Opening Calls:
| Class III Milk Futures: | Steady to 5 Lower |
| Class IV Milk Futures: | Mixed |
| Butter Futures: | Mixed |
Outside Market Opening Calls:
| Corn Futures: | Steady to 3 Higher |
| Soybean Futures: | 10 to 14 Higher |
| Soybean Meal Futures: | $2 to $3 Higher |
| Wheat Futures: | Mixed |
Milk:
The anticipation of increasing demand through government purchases as a result of another stimulus bill will need to be balanced with fundamentals of increasing milk production and supply. Cold weather will have an impact on milk output for the next two weeks, but this is not likely to affect overall milk production growth over the next few months. Just as farms have made large strides to keep cows cool in hot weather, they are able to manage cold weather better as well. Milk futures may be choppy prior to spot trading as there is uncertainty whether cheese prices will continue to improve. The current price movement is similar to what took place just before Christmas as a reaction to the stimulus bill at that time. The question is whether the price pattern will be similar, resulting in the resumption of a lower trend if not supported by continued buying. USDA will release the World Agricultural Supply and Demand report Tuesday. Grain ending stocks and expected to be reduced due to strong demand. Milk production might be raised while milk and product prices may show little change.
Cheese:
Cheese prices may remain supported Tuesday if buyers want to purchase supply ahead of time just in case prices continue to rise. The strength at the end of last week failed to pull buyers in aggressively Monday. This may reduce the emotion of the leap-frog effect stemming from being left out of the buying frenzy. There is sufficient supply available in the country satisfying current demand.
Butter:
Price is expected to hold in a sideways range for a period of time. Price may not head for the lows as expected earlier last week for the time being. Churning remains very active with inventory continuing to increase. This may limit upside potential even if demand improves.
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