This Week in Dairy 07-29-2022

July 29, 2022



Tumultuous Week to End Volatile July

Class III futures posted a positive weekly close with the August contract up 18 cents and September gaining 42, an impressive feat seeing Wednesday and Thursday’s losses totaled $1.00 and 91 cents, respectively. This leaves a tail on the charts for these contracts with a break off the early week high, but the oversold nature of the markets and the fact $20.00 held on the continuous second month chart is encouraging.  Spot cheese had an equally wild week, gaining 3.6250 cents in Friday’s trade, but dropping 3.1250 cents on the week to $1.88375/lb, the lowest weekly close in 2022. Things were quieter for Class IV, which saw its August contract up 34 cents this week to close at $24.81, as that market tries to re-establish an upswing after a moderate selloff in recent weeks.

  • For the month of July, August Class III futures fell $2.41 cwt, while spot cheese plummeted 31.1250 cents
  • Within the Class IV market, the month of July saw the August contract fall $0.42 cwt, while spot butter dropped half a cent
  • Attention will shift to the September contracts on the rolling second month charts next week. It will be important for Class III support to hold at $20.00
  • Spot butter has strung together nine weeks of trade between $2.90/lb and $3.00/lb


 

Corn Posts Strong Recovery

– September 2022 corn jumped 55 cents this week while the new crop contract rallied 55.75 cents to push both contracts back over $6.00

– There was enough concern with the updated forecasts into early and mid-August to add some weather premium back into prices

– China’s corn imports were down 38.2% YoY at 2.21 million tons and were down 11% in the first six months of 2022 vs. the same time period in 2021

– Brazil and China are revisiting on a trade protocol to allow Brazil to ship corn to China sooner than originally established

– FCStone estimates the US corn yield at 174.5 bpa vs. the latest estimate from the USDA at 177.0 bpa


Soybean Meal Break Out of Recent Range

– September soybean meal rallied $43.10/ton on the week to $442.40, back near contract highs from March

– The soybean complex found hefty buying this week thanks to a more threatening forecast for August

– Private exporters sold 132,000 metric tons of 2022/23 soybeans to unknown destinations on Friday

– FCStone estimates the average US soybean yield at 51.9 bpa, up slightly from the current USDA estimate of 51.5 bpa


 

Friday’s Market Quotes

Author

Dustin Jonasson

Sign up to get daily TFM Market Updates straight to your email!

back to TFM Market Updates