Dairy producers’ September milk checks were the strongest in almost two years. They’ll start to weaken during the fourth quarter of 2024 based on a preview of Federal Milk Marketing Order (FMMO) milk class prices.
Announced on Oct. 30, FMMO Class II, III and IV milk class prices were down compared to a month earlier. October 2024 FMMO pooling estimates, uniform prices and producer price differentials (PPDs) will be released on Nov. 11-14 and summarized on Nov. 15. Watch Progressive Dairy’s website for an update.
October class prices
Class prices announced on Oct. 30 were:
- At $21.01 per hundredweight (cwt), the October Class II milk price is down $1.39 from September and 94 cents less than October 2023. It’s the lowest since February 2023.
- The October Class III milk price fell 49 cents from September to $22.85 per cwt. That is still up $6.01 from October 2023 and the second highest since June 2022.
- At $20.90 per cwt, the October 2024 Class IV milk price is down $1.39 from September and is 59 cents less than October 2023. It’s the lowest since May 2024.
Potentially affecting FMMO pooling, the October 2024 Class III milk price is $1.95 more than the month’s Class IV milk price, providing incentives for depooling Class III milk.
Offsetting lower Class II, III and IV milk prices, FMMO blend prices will be supported by a higher advanced Class I base price, previously announced at $23.17 per cwt, up $1.57 from September 2024 and $3.70 more than October 2023. Producers in FMMOs with higher Class I milk utilization percentages should see the most price benefits.
Butterfat value falls, protein value higher
Contributing to the October milk class price calculations, value changes for butterfat and protein were mixed from a month earlier.
- The value of butterfat fell almost 53 cents from September to under $3.09 per pound. It’s the lowest since January.
- Meanwhile, the value of milk protein rose almost 40 cents to more than $3.32 per pound, the highest since June 2022.
- The value of nonfat solids was up more than 5 cents at $1.16 per pound, while the value of other solids rose about 3 cents, to 37 cents per pound.
Looking ahead
Based on FMMO advanced prices and current futures prices, the outlooks for November regional uniform milk prices are weaker.
- Already announced, the November 2024 advanced Class I base price is $22.53 per cwt, down 64 cents from October 2024 but still $2.78 more than November 2023.
- November Class II, III and IV milk prices will be announced Dec. 4. As of trading on Oct. 29, the Chicago Mercantile Exchange (CME) Class III milk futures price closed at $20.22 per cwt for November, down $2.63 from the October price. The November Class IV milk futures price closed at $20.91 per cwt, up just a penny from October.
- If Class III-IV futures prices hold, the November Class III-IV milk price gap will shrink to 69 cents, offering a slight incentive for Class IV depooling.
