OPENING CALLS:
| Class III Milk Futures: | Mixed |
| Class IV Milk Futures: | 4 to 8 Higher |
| Butter Futures: | Mixed |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | Mixed |
| Soybean Futures: | 3 to 5 Higher |
| Soybean Meal Futures: | $1 to $2 Higher |
| Wheat Futures: | 4 to 7 Lower |
MILK:
Traders are less optimistic over Class III milk prices through the end of the year but are holding prices steady for 2022. Milk is trending lower due to heavy culling and lower production per cow, but even with reduced production, cheese inventory has grown. However, the trade is looking ahead to next year and the potential of tighter milk supply. Current milk futures indicate a somewhat flat year for 2022 with limited price movement. However, we know that will not be the case as there are many factors that will impact price movement. USDA will release the September Agricultural Prices report Friday afternoon, which will provide the average prices used in the calculation of income over feed. There will again be a significant payment under the Dairy Margin Coverage program. Schreiber Foods had a cyberattack this week with hackers demanding $2.5 million to unlock their computer systems. This put many dairy companies in confusion as adjustment needed to be made in distribution and delivery.
CHEESE:
Activity during spot trading Thursday suggests further weakness may unfold Friday. Cheese prices may not be low enough to cause buyers to step back up to the plate. However, increasing demand may require them to purchase earlier rather than later.
BUTTER:
Price is carrying a nice premium to cheese with a concern of whether it can be maintained. Historically, butter would lead the direction of cheese, but that may not be the case currently as supplies are different for each category. Butter may achieve the level of $2.00 and the high of early June in the near term.
