OPENING CALLS:
| Class III Milk Futures: | Mixed |
| Class IV Milk Futures: | Mixed |
| Butter Futures: | Steady to 1 Higher |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 1 to 3 Lower |
| Soybean Futures: | 6 to 9 Higher |
| Soybean Meal Futures: | $3 to $3 Higher |
| Wheat Futures: | 2 to 4 Lower |
MILK:
Traders anticipated further weakness of underlying cash Thursday, but buyers stepped back into the spot market. This increased the optimism of traders turning Class III milk futures higher. The opposite was true for Class IV futures, as the substantial decline of butter put pressure on the market. Class IV continue to hold significantly higher prices than Class III. This is expected to continue as the year progresses due to inventory and demand. Milk production remains steady to slowly improving. Weather this winter been good in general. There have been some significant storms and there is one taking place now that will impact a large area of the country. These have impacted the movement of milk and products, but there have been no reports of any significant impact to the market. The January Milk Production report will be released on Wednesday and will be watched closely for any signs of increasing cow numbers or increase production. Dairy markets will be closed on Monday due to the observance of President's Day.
CHEESE:
Cheese buyers took advantage of the minor break of prices on Wednesday as they continue to purchase ahead to fill orders and to increase ownership of supply. USDA will release the inventory report on Tuesday. This may be interesting due to the fact that we ended the year significantly higher than the previous year and inventory generally increases in January. This repot may provide some direction.
BUTTER:
Traders will be cautious as they consider whether the decline Thursday was an aberration or if it was real and buyer interest just ran out at the higher price. Butter futures continue to remain at conservative levels as traders see more of a sideways market at a lower price.
