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In light of the announcement by the Chinese to retaliate against the most recent round of U.S. tariffs, the grain markets had some weight to carry through Tuesday's trade. Corn was down 4 cents, soybeans were down cents, and soybean meal fell $2. However, the dairy markets had some pressure of their own to deal with. 

We began Tuesday's trade with the release of global dairy trade event number 220 where cheddar led the charge in its decline lower falling 3.5 percent to $1.59 a pound while from a volume weighted standpoint, whole milk and skim milk powder where the real detractors in the declining index. Whole milk powder fell 1.8% to $1.26 a pound while skim milk powder fell 1.1 percent to 96 cents a pound. Those two products account for more than 75% of the volume in the GDT auction. 

Later that would translate into a lower Grade A nonfat dry milk price were in the CME spot trade. The price fell a quarter sent to 86 and three quarters. barrels also fell in line with the GDT trade dropping a penny and a quarter to $1.40 and three quarters. 

Blocks took the opposite direction rising a penny to $1.61 and a half. Butter followed suit in that regard moving another penny and half higher to $2.27 and a half while whey set another record at 52 and a half cents, up another quarter cent. Class III carried a softer tone all day finishing a nickel lower in its average from now through the end of the year at $16.08.

“Reprinted by permission of Farm Journal media, September 2018”

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