OPENING CALLS:
| Class III Milk Futures: | 4 to 8 Lower |
| Class IV Milk Futures: | 5 to 10 Lower |
| Butter Futures: | 1 to 2 Lower |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 3 to 5 Higher |
| Soybean Futures: | 6 to 12 Lower |
| Soybean Meal Futures: | Mixed |
| Wheat Futures: | 3 to 5 Higher |
MILK:
The substantial pressure on milk futures was a surprise due to underlying cash being steady for butter and cheese and slightly higher for whey and nonfat dry milk. The attitude of traders has turned bearish with steady prices now being viewed as negative. The recent pattern has shown that underlying cash prices have declined after a day of two of steady prices. There may have also been some spillover weakness from sharply lower con futures as the market tends to have a correlation will corn. Lower cow numbers and reduced milk production compared to a year ago are currently not the focus of traders. The focus is on supply and the impact inflation is having on demand. Markets will be closed on Monday.
CHEESE:
The strength of cheese so far this week was meaningless in yesterday's trade. Milk futures should have remained relatively stable, but trader psychology turned negative after spot cheese prices remained steady. Cheese production is steady as there is sufficient milk available for all areas of manufacturing.
BUTTER:
Butter futures have a discount factored into the market in the anticipation price will not be able to hold at the current level. Some butter has already been purchased ahead for later demand. However, buyers continue to remain aggressive with a good volume of loads moving already this week. Cash activity may be slow to develop today as price is at the top end of the range.
