Opening Calls:
| Class III Milk Futures: | Steady to 10 Lower |
| Class IV Milk Futures: | Mixed |
| Butter Futures: | Mixed |
Outside Market Opening Calls:
| Corn Futures: | 10 to 20 Higher |
| Soybean Futures: | 3 to 5 Higher |
| Soybean Meal Futures: | $1 to $2 Higher |
| Wheat Futures: | 4 to 8 Higher |
Milk:
Even though Class III futures were under significant pressure Tuesday with February closing limit down, follow-through selling was minimal overnight. Contracts that traded moved lower, but not with the movement that has been seen over the past month after a limit move. That is due to there being a very limited pool of traders that wanted to trade when contracts were limit down. The other aspect is that the market never should have moved that much with only a slight decline of cheese prices. Movement was magnified due to the fact that there was weakness during the time when most believed cheese prices would continue higher on continued buying for the Food Box program. There is much emphasis being put on how prices moved last year, which has created much volatility. Closer months continue to react the most to underlying cash, leaving later contracts moving but with less volatility.
Cheese:
The slight weakness of cheese Tuesday may not turn the market lower. Buying will continue for the Food Box program, but there will always be time of price movement up or down as business is accomplished. There is plenty of cheese available which may keep prices from moving as high as last year, but there is potential for prices to increase further.
Butter:
Butter has been unaffected by the price movement of cheese and the volatility of milk futures. It continues to exhibit a market of sufficient supply with continued strong production. Demand may not be greater than last year as underlying fundamentals have not changed. Things can change, but it will not take place overnight.
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