This Week In Dairy 06-03-2022

June 3, 2022


Milk Starts June Off Strong

While the July Class III contract was pretty quiet this week, settling down a couple pennies to start the new month, most deferred contracts closed with solid gains. The Q4 average added 23 cents to retest its recent high from mid-April, while the Q1 average rallied nearly 50 cents to push back near the $22.00 mark. Spot cheese dropped 3.00 cents this week with a close at 2.2275/lb, closing lower 8 of the last 11 sessions, after posting a new 2022 high on May 18th. Whey prices were able to post their first consecutive weekly gains since January, but Class III futures will likely find it hard to trade much higher if the block/barrel average cannot find some footing.

Class IV price action was a force this week with every remaining 2022 futures hitting a new contract high, while most 2023 contracts moved back up near recent peaks. Butter was the main catalyst with spot prices matching the high from January on Thursday at $2.9350/lb and second month futures moving to just beneath all-time highs from 2014. The Class IV second month chart hit a new all-time high at $26.12, a nearly 10% extension off the previous best ever from eight years ago. Next week should be an exciting one, as it entails a GDT Auction, the April Dairy Export report, and the June WASDE report.


Corn Falls Sharply

– July corn futures dropped 50.25 cents this week to fall to $7.27, while new crop gave back 40 cents with a $6.90 finish

– This was the worst work for front month corn in almost a year and pushes the continuous chart back beneath the 2021 high

– Russia announced it was opening “humanitarian corridors” in order to let grain-carrying ships out of Black Sea ports

– As of May 29th, the USDA reported the US is 86% finished planting, versus a 5-year average of 87%

– Export sales were down 52% from the prior 4-week average today at 185,800 metric tons

– Brazil’s second corn crop is expected to be a record as harvest kicks off

Soybean Meal Post Rough Week

– After two weeks of higher closes, July soybean meal futures dropped $24.40/ton this week to close at $407.90

– As of May 29th, the USDA reported the US is 66% finished planting, versus a 5-year average of 67%

– The Buenos Aires Grains Exchanged pegged Argentina’s soybean production at 43.3 million metric tons, up from 42 mmt previously as harvest is nearing completion

– Old crop soybean sales were a marketing year low at 111,600 metric tons, down 60% from last week


Friday’s Market Quotes


Dustin Jonasson

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