Milk futures reacted negatively to the slightly bearish July Milk Production report and then positively to the bullish July Cold Storage report with contracts swinging violently in response.
The milk production report showed milk output showing the lowest year-over-year decline so far this year. That was less than expected as it was anticipated the hot weather experienced during the month would have had a greater impact. Milk production has been lower than the previous year for 13 consecutive months. Another surprise was that cow numbers increased by 5,000 head from June. Both of these areas triggered a bearish reaction in the market. Even though cow numbers increased from the previous month, cow numbers were 21,000 head less than in March and 43,000 head less than a year ago.
September 3, 2024
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