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On Cows and Markets

By E. W. Lang

There's some good news on the dairy farm today. Block cheese ended the week up seven cents at $1.9975 per lb., the highest price for that commodity since November, 2014. That's almost five years ago, and an eternity in terms of financial suffering for milk producers nationwide.

So, is our long, national nightmare over? Yes, no, I don't know.

Barrel cheese closed 25 cents under blocks, and are "more available," according to reports, where blocks are called "tight."

Butter lost a couple cents this week, cream is called "plentiful," spot loads of milk are 50 cents under Class price to a dollar over, milk solid exports are pretty poor, and US butter production was up 6% year-over-year in July.

September Class III Milk Futures gained 34 cents this week, closing today at $17.96, which is near the contract high of $18.08, per cwt., hit three times in early July. October gained six cents and is currently $17.72 per cwt

And now for the rest of the story...

Nov., 2019 through August, 2020 lost two to 16 cents in each Class III trading month, even after this week's seven cent gain in cash block price. The average Class III price for the rest of this year is $17.50, and for 2020 it's $16.70 per cwt.

Milk-Feed Indices are $10.75 for September, $10.53 for October, and $10 plus small change in November and December. Those historically high $10+ income over corn/soy feed prices are partly the result of recent, horrific losses in corn price - which is currently at a 52 week low - and very close to the lowest cash corn prices that we have seen since 2007. Beans aren't far behind. Cash grain producers suffer and milk producers benefit, so is the price of economic freedom here in the United States.

In other markets, dairy slaughter values are generally steady with last week, as are hay prices. Top end dairy cows at public auction are "trending higher."

There were two dairy sales reporting on Wednesday. Fresh and close cows ran from $1600 to $2000 in Withee, Wisconsin. Dairy cows were mostly $8,000 to $210,000 at auction in Copake, New York.

The NY dairy auction is reported here, for those who may be interested.

Cows selling for $50,000 to $200,000 are the result of combining both the art and science of animal breeding with the human, emotional lure of showring exhibition and the irrational, moving excitement of a public auction.

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