OPENING CALLS:
| Class III Milk Futures: | 5 to 10 Higher |
| Class IV Milk Futures: | 5 to 10 Higher |
| Butter Futures: | 1 to 2 Higher |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 4 to 8 Lower |
| Soybean Futures: | 10 to 18 Lower |
| Soybean Meal Futures: | $3 to $5 Lower |
| Wheat Futures: | Mixed |
MILK:
Milk futures are anticipated to increase again Wednesday unless there is some weakness in underlying cash. Most of the overnight trading activity in Class III futures indicates strength primarily in contracts in the second half of the year. There was only trading activity in the May contract in Class IV futures and that was 5 cents higher. Volatility is going to be the norm for much of this year as all commodity markets are in a state of confusion. Dairy is not reacting directly to the situation in Ukraine, but there will be some spillover influence. World demand will have the influence along with domestic milk supply. Prices on the Global Dairy Trade auction are an indication of strong demand with a tighter world supply. Reduced milk production in the U.S. may indicate a tightening supply influenced by the rising cost of production. At what level high prices will limit demand, is anyone's guess until we see evidence of it taking place. Markets have a tendency to change rapidly. USDA will announce the February Federal Order class prices Wednesday.
CHEESE:
Barrel cheese price during spot trading over the past two days has shown early strength in price only to slip back as the trading period progressed. The positive aspect is that price has not declined from the previous day. With block price nearing the previous high at the beginning of the year, there is concern it may fall back again as it may be a level of price resistance.
BUTTER:
Much of the buying for the Easter season has already been done as retail outlets have been placing orders earlier to make sure they have it when they want it. Churning is active as cream supply is readily available. Demand is being met with some moving to inventory.
