Class III prices continued yesterday’s limit moves, opening red and trading as much as 30 cents lower in nearby months. After the spot auction, futures attempted to claw back from some of their losses before settling the day lower. While cheese prices have largely moved in sync with Class III prices, whey futures have shown a newfound aggressiveness to sell off, fueling further concern into potential points of support for Class III prices. Market participants will turn towards Friday’s Milk Production and Cold Storagereports for new color on market fundamentals.
Today’s Highlights from Ever.Ag’s Know Your Markets
- CME barrels continued to drop, down another four cents to $1.8100 per pound. Blocks eased to $1.7750 per pound, just a half cent lower following yesterday’s plunge. Four loads of each changed hands. For the first time in weeks, spot dry whey broke out of its mid-$0.70s range. Prices dropped to $0.7000 per pound, shedding $0.0375 to the lowest price since November, with four lots trading. Butter also declined, down $0.0125 to $2.5225 per pound, with three lots exchanged.
- Class III futures tumbled further today, with the February contract leading the way, down 46 cents to $18.97 per hundredweight. Q2 futures fell to $18.86 per hundredweight, landing below $19 for the first time this year.
- US NDM prices dipped while New Zealand and EU SMP prices rose, narrowing the gap. The US price eased to $1.35 per pound while New Zealand and Europe advanced to $1.21 and $1.19, respectively. The gap widened for cheese and butter. US cheese settled at $1.82 per pound compared to $2.20 in New Zealand and $2.28 in Europe. In the US, butter slipped to $2.53 per pound, while New Zealand butter ticked up to $3.09 and Europe rose to $3.52.
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