OPENING CALLS:
| Class III Milk Futures: | 10 to 15 Lower |
| Class IV Milk Futures: | Steady to 5 Lower |
| Butter Futures: | Mixed |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 2 to 4 Lower |
| Soybean Futures: | 1 to 3 Lower |
| Soybean Meal Futures: | $1 to $2 Higher |
| Wheat Futures: | 10 to 12 Lower |
MILK:
Class III futures came under pressure Friday as cheese prices declined. Overnight trade indicates selling pressure may continue again Monday. Weather has been good for cow comfort and milk production. Even though cow numbers and production per cow has declined over the past three months, there remains sufficient milk to satisfy both bottling and manufacturing demand. USDA will release the November Milk Production report Monday afternoon. The numbers on the report will indicate price direction for a period of time. I estimate milk production to be 0.8% lower than a year ago with cow numbers down 5,000 head from October. Australia signed a Free Trade Agreement with the U.K. The transition to duty-free dairy trade will be accomplished over the period of the next five years.
CHEESE:
The weakness of the past two days leaves traders wondering whether the top is in for the time being. Holiday orders are filled with orders for after the holidays already placed and, in some cases, filled. Now with the surge of COVID again, it is possible further disruptions in production and delivery may again increase. Not only in the U.S. but also overseas with shipping not getting any better.
BUTTER:
Butter may be in a stronger position than cheese as both domestic and international demand has been stellar. Production has been lighter due to a tighter cream supply over the past few months. Inventory has been declining.
