OPENING CALLS:
| Class III Milk Futures: | Mixed |
| Class IV Milk Futures: | Mixed |
| Butter Futures: | Mixed |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 7 to 10 Higher |
| Soybean Futures: | 24 to 28 Higher |
| Soybean Meal Futures: | $5 to $7 Higher |
| Wheat Futures: | 35 to 40 Higher |
MILK:
The weakness of underlying cheese and butter prices on Friday could indicate prices have reached a threshold. Milk production is slowly improving from the low levels of the summer. Production may improve more than expected as indicated on the previous milk production report. However, increased cow numbers may be limited keeping expansions limited. USDA is estimating milk production to be flat this year, but they estimate a resumption of the uptrend for milk production next year. Overnight trade was limited as usual with traders uncertain whether further weakness may develop in underlying cash.
CHEESE:
Prices are expected to remain in a range with limited upside. This is generally the strongest time of the year for buyer interest. Product is being purchased for increased demand and the holidays. Once October is finished, buying settles down into general buying for demand with fill-in orders for the holidays continuing through the end of the year. Without much movement higher than has already been seen, further upside may be difficult through the rest of the month.
BUTTER:
Butter has certainly been a surprise as new highs were established last week. Price has tipped back since then but not by very much. Demand remains strong even at this price as production and inventory have not been able to keep pace with demand resulting in significantly lower inventory than a year ago. High price has yet to curtail demand to any great extent.
