March 31, 2023
Milk Markets Sour on Friday
Nearby Class III prices took a sharp turn lower during today’s trade with Class IV prices, again, staying fairly stagnant. After being rejected for the second straight week at $20 on the second month contract, April futures dropped 36 cents during Friday’s trade and 88 cents lower overall on the week. May and June Class III futures were also considerably lower today as well, with losses of 14 and 13 cents, respectively, during Friday’s action. Class IV price action for the second straight day was fairly sideways, only seeing the March contract higher and losses contained to the last four months of 2023. Much of the price action today can be attributed to additional downward pressure in the spot cheese market, giving up over 7 cents per pound today on nine loads traded and over 20-cent losses throughout this week’s trade. We saw the spot cheese market for four consecutive weeks, breaking the $2 per pound threshold last week, only to give up a majority of those gains in this week’s trade. Spot butter has seen range bound trading for the majority of 2023 with most weeks ending close to $2.30-2.40 per pound.
- Quarterly Class III prices for the week: Q2 down 62 cents to $18.65, Q3 up nearly 5 cents to $19.347, and Q4 nearly unchanged at $19.53
- Quarterly Class IV prices for the week: Q2 down 2 cents to $18.08, Q3 down 1 cent to $18.867, and Q4 down 9 cents at $19.493
- Changes to the Federal Milk Marketing Order are being proposed for the next Farm Bill
- Dairy Products on Monday, April 3, and GDT Auction set for Tuesday, April 4
- Due to strong opposition to some issues, pessimism continues to grow overseeing a new farm bill this year
- Intended Acres and Stocks Reports from today will be covered in below sections
Nearby Corn Supported By Reports
- Despite corn acres exceeding most estimates, corn stocks were lower than expected, down 357 million bushels from last year
- China continues heavy buying of US corn, during the week ending 3/23, China purchased 709,200 metric tons, a total of 3.383 million metric tons since 3/14
- Corn acres are expected to be nearly 92 million acres this year, up over 3.4 million acres from 2022
- The Buenos Aires Exchange kept their corn estimates unchanged at 36 mmt but last month’s WASDE estimate is still 4 mmt higher
Acres and Stocks Lifts Soy Complex
- The soybean complex was significantly higher during today’s trade
- Front month meal prices have jumped over $30 per ton from last Friday’s (3/24) low
- Soybean acres are set to increase from 2022 numbers but came in over 700k acres short of estimates
- Beyond the acreage estimates, soybean stocks were down 247 million bushels from last year, totaling 1.685 billion bushels
- Last week’s export shipments for soybeans were 38.2 mb and were well above the 16.5 mb needed each week to meet the USDA’s estimates
Friday’s Market Quotes
Author
Michael Minster