OPENING CALLS:
| Class III Milk Futures: | Mixed |
| Class IV Milk Futures: | Steady to 10 Higher |
| Butter Futures: | 1 to 2 Higher |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | 1 to 2 Lower |
| Soybean Futures: | 4 to 6 Lower |
| Soybean Meal Futures: | $4 to $5 Lower |
| Wheat Futures: | 1 to 3 Higher |
MILK:
The recent strength of Class III milk futures has been surprising and incredible. After a period of weakness on a daily basis as underlying cash moved lower, the market did an about-face. There has been little change in fundamentals as milk production in the country slowly improves. Holiday and regular demand will be ongoing with product needing to be purchased to fill orders. The large push of forward purchasing has been done during September and October. Orders will continue to be placed as retail demand is met. Fluid milk demand is steady. There will be more milk available for manufacturing over the next two weeks as bottling for school accounts slows for the Thanksgiving period. However, this should not have a large impact on the market or supply.
CHEESE:
The strength of cheese has been surprising and welcomed as it has improved the outlook for milk prices. Prices are not expected to continue to trend higher but will find some buyer resistance at some level. The hope is that a price void is not developing under the market. There remains concern over the level of demand due to continued inflation and high food prices. The Consumer Price Index will be released Thursday.
BUTTER:
Butter is expected to show substantial volatility until it finally finds a level at which buyers' and sellers' emotions will settle down and business will be done. This is the most volatility we have ever experienced over the course of about 1 1/2 weeks. Higher price may find a level of resistance again.
