OPENING CALLS:
| Class III Milk Futures: | 10 to 15 Higher |
| Class IV Milk Futures: | Steady to 5 Higher |
| Butter Futures: | Steady to 1 Higher |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 1 to 3 Higher |
| Soybean Futures: | 6 to 10 Higher |
| Soybean Meal Futures: | $3 to $4 Higher |
| Wheat Futures: | 12 to 15 Higher |
MILK:
USDA will release the May Federal Order class prices Thursday with Class III setting a record. This certainly is needed in the current market situation with high expenses increasing the cost of production substantially. Milk futures showed some surprising strength overnight with higher volume than usual. Traders seem to think underlying cash may show further strength today based on the activity Wednesday. Milk production is sufficient for demand with more milk moving to manufacturing as schools close for the summer. Milk supply is abundant in the Northeast. One co-op in that area is paying significantly less for over-base milk even though there is good demand outside of the region. There are numerous plants in other areas that are not discounting milk that is produced over the base as they welcome the extra milk for processing. Milk production in improving but remains lower than last year.
CHEESE:
Cheese prices dropped last week but now seem to be holding. This provides some confidence to traders that support might have been established. Cheese prices may not trend higher but may hold sideways for a time. Demand is variable depending on variety and area.
BUTTER:
Buyers remain active as they see lower butter output, lower inventory than a year ago and good demand. They continue to purchase ahead for orders placed well in advance as well as purchasing for anticipated needs. Buyers are not waiting and hoping for a dip in price but remain aggressive.
