OPENING CALLS:
| Class III Milk Futures: | Steady 5 Lower |
| Class IV Milk Futures: | 5 to 10 Higher |
| Butter Futures: | 1 to 2 Higher |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 10 to 15 Higher |
| Soybean Futures: | 12 to 20 Higher |
| Soybean Meal Futures: | $5 to $8 Higher |
| Wheat Futures: | 12 to 20 Higher |
MILK:
Gains were trimmed a bit Thursday due to the divergence of cheese prices, but futures continue to hold well. There may be limited trade prior to spot trade due to the action Thursday. Weather has been good for milk production, keeping output near the peak of spring flush in many areas of the country. The large decline of grain prices Thursday, although welcomed, may be short-lived as the market turns its attention back to demand and weather. There is no doubt there will be quite a bit of volatility throughout the summer. Whether Class III milk prices will be able to remain near current levels or higher is not a certainty. Cow numbers are expected to remain high as the intent for the near-term is to keep barns full.
CHEESE:
The weakness of block cheese with a significant increase in trading activity indicates supply and demand are balanced. When more cheese is offered on the spot market, buyers are ready and willing to purchase it. If buyers become more aggressive, sellers will offer more to the market. This has kept block price within a tight sideways price range since mid-March.
BUTTER:
Price has been able to move nicely above cheese due to strong demand from the food service industry. However, stronger demand from that industry has reduced some demand from the retail. Price could move to $2.00 as the year progresses. Butter futures show a price of $1.97 for November and December, indicating limited price potential from the current level. A lot can change in a short period of time.
