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On Cows and Markets

By E. W. Lang

USDA offered two separate Section 32 cheese solicitations this week totalling 8.8 million pounds of potential cheese purchases for delivery between November 19 and February 20.   Wendy's, our delicious hamburger friends, announced they will start serving delicious breakfast next year, possibly gobbling up another 10 million pounds of delicious cheddar cheese.   And rumors surfaced that a western cheese producer ran into some production problems.

Markets, in turn, responded with block and barrel cheese gaining 21 and 18 cents in the cash markets over the last five trading days.  Class III milk gained $1.48 per cwt. in October and 99 cents in November, with October ending at $19.20 and November at $18.35 per cwt.  

It seems that no one saw any of that coming. 

Cheese use has been further enhanced on the periphery by school and colleges firing up and higher demand from folk make and sell pizzas.  Or pizzae, if you prefer. 

Nearby milk prices are reminiscent of 2014. 

Market fundamentals, less so. 

Spot loads of Class III have been running 50 cents under to $1.75 over Class, similar in range to each of the last two years during September.   Processing plants in AZ, CO, and ID are running at full capacity, and discounts on homeless Class IV tankers of milk out there are reported by USDA's Dairy Market News at $4.75 under Class before they can find a willing buyer. 

 Corn and Soy prices gained a fair amount this past week, but Milk-Feed Indices still average near $11 per cwt. for the rest of this year.  Producer calls to dairy cattle dealers wanting close and fresh cows are frequent.  Also frequent are producer calls to dealers and auctioneers wishing to liquidate, if they can do so at a manageable equity level with their lender.  Any time in the next six months now seems to be the time frame for those wishing to get out of milking. 

China will cancel their retaliatory tariff on food-grade whey permeate from the United States.  Fluid milk sales ticked up a little in July.  Dean Foods said they are not for sale and their stock price gained 60 percent over two days.  Then it lost half of that the next day, now trading at $1.59 per share, down from $7.50 one year ago.   

Equities on Wall Street gained ground this week, closing in on record highs.  Steers were up $3.20 per cwt.  Weaner pigs gained over $4 per head, and average $26.41.  Weiner dogs are steady at $100 to $500 per head, depending on color, pedigree, disposition and longness.    

Always remember... if you don't like Weiner dogs, there must be something wrong with you.


The author identifies as a farmer near Brooklyn, Iowa

Reader Comments
Comments posted do not express the viewpoint of Dairy Agenda Today or its staff members.

Dairy farmer
September, 16 2019
This is the first explanation I have heard for what happened to milk price last week in any market reports. Its also nice to read farm news that's alittle funny and clever once in a while.
September, 16 2019
The best addition to Dairy Agenda Today in years. Thanks Mr. Lang.