June 16, 2023
The CME and Total Farm Marketing offices will be closed
Monday, June 19, in observance of Juneteenth
Milk Markets Sharply Lower On the Week
- The remaining quarters for 2023 took heavy losses on the week, Q3 and Q4 fell 62 and 10 cents in Class III, respectively, while Class IV Q3 and Q4 fell 30 and 33 cents, respectively.
- Despite domestic and foreign demand for cheese being in a good place, the spot cheese market fell 4 cents per pound this week.
- The second month Class III contract fell to its lowest weekly close since January of 2021.
- US dairy cow culling for the week ending June 3rd, up 6.1% from the same week last year.
Despite the continued selling pressure in the dairy markets, some reports of plants seeking out additional loads of milk in the Midwest surfaced this week. It is a good reminder of how quickly the markets can go from flush with milk to spot loads being sought after. The spot markets were relatively unchanged on the week with cheese down just over 4 cents per pound, powder down fractionally, and butter and whey slightly higher. Despite the relatively stagnant spot markets, milk prices still took the path of least resistance lower as both Class III and Class IV contracts fell to their lowest weekly closes since 2021. The dairy industry was quiet in fundamental reports this week but will receive plenty of information with a GDT event, Milk Production, Cattle on Feed, and Cold Storage reports. The CME and Total Farm Marketing offices will be closed Monday, June 19, in observance of Juneteenth.
Dry Weather Keeps Corn Climbing
- The December corn contract was able to close above the 200-day moving average today as short covering and technical buying on continued dryness in the Midwest.
- With forecasts trending dryer throughout the Grain Belt, futures jumped as funds are moving out of their short positions.
- The possibility of frost in Brazil has passed without issue for second crop corn as temps were seasonally cool. Current corn prices in Brazil equate to roughly $4.84 per bushel.
- Old crop export commitments remain at a 10-year low, down 35% below year-ago levels with continued pressure from cheaper export opportunities in South America.
- Ethanol production slipped below USDA expectations and week-ago levels at 1,018 tbd.
Meal Jumps To End Week
- Closing at their highest levels since March, November beans continue to rally as 51% of the soybean crop currently sits in drought.
- Board crush margins were raised today as meal and oil finished higher. Meal specifically shot higher with over $26 per ton gains between Thursday and Friday.
- Soybean exports, despite a recent USDA reduction, remain behind the USDA forecasts. Soymeal sales were in line with expectations are above year-ago levels.
- Soybean plantings and emergence are well ahead of recent averages but ratings slipped over the last week by 3%, down to 59% good-to-excellent.