Discover how June FMMO milk prices surged to new highs. What factors drove Class II, III, and IV prices up? Stay informed on dairy market trends and future outlook.
Dairy producers can look forward to healthier June milk checks, driven by the latest Federal Milk Marketing Order (FMMO) milk class prices. As announced on July 3, FMMO Class II, III, and IV prices increased from the previous month, buoyed by higher butterfat and protein values. Notably, the Class III-IV price gap continues to narrow.
Upcoming June 2024 FMMO pooling estimates, uniform prices, and producer price differentials (PPDs) will be announced from July 11 to 14 and summarized on July 15. Stay tuned to Progressive Dairy’s website for the latest updates.
June class prices
Here’s a snapshot of the class prices announced on July 3:
- At $21.60 per hundredweight (cwt), the June Class II milk price is up 10 cents from May and $2.77 higher than June 2023. This is the highest it has been since October 2023.
- The Class III milk price, at $19.87 per cwt, surged another $1.32 from May, reaching an 18-month high and standing $4.96 higher than June 2023.
- At $21.08 per cwt, the June 2024 Class IV milk price increased 58 cents from May and $2.82 more than June 2023. This is also the highest price since October 2023.
Considering potential FMMO pooling impacts, the June 2024 Class IV milk price is $1.21 more than the Class III milk price for the month, down from $1.95 in May. This marks the narrowest spread since September 2023.
Further strengthening prices, the advanced Class I base price was announced at $20.08 per cwt, an increase of $1.62 from May 2024 and $2.07 higher year-over-year. This is the highest Class I base price since February 2023.
Butterfat protein values move higher.
Elevated butterfat and protein values have significantly influenced June’s milk class price calculations. The value of butterfat climbed about 8 cents from May, reaching around $3.54 per pound. Milk protein saw an even more notable increase, rising nearly 32 cents to $2.05 per pound, the highest value since September 2023.
The value of nonfat solids increased by approximately 3.5 cents to 99.9 cents per pound, while the value of other solids increased by about 1.5 cents to 23.3 cents per pound.
Looking ahead
Given FMMO advanced prices and current futures prices, the outlook for July milk prices is mixed but generally looking stronger.
The July 2024 advanced Class I base price has already been announced at $21.11 per cwt, a $1.03 increase from June 2024 and $3.79 higher than a year ago. This makes it the highest since January 2023.
July Class II, III, and IV milk prices will be released on July 31. According to trading on July 2, the Chicago Mercantile Exchange (CME) Class III milk futures price closed at $19.42 per cwt for July, showing a 45-cent drop from the June price. Meanwhile, the Class IV milk futures price closed at $21.41 per cwt for July, reflecting a 33-cent rise from June. Should these futures prices persist, the July Class III-IV milk price gap will widen to $1.99 per cwt, incentivizing some Class IV deploying.
