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

Class III futures settled anywhere from -26¢ to +7¢ yesterday. Since Dec. 1, the 1H 2015 pack has traded in a 25¢ range, and is currently at its low of $16.02/cwt. The full year 2015 pack is now trading near $16.51/cwt., slightly off its lows.

Both blocks and barrels continue to make new lows.  Barrels specifically have lost 64¢ since the first week  of November, and are now trading at a level not seen since June of 2013.

We are hearing cheese production is keeping pace with demand as last-minute holiday orders come in.  Little has changed fundamentally, with markets leaning towards the bearish end of the spectrum.   Internationally, Oceania production should be trending lower along seasonal levels, while year-over-year production is still expected to be higher.

Q1 2015 dry whey is trading at 46.458¢/lb., near its mid-November low.

Spot butter continues to trade near $2/lb., and has traded within a 12¢ range since the beginning of November.  As with cheese, the path of least resistance continues to be to the downside, but we expect this move to occur once we move past the holidays. 

NFDM also saw some weakness yesterday; the Q1 2015 pack hovers near $1.20/lb., and has been moving sideways for the last several weeks.

 

Dec. 8 spot session results:

Block cheese: $1.5800 (unchanged)

Barrel cheese: $1.5225 (down 2.75¢)

Grade A NFDM: $1.1100 (unchanged)

Butter: $1.9850 (unchanged)

 

Today's expectations:

• Class III, Cheese & Dry Whey futures to open slightly lower

• NFDM & Class IV futures to open steady to lower

• Butter futures to open mixed

 

Grain futures

Poor weekly export inspections pushed corn values lower yesterday. Soybeans settled slightly higher on another week of strong export inspections.

USDA’s World Ag Supply & Demand Estimates report will be released tomorrow, Dec. 10. More importantly, traders will be looking for a Jan. 12 report to answer questions surrounding planted acres and final yield.

 

Today’s expectation:

• Corn & Soybean futures to open steady to lower

 

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