Opening Calls:
| Class III Milk Futures: | 10 to 40 Higher |
| Class IV Milk Futures: | 5 to 10 Higher |
| Butter Futures: | 1 to 2 Higher |
Outside Market Opening Calls:
| Corn Futures: | Mixed |
| Soybean Futures: | 6 to 8 Lower |
| Soybean Meal Futures: | Mixed |
| Wheat Futures: | 8 to 16 Higher |
Milk:
Late strength came into milk futures late Thursday after market prices had been settled for the day. This pushed February and March limit-up for a brief period. According to overnight trade and current market bids, the market is trading in February where it finished trading near the close of the trading Thursday. March appears to likely trade where it also finished trading Thursday at the close of electronic trading at 4 p.m. CT. Futures did not close at those levels due to the CME market to market shortly after 2 p.m. It has always been that way since electronic trading. It is the same for other markets such as energies, metals, indexes, currencies, etc. There might be some confusion over the catalyst that caused the late strength Thursday. One report indicated it was the pre-solicitation of purchases of $40 million of cheese and processed cheese and $40 million of butter under section 32, which is government purchases for food distribution. These are regular purchases for food programs and not for the Food Box program. The issue is that this notice was released on Wednesday without the market reacting. It seems it might have been influenced in part by the potential for increased government buying even under regular food program purchases as well as the possibility of more demand from government purchases in the proposed new stimulus plan released by President-elect Biden last night. All of this will need to be supported by underlying cash. Hang on to your hats!
Cheese:
Cheese futures look like they will be trading higher also based on current bids in the market with the January contract the exception. January showed 20 trades at a slightly lower price overnight. Spot cheese prices may not move much based on the action so far this week. Whether buyers may turn more aggressive Friday as they take advantage of lower prices and purchase supply is unclear. Dairy markets will be closed Monday.
Butter:
Butter price might follow through to the upside Friday following the bounce Thursday as is generally the pattern when prices bounces. The increase is likely to be limited. The market is dealing with good retail demand but continued slow food service demand. This will be the pattern for much of the year.
