Market Reports

After the enthusiasm ignited by last week’s USDA announcement, most commodities struggled to keep the momentum going. The butter and cheese markets both finished the week on a softer note while dry products, especially whey, fared somewhat better.

Monday’s announcement that the USDA is extending its Farmers to Families Food Box Program spurred dairy commodity prices upward, with all products seeing gains during Tuesday’s spot session.

There is no word yet on when USDA will begin spending its allocations, which makes it difficult to assess the repercussions for the dairy markets. The dairy funding could make a big splash if it is spent in a short time, or slowly ripple through the markets if spent steadily throughout the next year.

A setback is possible, but it’s impossible to predict the timing or magnitude of a retreat from the highs. Seasoned traders warn “Don’t fight the trend.”

February through December contracts posted life-of-contract highs, a sign of health and good cheer.

There is plenty of fodder for both the bulls and the bears, creating a rather schizophrenic trading market. We’re in a full-blown weather market, and the futures will be as fickle as the forecast.