Al6-Lancaster Farming, Saturday, May 5,2001
GRAIN, CATTLE. HOG,
&MILKBFP
FUTURES MARKETS
Markets Courtesy of Chicago Board and Mercantile Exchange
Closing Bids: Thursday, May 3,2001
Corn
Month opening High L*oW/iP|iP» Closing ; i Sfettle SNetChg
OlMay 202 202 3/4 200 1/4 200 1/4 200 3/4 1200 1/2 -2
OUul ,209 3/4 210 1/2 207 l/2 f 208 207 1/2 207 3/4
OlSep 218 218 1/2 215 3/4 215 3/4 216 { 216
01NOV
223 3/4 n
OlDec 229 1/2 230 226 3/4 226 3/4 227
02Jan i
02Mar
240 240 1/4 237 1/4
02May 246 3/4 247 244 1/2
02Jul 253 1/2 253 1/2 250 3/4
02Sep
02Dec 260 1/2 260 3/4 258
03Dec
Month Opening High Low >
Soybeans
Month Opening High Low Closing
OlMay 443 446 440 442 1/2
OUul 441 1/2 443 1/4 436 1/2 437 1/4
440 440 1/2 433 1/2 433 1/2
OlAug
OlSep 433 1/2 434 426 1/2 427 426 1/2
OINov 435 435 1/2 428 1/2 428 1/2 429
02Jan 445 445 440 440
02Mar 451 452 449 449
02May 456 456 453 451 b 453 a 453
02Jul 467 467 461 1/2 461 1/2 461 1/2
475 472 1/2 473 472 1/2 472 3/4
Month Opening High Low Closing Settle
02Nov
475
Soybean Meal
Month Opening High Low Closing Settle Net Chg
OlMay 158.0 158.9 157.0 158.8 158.7 158.7 f■ I
OUul 156.1 156.5 154.2 155.5 155.8 155.6
OlAug 153.4 153.8 151.5 152.3
OlSep 150.4 150.4 148.3 149.0
OlOct 148.5 148.5 146.8 146.8 147.0 146.9
OlDec 149.0 149.2 147.0 147.5
02Jan 148.3 149.2 148.0 148.0
02Mar 149.4 150.8 149.1 149.0 b 149.1 a 149.1
02May 149.0 149.0 148.0 148.0
02Jul 149.0 149.0 148.0 148.0
Month Opening High Low
Weekly Dairy Market Outlook
Ken Bailey
Penn State
April 27,2001
Milk Price
Outlook Uncertain
• Cash market stronger.
• Futures markets volatile.
• GDP for first quarter up 2
percent.
I am stunned to see the recent
increase in butter and cheese
prices, and hence the Class 111
and IV futures prices. Like most
analysts, this caught many by
surprise. Let’s review the mar
kets.
The cash market for cheese
and butter experienced a lot of
volatility this week. At the Chi
cago Mercantile Exchange,
barrel prices rose from $1.4325
per pound on Monday, April 23,
to $1.52 per pound by Friday,
April 27. Likewise, block cheese
prices rose from $1.45 per pound
on Monday to $1.54 by Friday.
USDA reports these prices are
the highest cash cheese prices
since the fall of 1999. Many
buyers are building inventories
in anticipation of tighter milk
supplies later in the year.
The butter market at the Chi
cago. . ¥PfC.aptik Jignge.
|230 1/4 n
237 1/4 237 1/2
244 1/2
250 3/4
256 n
258 258 1/4
264 3/4 n
Closing
Closing
reached $2 per pound this week.
Grade AA butter rose from
$1.95 per pound Monday,
peaked at $2.0125 per pound
Wednesday, then fell to $1.9275
by Friday. USD A reports that
while butter demand is only
“fair at best,” people are hold
ing butter stocks in anticipation
of a short milk supply.
The futures markets at the
Chicag* Mercantile Exchange
reflected the tightness in the
cash markets. As of April 27,
Class 111 settlement prices were
$12.02 for April, $13.54 for May,
$13.94 for June, $13.97 for July,
$13.95 for August, $14.03 for
September, and $13.56 for Octo
ber.
Class IV prices at the Chicago
Mercantile Exchange as of April
27 were $14.45 for April, $15.10
for May-July, $15.40 for August
and September, and $14.95 for
October. The peak Class IV
price was down from $l6 earlier
in the week.
So, which way are prices
headed in the next few months?
Let’s review the options.
One school of thought is “you
ain’t seen nothing yet.” These
, Xojks. think the milk supply will
1223 3/4
227
;230 1/4
,237 1/2
244 1/2
251
251
256
258 1/4
264 3/4
Settle Net Chg
Settle | Net Chg
442 3/4| +l2
437 3/4
443
438
433 3/4
434
426 3/4
428 3/4
440
449
152.3
149.0
147.5
-11
148.0
-10
148.0
-10
148.0
Settle Net Chg
be crippled through the fall
months. Buyers of cheese and
butter fall into this camp and are
buying now in order to avoid
paying much more later in the
year. Many remember when
butter prices hit $2.81 per pound
in September, 1998. These folks
are bolstered in part by the latest
GDP report that indicates that
the real Gross Domestic Product
for the first quarter of this year
grew at an astonishing 2 per
cent! Many had expected a weak
1 percent growth rate. While the
economy may be slowing, we are
nowhere near a recession. That
means continued moderate to
strong growth in demand for
dairy products.
The other school of thought is,
“if it’s too good to be true, it’s
probably not.” This group
thinks that the reduction in the
milk supply is only temporary
and that cows will recover.
Given the large number of cows
out west, the milk supply could
respond very quickly. I’m par
tial to this group. I think the re
duction in production per cow is
due in part to poor forage and a
hard winter, but also because of
reduced use of inputs.
Lean Hogs
Daily Prices As of Thursday, 3 May
Date
05/03/01
05/03/01
05/03/01
05/03/01
05/03/01
05/03/01
05/03/01
Composite VolumeOpenjnt
05/02/01 8696 40661
Live Cattle
Daily Prices As of
Date
05/03/01
05/03/01
05/03/01
05/03/01
05/03/01
05/03/01
05/03/01
-12
-24
Composite Volume Open_lnt
05/02/01 11485 113245
-42
-46
Pork Bellies
Daily Prices As of :- Thursday, 3 May
-56
-50
-50
Date
-50
05/03/01
05/03/01
05/03/01
05/03/01
05/03/01
05/03/01
-54
-52
Net Chg
Composite VolumeOpenjnt
05/02/01 1206 3145
Oats
Month Opening High Low
OlMay 109 1/2 110 108 1/2
OUul 112 3/4 114 112 113 113 1/4 113
OlSep 113 3/4 113 3/4 112 1/4 112 1/2 a 112 1/2
OlDec 118 3/4 119 118 1/4 118 3/4 118 3/4
124 a 124 -14
Closing- '-Settle Net Chg
02Mar
Month {Opening
Open High Low Last Chge Prev ‘ Pr f v '
Volume Open_lnt
5070 17756
2213 5831
1017 6214
266 5888
125 3936
4 876
1 160
Jim 01
Jul 01
Aug 01
Oct 01
Dec 01
Feb 02
Apr 02
6700 6740 6665 6707
6540 6590 6515 6565
6250 6300 6225 6277
5390 5435 5375 5425
5122 5180 5122 5160
5250 5255 5200 5237
5250 5270 5175 5270
- Thursday, 3 May
Open High Low Last Chge v PrCV ‘ n P *? V ’
6 Volume Openjnt
6840 45919
2839 27354
1294 23559
369 11502
129 3625
11 1217
2 2
Jun 01
Aug 01
Oct 01
Dec 01
Feb 02
Apr 02
Jun 02
7147 7170 7070 7085
7180 7202 7120 7130
7340 7360 7290 7292
7420 7427 7380 7382
7475 7480 7455 7460
7620 7620 7605 7607
0 7280 7280 7280
Open High Low Last Chge Prev ‘ Pr f V-
Volume Open_lnt
276 500
851 2234
73 371
6 33
0 4
0 3
May 01
8330 8350 8207 8245 -85
8430 8475 8280 8322 -88
8235 8260 8100 8120 -90
7200 7200 7150 7150 -60
0 7210 7210 7210 unch
0 7400 7400 7400 -100
Jul 01
Aug 01
Feb 02
Mar 02
May 02
High
LOW
When farmers are cash
starved, they have to make cuts
somewhere. This means making
undesirable decisions (i.e. using
less feed, selling cows, etc). The
milk supply situation could turn
around very quickly with spring
forages, high milk prices, and
cheap grains. Also, we could see
a limit on how high butter prices
get because of imports.
Anytime butter gets above
$1.85, it pays to import butter
outside the quota. A final nega
tive for the Class IV price is an
expected reduction in the sup
port price for nonfat dry milk.
USD A will not continue to buy
47 percent of all the powder pro
duced in the U.S. They are likely
waiting for market prices to re
cover before announcing a re-
Average Farm Feed
Costs for Handy
Reference
To help farmers across the state to
have handy reference of commodity
input costs m their feeding operations
for DHIA record sheets or to develop
livestock feed cost data, here’s last
week’s average costs of various ingred
ients as compiled from regional reports
across the state of Pennsylvania
Remember, these are averages, so you
Closing Settle Net Chg
+ 2
110
duction. Guess what, market
prices have recovered! That
could result in a slight drop in
the price of nonfat dry milk, and
hence the Class IV price.
USDA reported this week
that international prices for
skim milk powder were $0.93
per pound in Western and East
ern Europe, and $0.97 in
Oceania. Thus a reduction in the
support price of nonfat dry milk
at this time would not result in
much of a drop in domestic
nonfat dry milk prices, but it
would reduce surplus stocks.
Class IV prices would drop
more substantially when inter
national prices weaken.
Which school of thought do
you belong to?
will need to adjust your figures up or
down according to your location and the
quality of your crop.
Corn, No.2y 2.20 bu , 3.93 cwt.
Wheat, N 0.2 2 32 bu , 3 87 cwt
Barley, N 0.3 1.54 bu., 3.30 cwt.
Oats, N 0.2 1.42 bu , 4.44 cwt.
Soybeans, No I—4 02 bu., 671 cwt
Ear Corn 59.38 ton, 2.97 cwt.
Alfalfa Hay —102.50 ton, 5.13 cwt
Mixed Hay 95.00 ton, 4.75 cwt.
Timothy Hay 88.75 ton, 4.44 cwt
110
+ 4