Opening Calls:
| Class III Milk Futures: | Mixed |
| Class IV Milk Futures: | Steady to 8 Lower |
| Butter Futures: | 1 to 2 Lower |
Outside Market Opening Calls:
| Corn Futures: | Mixed |
| Soybean Futures: | 2 to 4 Higher |
| Soybean Meal Futures: | $1 to $2 Higher |
| Wheat Futures: | 8 to 12 Higher |
Milk:
Support will remain under Class III futures as long as cheese prices hold or move higher. The February contract moved above $20.00 Monday but backed down substantially after reaching $20.08. Current underlying cash could not bear that level at this point. Higher cheese prices could move milk futures higher again as the anticipation grows of continued strength due to greater demand. Futures will remain inverted as long as government buying continues for the Food Box program. Front-month January will be priced for the most part by the end of this week and will move little through the rest of the month. USDA will release the World Agricultural Supply and Demand report Tuesday, which will report grain production and ending stocks. It will also provide estimates for milk production, milk prices and product prices for the year.
Cheese:
The block/barrel spread continues to widen as block buyers are more aggressive. There is trading in barrels as buyers and sellers accomplish business at the current price. Sellers are not holding back but would rather move supply. Sellers of blocks remain willing to sell, but at higher prices. Buyers continue to aggressively purchase what is available at whatever price. Blocks at $2.00 is better than $3.00 and that will keep buyers aggressive.
Butter:
Price is moving in the opposite direction of cheese. The same optimism shared by cheese and not being shared by butter. Large supply, slower exports and strong output leaves manufacturers wanting to move product at the best price they can. Sellers are not holding back in anticipation of higher prices down the road. Further weakness Tuesday will resume the downtrend of price.
