Milk futures have extended their gains from the April 14th low, however overall dairy activity has not mirrored the action. Milk futures for June delivery was up .04 cents today trading at $14.02 (per cwt) at the Chicago Mercantile Exchange.
Along with milk futures, whole milk powder prices have been up 7.5% to their highest levels in three months, while skimmed milk powder has only rose 0.3% – cheddar cheese actually falling by nearly 4%. Production in New Zealand – the world’s top dairy exporter – remains robust despite most farmers there operating “in the red.”
Danielle Bourbeau, a commodity broker for Capital Trading Group in Chicago, shared her fundamental view of the milk futures market by stating, “Milk futures, however accelerating solely from overall dairy futures, shouldn’t be looked into much.” Bourbeau adds, “Global dairy markets may remain under heavy production, but we’re understanding overall demand is rather sluggish.”
The trend for milk futures is “up” from the overall picture March lows, but barely. I expect milk futures to test its March lows or continue with the overall downtrend should the $13.50 support area become compromised.
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