This Week In Dairy 03-03-2023

March 3, 2023


Mixed Day for Dairy

Despite some green on the board today, most of the dairy complex was lower on the week. Nearby prices for Class III and IV found gains today with heavier losses throughout Class III from July ’23 through March ’24. The nearby gains were likely attributed to active purchasing in the spot cheese trade where prices may have found recent support. A trendline dating back to the middle of 2020 on the second month Class III contract continues to provide support on current levels. Dairy slaughter rates are well above levels from last year. To date, 406k head have been slaughtered, roughly 21.5k head above last year’s levels, these cull rates did not slow down the growth of the dairy herd which grew 9k head from December to January. Today’s Dairy Production Report showed year-over-year growth in production and inventories for most dairy products in the month of January. US butter production was up 3.8%, total cheese production up 3.2%, powder production up 2.8% with a rise in inventories, and whey production was conversely down 9.7% but inventories up 27.7%.


  • Quarterly Class III prices for the week:  Q1 up 2 cents to $18.33, Q2 down 24 cents to $17.89, Q3 down 25 cents to $19.25, and Q4 down 21 cents to $19.55
  • Quarterly Class IV prices for the week: Q1 down 9 cent to $19.12, Q2 down 56 cents to $18.72, Q3 down 50 cents to $19.57, and Q4 up 3 cents at $20.11
  • Cheese blocks are continuing a large premium on barrels, likely supply driven, at 37.5 cents currently
  • Spot basis for Class III has been reported between -10.00 and -2.50


Corn Bounces After Big Fall

  • Five consecutive days of heavy selling pressure ended Wednesday for corn futures, the May contract found support at $6.30/bu and ended the week at $6.39
  • Corn futures are trading higher again as US corn prices begin to get more competitive in the world marketplace
  • Last week’s export sales of 23.5 mb were only half the needed amount to meet the USDA’s expectations
  • Ethanol production for the week ending 2/24 fell from previous weeks and is barely above levels from a year ago: production remains below levels needed to reach the USDA corn usage forecast
  • The Biden Administration is recommending that some Midwest cities be allowed to offer E15 gasoline year-round (starting in 2024)
  • Brazil’s corn exports in February at 89 million bushels were below initial estimates but well above the same time last year; Brazil’s corn exports going forward are expected to light until the arrival of their 2nd crop harvest this summer

Soybean Meal Recovers From Massive Drop

  • May meal futures slipped nearly $15 per ton lower on Tuesday, only to recover and value by the close of trade on Friday, support appears to be in place near $465 per ton with resistance just below $490 per ton
  • The soybean complex found support from rumors of Chinese demand and a strong economic report from China
  • Brazil’s soybean exports for February were 5.2 million tons (191 million bushels) down from 6.27 million tons in the same month last year
  • US soybeans crushed in January were reported at 191.1 million bushels; This was slightly above expectations but down from the 194.3 million bushels in the same month last year
  • Some private estimates are putting the Argentina soybean crop 6-8 mmt below the USDA’s estimate of 41 mmt


Friday’s Market Quotes



Michael Minster

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