Class III markets popped higher today, with January – March futures all settling above $20.00 per hundredweight. And it’s just in time, as the Q1 DRP deadline is coming tomorrow. If you need any more coverage, take a close look at today’s values. Today’s Q1 Class III DRP has a $19.14 trigger price for 21 cents, which is a level that would have triggered a claim in nine of the past 10 years. Class IV DRP comes with a $19.76 trigger price for 13 cents, which would have paid in eight of the past 10 years. At current feed prices, those levels should help ensure a positive margin for early next year.
Today’s Highlights
- CME spot dry whey hit another milestone, adding $0.0175 to reach $0.7675 per pound, the highest level since February 2022. Spot cheddar prices also rose, with blocks settling at $1.7875 per pound, $0.0375 higher, and barrels finishing at $1.7300 per pound, a 5.5-cent gain. Volume: zero lots of whey, six loads of blocks and four lots of barrels.
- Supported by upward momentum in spot cheese and whey, Class III and cheese futures jumped. The January Class III contract increased to $20.25 per hundredweight, up 73 cents. January “all cheese” futures climbed to $1.8750 per pound, taking on $0.0680.
- Fluid bottling demands have reportedly eased, loosening spot milk supplies in the Upper Midwest. USDA reported spot prices in the region at $0.25 per hundredweight under class, down from +$0.50 last week, though up from -$1.50 last year and the five-year average of -$1.30. Meanwhile, cream is readily available in the region, bringing Midwest multiples to 124 this week, down from 125 last week and the five-year average of 128, and in line with last year’s 124.
