OPENING CALLS:
| Class III Milk Futures: | 10 to 25 cents higher |
| Class IV Milk Futures: | 10 to 15 Higher |
| Butter Futures: | 1 to 2 Higher |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 7 to 10 Higher |
| Soybean Futures: | 12 to 18 Higher |
| Soybean Meal Futures: | $3 to $5 Higher |
| Wheat Futures: | 7 to 10 Higher |
MILK:
Milk futures had a banner day Tuesday. Class III prices rallied despite the weakness of cheese prices. Class IV futures showed strong gains of as much at $1.00, supported by stronger butter and nonfat dry milk. There is no shortage of milk for bottling or processing. However, more milk is moving from processing to bottling as schools either are in session or will be in session shortly. Bottlers have been busy filling school pipelines. It is surprising the market has been so strong after the July Milk production report showed an increase of 0.2%. This is a minor increase of production over last year, but the fact that it was the first increase so far this year and that it took place during the period of the year when record temperatures were set in many areas makes it surprising futures have shown the strong gains. There has been no other fundamental news impacting the market.
CHEESE:
Block cheese price is within 0.50 cent of matching the low of Aug. 4. Moving below that level would push it back to the level last seen in January. It will be interesting to see whether buyers will step back in more aggressively due to the decline of prices.
BUTTER:
Butter seems to be building greater support, which could result in price trading in a new higher range with $3.00 being support. Buyers have been aggressive as they seek to increase ownership for demand through the end of the year. Inventory remains below a year ago with international demand remaining strong.
