 UNCH Vol: 0 OI Change: UNCH
Aug $1.526 UP .009 Vol: 1 OI Change: UP 1
Sep $1.581 UP .015 Vol: 0 OI Change: UNCH
Oct $1.583 UP .007 Vol: 0 OI Change: UNCH
Nov $1.562 UP .002 Vol: 0 OI Change: UNCH
Dec $1.566 UP .021 Vol: 1 OI Change: UP 1
7/2 Individual Class III Futures Prices, Change, Volume & Open Interest
Jul $13.45 DOWN 5 Vol: 61 OI Change: DOWN 10
Aug $14.36 UP 2 Vol: 361 OI Change: UP 103
Sep $14.82 DOWN 5 Vol: 155 OI Change: UP 49
Oct $14.86 UP 1 Vol: 90 OI Change: UP 32
Nov $14.72 UP 8 Vol: 34 OI Change: UP 27
Dec $14.59 UP 4 Vol: 22 OI Change: UP 4
Jul-Dec 2010 Avg: $14.47 UP 0.01/cwt
Jan-Dec 2011 Avg: $14.52 NO CHANGE