Dairy producers’ July milk checks should be similar to those received in June, based on a preview of Federal Milk Marketing Order (FMMO) milk class prices. Announced on July 31, FMMO Class II and IV prices were up slightly compared to a month earlier, offset by a small decline in the Class III milk price. The wider Class III-IV milk price spread again adds incentives for Class IV depooling.
July 2024 FMMO pooling estimates, uniform prices and producer price differentials (PPDs) will be released on Aug. 11-14 and summarized on Aug. 15. Watch Progressive Dairy’s website for an update.
July class prices
Class prices announced on July 31 were:
- At $21.82 per hundredweight (cwt), the July Class II milk price is up 22 cents from June and $2.70 more than July 2023. It’s the highest since October 2023.
- After hitting an 18-month high in June, the Class III milk price dipped 8 cents to $19.79 per cwt in July but is still $6.02 more than July 2023.
- At $21.31 per cwt, the July 2024 Class IV milk price is up 23 cents from June and is $3.05 more than July 2023. It’s also the highest since October 2023.
Potentially affecting FMMO pooling, the July 2024 Class IV milk price is $1.52 more than the month’s Class III milk price, up from $1.21 in June.
Supporting blend price strength – especially in high Class I milk utilization marketing areas – the July advanced Class I base price was previously announced at $21.11 per cwt, up $1.03 from June 2024 and $3.79 more than a year ago. It’s the highest Class I base price since January 2023.
Butterfat, protein values also mixed
Contributing to the July milk class price calculations, value changes for butterfat and protein were also mixed.
The value of butterfat increased about 2.8 cents from June, moving above $3.57 per pound. The value of milk protein fell more than a dime to $1.95 per pound.
The value of nonfat solids was up about 1.5 cent at $1.01 per pound, while the value of other solids rose about 2.5 cents to 25.7 cents per pound.
Looking ahead
Based on FMMO advanced prices and current futures prices, the outlooks for August regional uniform milk prices improves slightly.
Already announced, the August 2024 advanced Class I base price is $21.32 per cwt, up 21 cents from July 2024 and $4.70 more than a year ago. It’s the highest Class I base price since January 2023.
August Class II, III and IV milk prices will be announced Sept. 5. As of trading on July 30, the Chicago Mercantile Exchange (CME) Class III milk futures price closed at $19.83 per cwt for August, up just 4 cents from the July price. The Class IV milk futures price closed at $21.43 per cwt for August, up 12 cents from July. If Class III-IV futures prices hold, the August Class III-IV milk price gap will increase to $1.60 per cwt, continuing to provide some incentives for Class IV depooling.
