OPENING CALLS:
| Class III Milk Futures: | 2 to 5 Lower |
| Class IV Milk Futures: | 4 to 8 higher |
| Butter Futures: | Mixed |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | Steady to 2 Higher |
| Soybean Futures: | 4 to 7 Higher |
| Soybean Meal Futures: | $2 to $3 Higher |
| Wheat Futures: | 5 to 8 Higher |
MILK:
Milk futures overnight reflected the movement of underlying cash Monday. This should carry through Tuesday morning until direction is seen from underlying cash. It was unusual to see Class IV futures trade overnight, but there is a greater element of support developing for the complex. Nonfat dry milk is the main driver under Class IV as butter remains in a sideways pattern. It is interesting to seem Class IV futures above Class III in numerous contracts in 2022. It has been quite some time since we have seen that. This certainly improves milk pricing and should eliminate negative Producer Price Differentials.
CHEESE:
The inability of cheese price to move above price resistance is a concern, leaving one questioning whether prices will trend higher through the end of the year. Increased domestic and international demand has not been able to tighten supply as plants continue to receive sufficient milk for manufacturing needs. This may continue to leave prices rangebound.
BUTTER:
Price continues to chop around, but at least is holding at a higher level. Retail demand is improving seasonally while demand from the food service industry has been steady. The potential for price to reach $2.00 by the end of the year is dimming as inventory is plentiful to supplement current production to meet demand.
