On the Chicago Mercantile Exchange milk futures were mostly lower Thursday while cash markets were mixed. Selling pressure entered the Class III space following spot cheese trade. It seems as if the market is looking for further verification of dairy finding favour following the announcement of an additional $1 billion going into the Farmer to Family Food Box program. Ultimately, details beyond the announcement remain vague. Cash settled cheese futures have also built carry into the fourth quarter of 2020. Some of that carry premium was removed today as October declined 2.25 cents/lb and November/December dropped 3.50 cents/lb, respectively. Class III weakened 27 cents in September, 16 in October, 27 in November, and 33 in December. January also lost 26 cents while the remaining months in 2021 were down single digits. Class IV markets were mainly unchanged.
In spot trade, dry whey up $0.0050 at $0.3350. Three sales were made at $0.33 and $0.3325. Blocks down $0.0075 at $1.8650. Six trades were made ranging from $1.8650 to $1.89. Barrels up $0.0025 at $1.44. Nine trades were made ranging from $1.4325 to $1.4525. Butter down $0.0325 at $1.4675. Seventeen trades were made ranging from $1.4650 to $1.4850. Nonfat dry milk down $0.0050 at $1.0150. Three sales were made at $1.0125 and $1.0150.
Grain prices rose once again as weather, exports, and managed money continues to drive the market. Hot and dry weather throughout August has caused concern regarding the 2020 crop. The U.S. drought monitor shows the entire state of Iowa as at a minimum of “abnormally dry” or worse. Northern Illinois/Indiana also shows dry spots with southern Michigan showing up this week too. Exports were either within expectations or exceeded them this morning. Flash sales of corn to China helped run December corn 4.25 cents/bu higher on the day to $3.585/bu. Soybeans took out resistance and ended 17.75 cents higher at $9.42/bu. The wheat complex gained 7-11 cents/cwt as well.
