Opening Calls:
| Class III Milk Futures: | Mixed |
| Class IV Milk Futures: | Mixed |
| Butter Futures: | Mixed |
Outside Market Opening Calls:
| Corn Futures: | 2 to 3 Lower |
| Soybean Futures: | 7 to 10 Lower |
| Soybean Meal Futures: | $3 to $5 Lower |
| Wheat Futures: | 1 to 3 Lower |
Milk:
Class III futures are holding but are having a difficult time moving higher despite the increase of cheese prices. Traders are bullish, but cautious. The concern is just how far underlying cash prices could move at this time of year. Closer Class III contracts are already $1.00 to $1.50 higher than they were at the beginning of the month, possibly indicating that better demand through food aid has already been factored in. It is unclear whether the money earmarked for food aid on the stimulus bill will just be an increase of what is already being done, or if it will mean additional programs for food boxes similar to what took place this year. Traders are optimistic, but cautious. USDA will release the December Federal Order class prices Wednesday as well as the November Agricultural Prices report.
Cheese:
Cheese prices have been slowly increasing this week despite sellers readily offering product. Trading has been good. Buyers are not being overly aggressive and sellers continue to bring loads to the market. Increasing cheese production means there will be more product that will either need to be consumed or moved to storage. Some of the purchasing taking place is to rebuild aging programs, so it is purchased for the purpose of moving to inventory.
Butter:
Butter closed at the same price as barrels and is at risk of declining further. Output is strong and there are reports supplies are again building. Food service demand does not appear it will change anytime soon. In fact, the new strain of COVID-19 that was discovered in the U.K. has now been discovered in the U.S. This strain is more contagious and could have a significant impact on the rise of cases if it is not contained. The impact of COVID will not be over anytime soon.
