OPENING CALLS:
| Class III Milk Futures: | Mixed |
| Class IV Milk Futures: | Steady to 5 Higher |
| Butter Futures: | Mixed |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 4 to 7 Higher |
| Soybean Futures: | 4 to 8 Higher |
| Soybean Meal Futures: | $2 to $4 Higher |
| Wheat Futures: | 1 to 3 Higher |
MILK:
Class III milk futures held fairly well Wednesday in the face of further deterioration of spot cheese prices. There is a possibility some support may be found soon, and traders did not want to hold too many sold futures positions. Milk production remains strong with the next event that could impact production being hot weather. It does not appear higher grain prices will slow milk production down in the near term. USDA will release the April Milk Production report Thursday. The report is expected to show higher milk production and increased cow numbers. I estimate milk production to be 2.0% above a year ago and cow numbers to be 2,000 head more than March.
CHEESE:
There is no indication cheese prices are finished moving lower. Barrels tried to increase Wednesday, but just could not maintain the slightly higher price seen early in spot trading. There are plentiful supplies of cheese available to meet current demand. Some of the purchasing on the spot market is for aging programs and not immediate demand.
BUTTER:
Price continues to remain supported and about 25 cents above cheese. This continues to improve Class IV prices. It is interesting that butter is as strong as it is due to the fact that inventory is high. However, buyers feel comfortable purchasing supply at current levels to fill strong demand from the food service industry.
