OPENING CALLS:
| Class III Milk Futures: | Mixed |
| Class IV Milk Futures: | Mixed |
| Butter Futures: | Mixed |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | Mixed |
| Soybean Futures: | 2 to 5 Higher |
| Soybean Meal Futures: | $1 to $2 Higher |
| Wheat Futures: | Steady to 3 Lower |
MILK:
Milk futures have had two weeks of very strong price increases. Buyers have been aggressive in the underlying cash market, which has provided support to milk prices. There is no shortage of milk, but the perception is that milk supply might tighten next year if cows continue to be culled heavily. That is the current perception of the market. It is doubtful underlying cash prices will continue to increase at the pace they have, but price weakness might be limited. The cost of goods and services are expected to increase again in the new year, which will continue to hamper expansions or the addition of cows into existing facilities. Markets will be open for a full day Friday.
CHEESE:
Maybe block cheese can reach $2.00 by the end of the year. Price is now at the highest level it has been since Nov. 12, 2020. There has been volatility this year but certainly not as much as 2020. Buyers of cheese have been aggressively purchasing cheese ahead of time to position themselves for first quarter demand and to rebuild inventory as prices move higher. Cheese inventory continues to remain higher than a year ago.
BUTTER:
Price has been straight up the past two weeks with little indication that it will run out of steam. There is a frenzy that has dominated the market as buyers continue to purchase at whatever price they can get the product. Manufacturing plants are holding back supply to make sure they have some inventory to meet later demand. This has limited the amount of butter that is available in the country and that is coming to the daily spot market.
