OPENING CALLS:
| Class III Milk Futures: | Mixed |
| Class IV Milk Futures: | 4 to 10 Higher |
| Butter Futures: | Steady to 1 Higher |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 2 to 4 Lower |
| Soybean Futures: | 7 to 12 Lower |
| Soybean Meal Futures: | Mixed |
| Wheat Futures: | 8 to 12 Lower |
MILK:
Closer Class III milk futures have fallen about a $1.00 over the past week. Once the corn market topped, it impacted the market negatively. It is interesting to see how strongly correlated the markets were even though these markets do not move in tandem on that quickly of a basis. This has truly been driven by perception rather than reality. The change of feed prices in relation to milk prices generally has a period of lag time. Indications were that high grain price were not going to impact milk prices for a period of time due to the strong interest in purchasing cows and replacement heifers at auctions. Cow numbers are expected to remain high rather than decline as many had expected. Class IV milk is showing strength as butter and powder prices remain rather strong. This is moving the Class III and Class IV prices closer together.
CHEESE:
Business is increasing in the spot market, but unfortunately, buyers are waiting for lower prices. Sellers have been aggressively moving product at lower prices in order to limit inventory build. As long as cheese continues to be offered aggressively on the spot market, buyers will hold back waiting to see how low they will go.
BUTTER:
Butter has good support under price. Buyers and sellers do business as they need to, which is keeping the market balanced and price choppy. Demand has been good both domestically and internationally. This is not expected to change much for a period of time. The inventory report on Monday will indicate the level of demand in April.
