Milk Prices
With much of the Upper Midwest processing capacity maxed out in terms of milk production, finding a new home for milk is not an easy task. This is causing dairy farms to dump milk due to the oversupply.
The dairy industry stands as a backbone of American agriculture, and few have championed its cause as persistently and effectively as Vilsack. Earlier today, he spoke to attendees at World Dairy Expo in Madison, Wis.
Spot butter prices tumbled, giving up seven cents to reach $2.6800 per pound, the lowest level since January.
Class III futures through the rest of 2024 continued to decline, with the November contract down 27 cents to $22.61 per hundredweight.
Barrels continued to decline, landing at $2.1475 per pound and giving up 15 cents, the largest single-day drop since November 2020.
Butter and cheese prices have fallen substantially since the highs were established. The supply outlook has changed with reports indicating there should be sufficient supply through the end of the year.
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CME barrels continued to plunge, falling to $2.2975 per pound, shedding $0.1025 on the day and -$0.2925 from the Friday before.
Butter settled at $2.7900 per pound, giving up seven cents to reach the lowest price since March.
CME barrels plunged even further off recent all-time highs, ending today at $2.4275 per pound, $0.1175 lower.
Taking a look at the current national dairy supplies, one USDA economist says supplies remain relatively tight amid strong demand. Plus, how a community is coming together after a massive fire over the weekend at one of Ohio’s largest dairy farms.
Futures followed spot prices lower today, with Q4 Class III prices settling at $22.45 per hundredweight, 45 cents lower.
Friday’s Milk Production report, which showed there was more milk in August than expected, had a bearish effect on spot blocks and butter.
August milk production was down less-than expected, slipping 0.1% year-over-year.
Barrels continued to rise, reaching $2.6225 per pound and tacking on 5.75 cents to set yet another record-high price.
Supply concerns and rising global prices continued to drive CME barrels higher.
Seasonal demand is providing support to the market. This support may continue for a time as supply has tightened and demand is improving.
Harvest is underway across much of the Midwest, with 9% of the U.S. corn crop now in the bin, ahead of the five-year average of 6%.
The CME barrels market didn’t show signs of slowing its ascent, adding a nickel to reach $2.4850 per pound. That’s the highest price since November 2020.
EU cheese prices remain the most expensive in the global market place at $2.42 per pound,
CME cheese jumped to prices not seen since May 2022.
CME cheese led the charge today, with blocks jumping to $2.2700 per pound, adding on four cents to reach a price not seen since June 2022.
Midwest spot prices are $1.75 above class, up from +$1.25 last week and well ahead of the five-year average of -$0.25 at this time
The past few weeks have shown us that the markets are becoming increasingly volatile. The months of September and October will see that volatility continue. Seasonal buying has increased fueled by the potential for tighter inventory.
It was green across the board today in Chicago, with CME cheese rebounding and finishing strong.
Class III futures followed CME cheese prices higher. Q4 contracts prices lifted to $22.16 per hundredweight, up 28 cents.
Experts are predicting that Dairy Margin Coverage (DMC) will average between $11.85/cwt and $12.20/cwt during 2024.
CME cheese took a tumble today, with barrels dropping to $2.1250 per pound
Butter continued its post-Cold Storage climb, adding $0.0225 to reach a new year-to-date high of $3.1975 per pound.
Tips for producers to maximize making money now that the profit equation is finally in favor of dairy.
After ending last week with a tumble, CME cheese markets began this week with a surge, thanks in large part to USDA’s bullish Cold Storage report.