MARKETS

Calves and Heifers: How High Can These Prices Fly?

Thu, 04 Sep 2025 16:18:52 GMT

“We keep asking each other how the market can get any better.” This statement was the opening remark on a recent market report from Turlock Livestock Auction Yard, Turlock, Calif., which reported cattle prices continuing to post new highs. In the past month, Holstein springer values topped out at $4,000 and above in two reported markets, and the Turlock site reported potload values of $3,875 to $4,050 per head. Newborn calves, meanwhile, have soared into almost unthinkable territory, with Holstein heifer calves crossing the $1,000 per head mark in Pennsylvania, and beef-cross calves maxing out at more than $1,500 per head in two reported markets.

Shifting Tides in the Dairy Market: A Closer Look at Butter and Cheese Prices

Tue, 02 Sep 2025 21:27:08 GMT

The CME spot butter market continues to steal the attention as prices dropped another few cents. Can this market break $2? The answer will likely come sooner than most expected. Although USDA’s July report showed tighter inventories, supply appears ample to start September. Reports suggest demand for bulk butter remains soft, certainly compared to normal for this time of year. That’s likely adding to the heavier supply feeling. Spot cheese prices dipped slightly today as well, which combined with weaker spot butter ultimately knocked nearby Class III and IV prices down by more than a dime.

The CME butter market continued to fall, down $0.0325 to a new year-to-date low of $2.0125 per pound. One lot changed hands. Spot blocks slipped slightly, down a penny to $1.7650 per pound, with 13 loads exchanged. Barrels, NDM and dry whey were unchanged with no trades.

Most commodities dropped at today’s GlobalDairyTrade event on the highest volume offered season-to-date. Milk powders led the way, with WMP down 5.6% to $1.73 per pound and SMP down 4.9% to $1.19. Butter slipped 2.4% to $3.16 per pound (adjusted to 82% butterfat). Cheddar logged the only increase, up 3.5% to $2.14 per pound.

As of Aug. 31, 69% of the U.S. corn crop was in good or excellent condition compared to 71% last week and 59% on the five-year average. The soybean crop was 65% good or excellent, down from 69% last week, but up from the five-year average of 59%.

Your Next Read:
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Latest Milk Production Report Sets the Tone

Fri, 22 Aug 2025 20:43:51 GMT

Dairy futures traded lower again today on the heels of yesterday’s Milk Production report showing milk flows increasing at the strongest rate in four years. Spot block cheese dropped to a three-week low, while butter prices dipped to the lowest level since 2021. This weighed on Class III and Class IV markets, with Q4 futures making new year-to-date lows for both. USDA’s Cold Storage report was released after markets closed for the weekend, so those results will likely set the tone for trading next week.

Today’s Highlights:
It was red almost across the board today at the CME. Butter was down $0.0050 to settle at $2.235, the lowest price since December 2021. Spot blocks slipped 3¢ to $1.75 per pound, with six lots changing hands. Barrels dropped to $1.76, shedding a nickel with no trades. Nonfat dry milk held at $1.26 with six lots traded, while dry whey gave up 1.5¢ and closed at $0.5550 per pound.

Class III and IV futures also dropped, with Q4 Class III slipping to $17.74 per hundredweight, a 14¢ loss. Q4 Class IV declined to $18.04 per hundredweight, easing by 6¢. Q4 butter futures tumbled $0.0413 to $2.3828 per pound.

USDA’s July Cold Storage report was surprisingly bullish for butter. Stocks were down on the year and month-over-month at an above-average pace. It was more neutral for cheese, with inventories up versus 2024, but down on the month at a pace that was close to the five-year average.

The Tides are Shifting in the Class III Futures Market

Wed, 20 Aug 2025 20:18:39 GMT

The Class III futures market took a different turn from today’s cash session. Across the board, Class III traded lower with the vast majority of the day’s volume focused in the September and October 2025 contracts. Given the decline, the entire Class III futures curve is forecasting lower CME blocks from the current price point. The spot butter market remains under pressure. If we finish Friday at or below today’s settlement, this will be the first time we’ve ended a week below $2.30 since late April of this year. Butter futures are holding about a 20¢-per-pound premium to spots, effectively forecasting a rally in the spot price as early as October. All eyes will be on tomorrow’s Milk Production report, which follows last month’s higher-than-expected 3.3% year-over-year increase.

Today’s Highlights:
Class III contracts slipped lower on the day, with Q4 futures settling at $18.02 per hundredweight, a 16¢ loss. Class IV also dropped, down 17¢ to $18.33 per hundredweight.

Global milk powder prices remain in a tight cluster, with the weekly CME NDM average at $1.26 per pound, New Zealand at $1.25 and Europe at $1.26. The CME cheese average of $1.84 per pound is still far below New Zealand’s $2.06 and Europe’s $2.31. The butter price gap also remains wide, with the CME price at $2.31 per pound, New Zealand at $3.16 and Europe at $3.65.

USDA's Rollins: 'Let's Go Barnstorm The World And Find New Partners' For Trade

Tue, 18 Feb 2025 18:25:26 GMT

On Brooke Rollins’ first full week on the job as Secretary of Agriculture, she addressed the 600 farmers, ranchers and industry leaders in Kansas City for the 2025 Top Producer Summit.

High on Rollins’ list of priorities was the topic of trade and President Donald Trump’s vision for U.S. agriculture moving forward.

While Rollins did not shy away from addressing the administration’s decision to implement trade tariffs, noting “farmer and rancher concerns are legitimate,” she focused on what she sees as her role ahead.

“My job is to ensure that as President Trump and our trade representatives are making their decisions that I am in the room and advocating on behalf of our people, on behalf of all of you,” she told Top Producer Summit attendees.

One of her key objectives, she says, is to find and expand market access for U.S. agricultural products domestically and abroad.

“Let’s go barnstorm the world, and let’s go find some more trade partners and access [to market opportunities],” she says.

Rollins says her goals for trade are a reflection of Trump’s vision and his determination to make agriculture part of the “golden age” he sees ahead for the U.S.

Trump is the consummate deal maker, Rollins notes, able to side-step bureaucracy and red tape in the process to work with world leaders.

“I don’t know that in the last 250 years, we’ve had anyone in office like President Trump,” she says. “He is a very unusual, remarkable and fearless man, and he wants to make a deal, and in the best way, and put America first.”

Agriculture Secretary Brooke Rollins spoke to a crowd of 600 farmers, ranchers and industry leaders at the 2025 Top Producer Summit.

(Jim Barcus)

Making Headway With Trade
Sen. Roger Marshall of Kansas, who moderated the conversation with Rollins, highlighted Trump’s work to build trade during his first term.

“He redid USMCA, and now that’s our largest ag partnership, with Mexico and Canada,” Marshall says. “He gave us South Korea and Japan, which has been so important to Kansas and our cattle industry, as well as trade 1.0 with China.”

Marshall then mentioned the headway he believes Trump and team have made with India.

“I see India replacing China as our major trade partner, as well that China is growing right now,” Marshall says. “I think there’s huge opportunities in India.”

U.S. ethanol, cotton and tree nuts are three of the top agricultural exports to India, a country that has in the past impeded agricultural trade with tariffs and non-tariff barriers alike. Trump called out the barriers to trade following recent conversations with India’s Prime Minster Modi.

A joint statement after the Trump-Modi meeting said Washington welcomed New Delhi’s recent steps to lower tariffs on select U.S. products and increase market access to U.S. farm products, while seeking to negotiate the initial segments of a trade deal by the fall of 2025.

Rollins says the progress underway with India was just one step forward to address what she described as a trade crisis for the U.S.

“Our exports are down $37 billion this year and likely to be down $42 billion in the months to come. This is a crisis, and this is something that I understand inherently,” Rollins says.

“We have a tremendous amount of work to do,” she adds. “But my promise to you is this, and my commitment will never waver, that every minute of every day for the next four years, I will do everything within my power with hopefully God’s hand on all of us and our work to ensure that we are not just entering the golden age for America, as my boss, President Trump, likes to say, but that we are entering the golden age for agriculture.”

Secretary Rollins joined Chip Flory on AgriTalk. Listen to their discussion about trade policy and tariffs; avian flu; and disaster and economic aid.

Your next read: Senate Overwhelmingly Confirms Brooke Rollins as 33rd Secretary of Agriculture

Navigating Trade Wars, Tariffs and More in the New Year

Wed, 11 Dec 2024 18:55:38 GMT

As the ag industry prepares to flip the calendar and head into a new year, even experts and insiders have more questions than answers. The long-delayed farm bill and 45Z biofuels tax credit guidance have kept the industry in a frustrating limbo, while high interest rates and low commodity prices push it toward recession.

Some economists are already calling the current situation a recession. Arlan Suderman, chief commodities economist for StoneX, a financial services provider for global markets, is one of them.

“By definition, a recession is when you have back-to-back quarters of contraction in GDP [Gross Domestic Product],” he tells hosts Tyne Morgan and Clinton Griffith on Farm Journal’s Unscripted podcast. “We’re not growing as an industry, we’re contracting.”

However, he believes that comparisons to the 1980s, a historically bleak period for agriculture, are misguided.

“I don’t think we’re in that type of scenario,” he says. “Fortunately, as an industry, we’re not as highly leveraged as we were in the 1980s, particularly when you think of land. We have some safeguards in place.”

In fact, he tells the hosts that he’s more optimistic about the ag economy than he was just a few months ago, noting that a new tax policy and less regulation under the Trump administration could lead to renewed growth.

Suderman is also optimistic about global trade, foreseeing new agreements with major partners, such as Mexico, Canada and even China. Those countries, he says, are in weaker negotiating positions than they were during the first Trump administration. “We’re hearing from our people in China that maybe there might be some type of trade deal hopes,” he says. “That would mean more agricultural products bought from the United States in exchange for Trump easing up on tariffs on consumer goods.”

Of course, many challenges and questions will persist as the new administration takes over. How can the industry boost domestic demand for soybeans, corn and pork? Will the Trump administration show more support for biofuels than it did in its previous time in office? How can U.S. soybean exports succeed despite growing competition from countries such as Brazil and Argentina?

For Suderman, the clearest certainty is that changes will occur quickly in the new year. The president-elect knows that losing control of Congress in the mid-term elections is a possibility, so he will enact his new policies with as much speed as possible. “He has two years to get his agenda done,” Suderman says. “So we’re going to see things happen fast and furious.”

Watch the full episode of Unscripted

U.S. Crop Conditions Remain Above Average

Mon, 29 Jul 2024 20:48:48 GMT

CME block cheese made up ground lost during the tail end of last week, settling at $1.9500 per pound, two cents higher, with one lot traded. Barrels rose to $1.9750 per pound, up a half cent, with zero loads exchanged. Meanwhile, NDM trade remains healthy, with prices adding $0.0075 and climbing to $1.2400 per pound, with nine lots sold. Butter prices, however, slipped to $3.0875 per pound, giving up $0.0025, with two loads exchanged.

Producer margins remain noteworthy as Q4 Class III milk futures got a boost today, rising to $20.57 per hundredweight, up 11 cents, and Class IV Q4 prices remained steady at $21.41 per hundredweight. At the same time, nearby soybean futures tumbled to $10.5475 per bushel today, down 22.75 cents to the lowest price since November 2020.

Crop conditions across the country remain exemplary with 68% of the current corn crop rated good-to-excellent, a slight improvement from last week’s 67%. The soybean crop is performing well, too, with 67% of the crop rated good-to excellent, dipping marginally from last week’s 68%.

CME Cheese and Butter Markets are Quite Following Cold Storage

Fri, 26 Jul 2024 20:34:25 GMT

The spot market was relatively quiet, with the exception of whey, which jumped to $0.5700 per pound, tacking on three cents to reach the highest price since May 2022. Butter seemed to shake off yesterday’s Cold Storage report, dipping just slightly to $3.0925 per pound, $0.0025 lower. Cheese was also subdued, with both blocks and barrels maintaining yesterday’s prices of $1.9300 per pound and $1.9700 per pound, respectively.

The grain market took a tumble, with September corn falling back below $4 to settle at $3.9450 per bushel, down 11.5 cents. The nearby soybean contract slipped to $10.7750 per bushel, giving up 38.5 cents. Soybean meal also dipped to $353.30 per ton, giving up $9.90.

Stock indices rallied on Friday as the personal-consumption expenditures index – the Federal Reserve’s preferred inflation gauge – fell within expectations in June. The Dow Jones Industrial Average saw the largest gain, settling up roughly 1.7% on the day.

U.S. Milk Production Down in June; Spot Cheese, Nonfat Up

Tue, 23 Jul 2024 20:58:39 GMT

Even with a decline in WMP and SMP prices at the GlobalDairyTrade Pulse event, the CME NDM market advanced back above the $1.20-per-pound mark. Spot NDM added $0.0225 and settled at $1.2200 per pound, with nine lots exchanged. CME cheese markets also jumped higher. Spot blocks leapt 5.5 cents to end the day at $1.9300 per pound, while barrels climbed to $1.9600 per pound, 3.5 cents higher. Seven lots of blocks and one load of barrels traded.

USDA pegged U.S. milk production at 18.8 billion pounds in June. That was down 1.0% versus 2023, a bigger drop than anticipated. Ever.Ag estimates milk solids output rose 1.3% on the year. The Midwest (+1.1%) was the only major dairy region to log growth. California (-1.8%) and the Southwest (-1.9%) had the largest year-over-year decreases. The dairy herd totaled 9.335 million cows, up 2,000 head on the month, but 62,000 head below last year.

China’s dairy imports were a mixed bag in June. Inbound WMP and SMP volumes were down 29.8% and -46.5% year-over-year, respectively, while casein (-51.5%), high protein whey (-20.1%) and cheese (-2.9%) were also below prior-year levels. But butter imports jumped 20.8% compared to 2023, while whey (+6.2%) and infant formula (+5.8%) also advanced on the year.

Cheese Prices See a Boost, Crop Conditions Hold Steady

Mon, 22 Jul 2024 21:05:13 GMT

Spot cheese prices started the week off with an increase. CME blocks lifted to $1.8750 per pound, up a penny, with four lots traded. Barrels rose to $1.9250 per pound, tacking on $0.0125, with two loads exchanged. Meanwhile, butter prices held steady at $3.0750 per pound with six lots sold.
New Zealand started its 2024-2025 production season on weak footing. June milk production declined 2.2% on a milk solid basis and -1.1% on a tonnage basis.
Crop conditions are holding relatively steady through the dog days of summer. The corn crop was rated 67% good to excellent as of July 21, compared to 57% last year at this time. The soybean crop reached 68% rated good to excellent, well ahead of last year’s 54%.

Ever.Ag - The risk of loss trading commodity futures and options can be substantial. Investors should carefully consider the inherent risks in light of their financial condition. The information contained herein has been obtained from sources to be reliable, however, no independent verification has been made. The information contained herein is strictly the opinion of its author and not necessarily of Ever.Ag and is intended to be a solicitation. Past performance is not indicative of future results.

Market Watch Diary: (Slightly) Better Prices Ahead

Fri, 20 Nov 2020 02:33:24 GMT

**Extended comments highlighted in blue

with Jerry Dryer

Milk prices during the first half of 2012 have churned up plenty of unpleasant memories about the disastrous 2009 dairy markets, but it is time to look at the balance of 2012 and beyond.

It appears that the Class III price will average $15.75 in the first half of the year after averaging $16.28 in the first quarter. The Class IV price has been lower: $15.94 during the first quarter and looking as though it will average $14.80 through the first half of 2012.

These prices come on the heels of record highs established in 2011, when the Class III price averaged $18.37 and the Class IV price, $19.04. Hence, a lot of milk is being produced during the first half of 2012, up 4.1% during the first quarter. I estimate it will be up about 3% for the entire first half of the year.

It wasn’t just high prices that drove milk production: a very mild-mannered Mother Nature was supportive of production per cow. High beef prices kept the tail-enders headed to hamburger heaven, only to be replaced by a fresh wave of better animals.

With plenty of replacements available and the undying urge to make more milk, producers kept adding cows during the first half of the year. Now the question is, where does the market go from here?

If my crystal ball is functioning correctly, the second half of 2012 will witness two distinct markets: (1) Month-to-month Class III milk prices will hold relatively steady; but (2) Class IV prices will edge lower, especially during the third quarter. I expect to see some Class IV prices below $13.

On the Class III side of the ledger, demand for cheese and whey has been very strong this year. Cheese-friendly menus at fast-food restaurants have been attracting more customers and international buyers have been busy shopping in the U.S.

Grocers, who had not promoted cheese for 18 months, launched ads and discounted prices ahead of the Easter and Passover holidays and continue to advertise and reduce selected product prices.

High-end whey product sales are doing very well here at home and in the international marketplace. Dual-income households in Asia, to take one example, are buying more infant formula.

Class IV products, butter and nonfat dry milk, had to face a tougher market environment during the first half and are facing more of the same as we move toward year-end.

Historically, “butter-powder” plants have performed a “balancing” function. If milk bottlers and cheesemakers do not need the milk, it goes to butter-powder. That happened this year in spades, given that most of the plant capacity added over the past couple of years has been in butter-powder. Unfortunately, not enough capacity was added.

Plant operators were forced to make low-heat nonfat dry milk, the least desirable of the powders. It would have taken too long to make medium- and high-heat nonfat and skim milk powder, the products being sought by international buyers.

Butter inventories here and in Europe, and powder inventories worldwide, will hang over the market at least through the end of this year. Much of the powder is already in the hands of end users, so it won’t show up in the inventory numbers as reported by USDA.

My bottom line for the second half of 2012 looks much better than 2009, but it still isn’t very pretty. I expect the Class III price to average $16.25 in the second half of 2012 and the Class IV price to average $14.50.

Market Watch Diary: Milk Speculators

Fri, 20 Nov 2020 02:21:37 GMT

“Looking for the next gold? Try milk,” suggested a headline in the Nov. 9 issue of the Globe and Mail, Canada’s largest national newspaper.

The article, by investment columnist David Parkinson, recommended that investors play the commodity price run-up by buying Chicago Mercantile Exchange milk futures, which in early
November hadn’t yet followed the corn market higher.

Notwithstanding that the Canadians have a controlled dairy market that is isolated from global supply-demand forces, the advice strikes a couple of chords for those following the U.S. market.

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CME Group resources

CME Group: Class III Milk Futures

First, the fundamentals suggest it may take a while before milk catches up with corn. Because of lags in the pricing system, dairy producers were still receiving $18/cwt. for milk in November, even after commodity cheese and butter prices had crashed.

Milk production was up more than 3% in September and on track to post additional 3% to 4% gains in the fourth quarter. Milk volumes in Europe and New Zealand were expanding as well, putting pressure on international commodity prices.

By January, milk checks should reflect the weaker markets, but it could be several months after that before production finally responds. Margins will be pinched like they were in 2009.

For the first time in more than seven years, there will be no Cooperatives Working Together (CWT) herd retirement. Ironically, without CWT buyouts, we may see supply contract more quickly than in recent history.

While this adjustment is taking place, it’s difficult to know what impact retail investors will have
on milk futures. The Globe and Mail quotes Shawn Hackett, a Florida-based financial adviser who sees a “huge buying opportunity in milk.” Hackett has been “loading up on milk lately, and advising his clients to pour themselves a few glasses, too.”

If this behavior is replicated by investors around the world, it could result in a boost to milk futures that provides hedging opportunities for U.S. dairy producers.

Eventually, milk prices have to align with the cost of production. But given the time it takes for dairy markets to respond to price signals—and the propensity of milk supply to overcorrect—we’re setting up for very tight markets in the second half of 2011.

That could make the Globe and Mail’s investment recommendation look remarkably prescient, if off by several months.