Opening Calls:
| Class III Milk Futures: | Mixed |
| Class IV Milk Futures: | Steady to 5 Higher |
| Butter Futures: | Steady to 1 Higher |
Outside Market Opening Calls:
| Corn Futures: | 5 to 8 Lower |
| Soybean Futures: | 7 to 10 Lower |
| Soybean Meal Futures: | $4 to $6 Lower |
| Wheat Futures: | 5 to 10 Lower |
Milk:
Most Class III future contracts closed lower over the past two days, unable to follow block cheese higher Monday, and then following block cheese lower yesterday. Now traders are uncertain over price direction. Some traders want the market to move higher and expect the market to move higher, but underlying cash is not supporting that perception. Demand will need to improve, bringing buyers to the spot market more aggressively in order to support that anticipation. There is concern futures prices could fall back to their previous lows if cheese prices remain steady or show further weakness. The World Agricultural Supply and Demand report Tuesday showed the potential for continued growth in milk production and lower milk prices this year than last year.
Cheese:
Barrels held the gain from Friday for the past two days. The negative aspect of this is that the market was unable to follow through to the upside as of yet. The weakness of blocks may indicate it could be difficult to support higher cash in the current market environment. Cheese production is strong with many plants running at capacity.
Butter:
Price has been able to hold near the higher level after the increase last week. This price bounce is lasting longer than it usually has, which could indicate there is a little better balance between production and demand. We know inventory is high and will be an anchor on price potential, but if increasing demand is reducing the amount moving to inventory, that will provide some support.
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