OPENING CALLS:
| Class III Milk Futures: | Mixed |
| Class IV Milk Futures: | Mixed |
| Butter Futures: | Mixed |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 1 to 3 Higher |
| Soybean Futures: | 3 to 5 Lower |
| Soybean Meal Futures: | Mixed |
| Wheat Futures: | 4 to 6 Lower |
MILK:
Milk futures might show a further price retracement as the weakness of block cheese and butter on Thursday might result in a price correction to more closely align with underlying cash. After all, milk supply is sufficient for demand with no reports of shortages. Supplies of spot milk are not as plentiful as they had been during the end of the year, but there remains some discounts. Milk movement will be hindered in those areas where the large winter storm is moving across. This will be temporary and will not have a lasting impact on milk supply. Markets will be close on Monday due to Martin Luther King Jr. day. However, that is not expected to have any impact on trading activity Friday.
CHEESE:
The block/barrel spread has moved quickly together with a difference of 7 cents. The general consensus has been that a good spread between blocks and barrels was 3 to 4 cents. This is the level at which the cheese industry was comfortable and balanced. However, that has changed over the years with each category running on its own fundamentals which has kept the spread very wide or even inverted for long periods of time. The spread moving closer together does not really provide any indication of continued price direction.
BUTTER:
Butter has had two days of losses, which could bring buyers back into the market again to take advantage of the lower prices. That is, unless buyers have sufficient supply on hand for the time being and may remain out of the market. Butter production is slowly increasing as cream is becoming more available, but it will take some time to rebuild inventory.
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